The French house announces Shang Xia, a new luxury brand in China

Paris December 21 – Patrick Thomas, Head of Hermès International unveiled that the French luxury brand is about to launch a new label called “Shang Xia” which literally means upside-down (source la Tribune and Capital.fr). Shang Xia will be a true luxury house with a cultural Chinese heritage in terms of patterns, fabrics and know-how. The brand management and the design studio will be based in Shanghai and the art direction will be under the responsibility of the Chinese designer Jiang Qionger, daughter of a famous local architect. For the launching of its “me too” company, Hermès will start to communicate during spring 2010.

New impulse or remedy?

According to the consulting firm Bain & Co, Chinese will be the main contributor to the luxury sector growth in 2010. Analysts are questioning if this launch represent a major change in Hermès strategy which failed to success in China. The company arrived too late in this huge country and has only 16 shops when competitors such as Louis Vuitton or Gucci have twice as many. Even if the new brand will be extremely luxurious, products crafted in China will be at a competitive price compared to imported goods from Europe.

In order to give some credibility to Shang Xia, Patrick Thomas explained that Hermès is currently discussing with a famous Parisian department store, mandatory visit for Chinese tourists in Paris.

Let’s hope that Shang Xia will be more successful than Shanghai Tang, the luxury fashion brand acquired by Richemont in 1998 which is still chasing success.

Yvon Le Gall

Luxury-world

http://france.hermes.com