A veteran of the luxury retail industry, Claudia Shaw took a position with Chanel’s senior team in Asia in 1996 and has been with the company ever since. Her current position as ambassador and regional adviser involves overseeing buying for the entire Asia-pacific region, hosting instore events and styling for Chanel’s clients, including some of the biggest VIPS in Asia.
The shopper demographic has shifted over the past 20 years from Japanese to mainland Chinese tourists.
The Japanese used to come because the prices were much more attractive. They shopped differently from the Chinese, though. In general, the Japanese are less gregarious, less ostentatious. With the change in the Japanese economy, the Japanese stopped travelling and spending as they had. Meanwhile, the introduction of the Individual Visit Scheme in 2003 marked the beginning of a decade of huge growth in mainland Chinese visits to Hong Kong. Before that scheme came into effect, a little over 7 million mainland Chinese visited Hong Kong each year. Ten years later that number had grown to 44 million. For the luxury stores, this meant mainland Chinese suddenly made up 70 per cent of your tourist clientele.
The anti-corruption campaign hit every luxury brand in Hong Kong really hard.
It was especially bad for watches and jewellery, but everybody has been hit. The effects of that campaign combined with pricing problems greatly reduced the numbers of mainland Chinese shoppers visiting Hong Kong. Before we harmonised our prices at Chanel, we would see maybe 30 to 50 per cent difference in the prices between Paris and Asia due to currency and tax differences, and most brands experienced the same problem.
For me, personally, I think the crackdown on corruption was a great thing.
I always said it was not sustainable to have double-digit growth every year. There was always going to be a point at which it would level off or maybe dip. It had to happen. It was just ridiculous, conspicuous spending. That said, while the numbers may have declined slightly, I believe we will always have mainland tourist shoppers. Once the residents from the first-tier cities stop coming—because they have been a few times and want to try somewhere more adventurous—it moves to the second tier and then the third. There will be an ongoing influx.
There’s been a massive expansion of stores for high-end brands.
Twenty years ago at Chanel we had maybe four shops, and now we’ve got 10 or 11, including Macau. The rate of acceleration Hong Kong has seen on that front is unusual. Everybody jumped on the bandwagon when business was booming. In the past two years some brands have been forced to close non-performing stores. I think the lesson is that any business that relies so heavily on tourists for income is at risk.
The rise of malls has made shopping boring.
We didn’t have so many in the past. We didn’t have IFC, Pacific Place, nor Landmark as it is now. Before the handover, the larger stores were department stores, and most of them were Japanese. That was a huge phenomenon in the ’80s—daimaru, Sogo, Matsuzakaya, Seibu. Then those businesses went from boom to bust in the early ’90s—in part, I think, due to the Asian financial crisis—and we began to transition to Us-style malls. The mix of brands in them is always the same, give or take a few. Before the malls there was a more eclectic mix of boutiques. Someone selling hi-fi equipment would sit next to someone selling silver. It would be a nice mixture of merchandise that wasn’t all fashion, jewellery and watches. It used to be easier to find a nice bookstore, or a shop selling lovely curios. Now it’s so repetitive and homogenised.
I love what they’ve done with Soho.
I think it’s important that we don’t negate our heritage—which we tend to do—but I think we could do more to encourage local talent, whether it’s fashion or food or crafts, with affordable rents for studios and stores. As a shopping destination, we are not as exciting as Tokyo or Seoul because creative people who want to open a little shop here can’t.
There’s been a rise of activewear stores.
They’re so much more a part of life these days as it’s become a trend for people to wear gym gear all day. It’s that horrible lifestyle trend we have adopted from America, hence these sportswear brands that have a lot of money— Adidas, Nike and so on—have expanded their footprint.