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June 27, 2014 5:45 pm
I have spent the past eight years in Shanghai as a privileged witness to the evolution of the most complex and fascinating market in the world. Shanghai, of course, is not all of China but it is a city that seems to anticipate the future trends guiding Chinese consumers’ attitudes.
I have learnt a few things since arriving here – moving from a pleasant life in London with my wife and our two young children to a Bauhaus building at the end of a quiet lane, in the middle of Shanghai’s former French Concession. Suddenly, we were in terra incognita.
Since 2002 I had been working for Alfred Dunhill, advising the company’s then president, Simon Critchell, on the task of updating a venerable British brand. Through a combination of digging in Dunhill’s archives, betting on craftsmanship and new design, we managed to restore something of the company’s “soul” and, in 2006, I was asked to move to Asia to develop the brand there. Within days I was plunged into the search for a site and, in 2008, opened the “home” of Dunhill in Shanghai; it also has homes in London, Tokyo and Hong Kong.
Historically, the place to go luxury shopping in Shanghai was the Nanjing Road and the Plaza 66 mall: more or less one street, or stretch of a street, with all the famous brands. It was boring but, as it was new for the Chinese, it worked well and companies kept opening big, soulless stores there. Today, however, the market has changed; Plaza 66 is still leading but is being challenged by other malls opening nearby, such as Kerry Centre and Reel Mall.
For me, the Huai Hai Road, which crosses the old French Concession, was perfect for Dunhill. By the start of this century it was hosting some interesting brands and one-off projects. Today it houses Dunhill in part of the restored Richemont Twin Villas, which date from the 1920s. Hermès will open in September in a former police administration building on the same road.
Chinese consumers have become highly selective, more aware that they have a variety of brands to choose from. Each new arrival of a foreign luxury label attracts attention but only for a while. Younger customers tend to look for the latest fashion brands and Chinese men now dress in a more interesting way, compared with when they used to wear one brand from head to toe.
When I suggested opening a Dunhill home in China, many people thought it was going to be a failure but it was – and is – a big success. Local consumers were delighted to experience something new and, more importantly, a place with a story that differs from the bland efficiency of shopping malls.
China is a particularly responsive market: once you enter it, you are on board a very fast train and no mistakes are allowed – like driving a fast car on a dangerous but exciting road. If a product is right and the communication well done, it is a highly rewarding environment. You just have to be alert to the speed of change; what was true at lunchtime may have to be reconsidered at dinner. I found I was relying increasingly on instinct to react quickly and accurately. Too much analysis can be a disadvantage as there is often not much rationality in the evolution of the market.
Here, I find that unwritten rules are at least as important as written ones. The written rules often stem from analysis of the past 15 to 20 years; the unwritten rules are based on the capacity of people working in retail, such as sales assistants and store managers, to adapt to changing behaviour and to offer an unexpected but highly appreciated service.
I do not speak Mandarin, though I can understand a little, but my children are fluent. I have never found language to be a problem – so long as you master all those subtle ways to communicate in China. This is, if you put aside a few frustrating things, one of the most wonderful places to live in the world. My wife, a true Parisian, and our two children, born and raised in the UK, love their life in Shanghai. The city offers very high security and the Chinese are extremely hospitable and generous – both rare qualities.
When I first arrived in China, almost everyone I met kindly gave me a lot of advice. Probably wise advice but I quickly learnt to both listen and to ignore it, and to follow what I thought made sense.
Most of the advice I received warned me that I was too much of a dreamer – that Chinese consumers were not prepared to listen to any story, however wonderful that story might be. What I discovered is that the Chinese, like their British counterparts, do want to dream and to hear brands’ interesting stories.
Yann Debelle de Montby is chief executive and co-founder of Debelle de Montby Associates, a consultancy specialising in luxury and brand identity based in Shanghai
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