In contrast to Western consumers, Asian people prefer name-brand luxury goods with conspicuous logos, according to a recent market research study.

In Hong Kong, 68% of the respondents said that they prefer name brands with logos which they feel assure the authenticity of a luxury item. Secondly, as in other parts of the world, luxury name brand items symbolize wealth and social status. Many Chinese consumers regard owning luxury goods as a sign of success, and they are prepared to spend a great deal of money to convey their sense of higher class to others. Furthermore, Asian people view luxury as “about quality” and “a life style”, while the western respondents define it as “everything over and above what you need”. Furthermore, many Chinese consumers will spend money on a luxury good for a special occasion, whereas in Western countries it is usually a specific type of consumer that buys the luxury products. Brand recognition is very important—if Chinese consumers don’t recognize the brand they are unlikely to enter the store.

Given the rapid economic growth in Asia and local consumption preferences, luxury markets have been booming over the last few years. In 2009, China overtook the U.S. as the 2nd largest luxury market in the world and is expected to rise to the 1st place by 2015. Hong Kong and Macau, two major cities of luxury consumption in China, attract millions of mainland Chinese consumers seeking to avoid double-digit duties at home. Luxury brands like Piaget, Armani, and Louis Vuitton are opening new stores in succession in Asia to attract more consumers, especially the younger buyers.

Based on the results of the market research, we can conclude that Asian markets are an attractive choice for luxury brands looking to enter new markets, if they aren’t here already. As always, it is important that brand strategy be informed by market understanding of consumer needs and trends, as well as competitor positioning, to ensure an effective positioning of global brands in regional markets.