The love for food of Chinese customers is being tapped into by high-end retailers in China to boost sale of luxury goods.
Cafes and restaurants to their shops have been added by a host of vendors offering everything from jewellery to exquisite kitchenware and expensive cars. They hope that this would help the social-media savvy younger customers have an experience that would be appealing for them.
And analysts say that the waiting lists of the stores indicate that the strategy is paying off.
According to a report published by the South China Morning Post, there has been a backlog of reservations at experimental crossover restaurant above its store in Shanghai’s buzzing West Nanjing Road, according to a statement of Zwilling JA Henckels, the German upscale knife and cookware maker. Requests from her friends for a table on Christmas Eve and Christmas Day had to be turned down by Eva Liu, the restaurant’s deputy general manager, the report said.
“Sorry. Two spots at the bar at 8.30 pm, that is the best we can offer,” she told her friends over the phone. “We’ve been fully booked for a couple of weeks.”
This is the first foray into the food and beverage business in China by the long-established kitchenware giant where Mediterranean-style eatery prepares food which is eaten using Zwilling’s own products. The company expects its December revenue to reach 1 million yuan (US$143,000).
“Dining is not just about eating, it is more about the experience now in China, and in particular those experiences that can be shared or even shown off. Eating at a top-notch brand like Zwilling is something that is worth taking pictures of, posting on social media and waiting to get tons of likes,” said Liu.
Even in the face of a slowdown of the Chinese economy, the catering market of the country has showed resistance. According to the National Bureau of Statistics, there was a 9.4 per cent year on year growth in the catering revenue through November to reach 4.19 trillion yuan. That growth rate was the same as in 2018.
“Luxury retailers tapping F&B business will be a sustainable trend in the coming years riding on China’s large consumption market,” said Shirley Hu, director of research, CBRE China. “It’s inexpensive to take a cup of coffee or a drink in a luxury-branded eatery [as compared to actually buying a luxury product]. This will be an important way for luxury retailers to maintain the loyalty of younger consumers.”
One of its signature Blue Box Cafés on the second floor of a flagship store on Shanghai’s Huaihai Middle Road was opened by the famous New York jeweller Tiffany & Co on December 23. According to a spokesperson quoted by local media at the launch ceremony, there is a six-month waiting list at the eatery as the fans of the iconic movie Breakfast at Tiffany’s crowd the place.
In December, a Lanvin Café was opened by the French fashion house Lanvin on Shanghai’s famous riverfront Bund.
Right beside it, most of the area of one of the concept stores of the German luxury car maker Mercedes is occupied by food stalls. The total size of the store is about 1500 square metres. While Sichuan food can be found on the second floor, Western cuisine is offered at the first floor of the building.
“We are not aiming for a Michelin-starred restaurant, or to make a fortune, we just want a profitable business that appeals to Mercedes-Benz customers,” said Jane Li, chief commercial officer with Applied Brand Solutions, which has exclusive rights to run Mercedes Me stores in mainland China.
“We have seen that through such platforms [the food offerings], we are getting closer to average people, and making the brand less masculine and much younger, instead of what people used to think of Mercedes-Benz: that it only represents middle-aged, ultra rich guys,” said Li.
(Adapted from SCMP.com)