Why China’s youth are swapping luxury for local brands

On a weekend at The MixC, an upscale shopping mall in Chongqing, the Songmont store was busy with a steady stream of shoppers, while the Coach outlet in the same mall looked comparatively quiet. 

A post-90s shopper surnamed Zhu, who had just bought a Songmont bag, told Lianhe Zaobao, “The design’s nice, and it’s reasonably priced at about 3,000 RMB (US$439).”

In recent years, a new wave of local handbag brands in the 1,000-RMB price range — represented by Songmont, Qiuzhen and Grotto — has been thriving in China. Last year, Songmont and Qiuzhen both ranked among the top three in sales during the Tmall Double 11 shopping festival, closing in on long-time leader Coach.

Beyond handbags, perfume label To Summer, known for its Eastern culture positioning; sportswear brand Maia Active, often dubbed the “Chinese version of Lululemon”; and cosmetics brand Mao Geping have been winning over market share previously dominated by international brands in recent years with their mid- to high-end offerings.

According to data compiled by BigOne Lab, Bloomberg News analysed that five Chinese premium brands — spanning handbags, apparel, fragrance, cosmetics, and jewellery — posted faster sales growth than seven foreign rivals from 2024 to 2025.

Publicly available data shows that Mao Geping recorded a 30% rise in revenue last year; To Summer saw sales of its core fragrance products surge 211% in February this year; Songmont’s online bag sales grew over 90% year-on-year in the first three quarters last year; and jewellery brand Laopu Gold reported a 229% increase in revenue last year.

By contrast, looking at the performance of international accessible luxury brands: Michael Kors’ parent company, Capri Holdings, saw Asian sales plummet 43% year-on-year in the second quarter of fiscal 2025. Similarly, Tapestry — the group behind Coach and Kate Spade — continues to face declining revenue in the Chinese market.

Xu Jian, a professor at Shanghai Jiao Tong University’s School of Media and Communication, told Lianhe Zaobao that China’s post-90s and post-00s youths are becoming the main consumer base for designer brands today, with shifting consumption preferences. This provides the conditions for the rise of local Chinese designer brands.

Xu noted that China’s new consumer base is a unique generation of only children; they are fiercely individualistic yet socially anxious, and rely heavily on social media, which thus becomes the most effective channel for understanding Chinese consumers. “The rise of local designer brands has all been propelled by the internet,” he said.

Post-85s generation Zhou Chuanyi bought a Qiuzhen handbag last year. From discovering the brand and checking reviews to placing the order, the entire process took place through social media accounts and online platforms. She was unaware that Qiuzhen had any physical stores.

Zhou said in an interview that she does not like bags with large logos. “I don’t want even a bit of attention so I mainly go for simple and understated designs.”

When Zeng Jing, a young employee from Chongqing, purchased a Grotto handbag three years ago, she had also come across the brand on Weibo.

“First online, then offline” has become the main way for domestic Chinese brands to enter the market, and most of the aforementioned emerging local designer labels have followed this path. By contrast, international brands have a more limited online presence and tend to rely on offline advertising and traditional channels to engage with consumers.

Zhang Ye, founder of Cyanhill Capital, which focuses on China’s consumer market, also said in an interview that China has the world’s most advanced digital channels. Brands obtain feedback through content platforms, build emotional connections via communities, and ultimately drive sales through e-commerce — this is an advantage Chinese domestic brands have in reaching consumers.

Cyanhill Capital noted in a report that the younger generation of consumers has grown up alongside China’s economic rise and digital transformation. With a global outlook and stronger cultural confidence, they tend to regard domestic and international brands equally, providing a deeper psychological foundation for the development of domestic brands.

This has also contributed to the emergence of more young designers who possess both creativity and strong market sensitivity. Zhang said that China has a large pool of designers and entrepreneurs who have long been immersed in a global cultural context. They understand both the logic of international design systems and the specific dynamics of the Chinese market.

Post-90s designer Chen Peng, who graduated from the London College of Fashion, founded his brand CHENPENG in London in 2015 and established a company in Shanghai the following year, making an entrance into the Chinese market.

He said in an interview that consumers no longer automatically favour foreign brands but are instead becoming more willing to pay for Chinese aesthetics, Eastern philosophy and local culture.

The other side of this “equal footing” is that domestic brands do not enjoy any premium pricing advantage by default. Zeng said frankly that she will not blindly support a product just because it is a domestic brand — it is still about the product itself. However, she thinks that the pricing power of local handbag brands still falls far behind that of international labels.

Chinese economist Pan Helin said in an interview, “‘Being Chinese’ is a plus, but not a deciding factor. A premium based solely on being a domestic brand cannot sustain long-term popularity in China.”

Amid slowing economic growth and weak consumption, China’s luxury market contracted by 3-5% last year. Backed by mature manufacturing and supply chain systems, Chinese brands enjoy a price advantage at comparable quality, leading increasingly price-sensitive middle-class and younger consumers to shift their preferences from brand prestige towards better value for money.

Jacques Roizen, an independent China market advisor for global consumer brands, noted in an interview that the rise of Chinese homegrown designs is still mainly concentrated in the “light luxury” segment, where they can more easily meet the demand for contemporary designs at lower price points than traditional top-tier luxury brands. It is also better positioned to meet younger consumers’ preference for balancing “value” and “cultural relevance”.

Pan also noted that value for money is one of the key advantages of Chinese brands. “For a fashion item priced at 1,000 RMB, if performance is comparable, it still offers better value than international luxury labels.”

Meanwhile, Chen argued, “Value for money is the foundation, but not the defining factor. Consumers favour domestic brands not because they are ‘cheap’, but because they are ‘worth it’.”

Amid growing cultural confidence among Chinese youths and official support for the “Guochao” (国潮, national trend) movement, domestic Chinese brands have gained greater room for development. Although their scale remains relatively small, their rapid growth has drawn the attention of traditional international luxury companies, prompting them to reassess the competitive landscape in China.

According to the “2025 Chinese Personal Luxury Goods Market”, a report issued by Bain & Company on 29 January, China’s domestic luxury brands have been on the rise, and are often the first luxury purchase for Chinese youths and those entering the luxury market for the first time. International brands have also realised that their share of younger customers is steadily declining.

French luxury giant LVMH has already detected this shift. Its deputy CEO Stephane Bianchi said in May last year that Chinese consumers were showing growing interest in domestic brands. Four months later, CEO Bernard Arnault visited China and made a point of touring the Shanghai stores of Songmont and Laopu Gold.

Regarding the competitiveness of Chinese brands, Roizen said that while Chinese homegrown design brands have indeed made notable progress, the sector is still in an early stage overall, with European luxury brands continuing to dominate in the high-end market.

He explained that although the cultural resonance of Chinese brands is a strong asset, European luxury brands have still set a high bar in terms of innovation and sophistication. Meanwhile, local brands face challenges in profitability, brand equity, marketing reach, and in striking a balance between cultural authenticity and international appeal. 

Pan also said that Chinese brands are still relatively inexperienced in design, materials, and the techniques used to build luxury brands. In particular, cultural differences between China and the West can limit the global reach of Chinese brands and also constrain their consumer base.

This article was first published in Lianhe Zaobao as “中国设计品牌崛起 年轻消费者改写奢侈品格局”.

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