Chinese luxury consumers shift habits

In a large second-hand luxury store in Shanghai, a 24-year-old dance teacher named Yuan describes how Chinese consumers are changing their habits. They are moving from a focus on spending the most to making the best deals and spending less, reflecting broader economic challenges.

Historical spending power of Chinese consumers

Chinese consumers have long been among the first global buyers of luxury products. A few years ago, they accounted for a third of the sector's spending, bringing in billions of euros for major brands like LVMH and Hermès. However, recent economic difficulties have led to a decrease in luxury spending.

Decline in luxury market growth

According to Bain&Company, the Chinese market for personal luxury goods contracted by 3 to 5% in 2025, following a 17 to 19% decline in 2024. LVMH, the world leader in luxury goods, reported a drop in organic sales in its Fashion and Leather Goods division, citing a "slowing demand in China."

Rise of the second-hand luxury market

At the same time, the Chinese second-hand luxury market grew by 15 to 20% in 2025. Insight&Info Consulting estimates the segment reached 38.4 billion yuan (5.1 billion euros) in 2025 and could surpass 100 billion yuan by 2030, showing a significant shift in consumer behavior.

Luxury brands adapt to changing trends

Driven by young people's interest in resale platforms, luxury brands are adjusting their strategies. Over the past two years, Louis Vuitton has closed five stores in mainland China, and in May, Galeries Lafayette shut down its shopping mall in Beijing. New stores like Shanghai Super Zhuanzhuan emphasize second-hand luxury, with strict rules like requiring gloves to handle products.

Younger generation's changing tastes

Phoebe Ma, a 24-year-old customer, notes that her mother's generation associated Louis Vuitton with prestige, but she finds the brand's monogram outdated. Generation Z prefers Korean brands, which are seen as more trendy. Nearby, Echo Wang, 31, highlights that second-hand platforms are now more regulated, offering better value for consumers.

Shift in consumer values

Chen Luo, a China consumption specialist at Bank of America, explains that Chinese consumers are moving away from seeing luxury as just a symbol of social status. They now value originality, identity expression, and emotional or cultural significance in products. Retail in China is also heavily influenced by digital and social media trends.

Legal challenges for Western brands

Some Western brands face legal issues in China. Louis Vuitton recently won a trademark case against the local milk tea chain Molly Tea, but the dispute sparked debate. Critics noted the disputed logo has roots in traditional Chinese decorative art, questioning the relevance of the legal action.

Future outlook for the Chinese market

Despite these challenges, China remains an important market for luxury brands. Analyst Chen Luo predicts that while it may not be a growth driver for the next two to three years, it will still hold significant appeal for global luxury companies.