Design Holding, a Milan-based high-end luxury interior design group, plans to double its presence in the Chinese market through digital marketing and retail expansion, the company’s top executive said. ‘company.
Daniel Lalonde, CEO of Design Holding, which operates in more than 130 markets and owns a group of industry-leading brands such as Flos, B&B Italia and Louis Poulsen, said in an interview with China Daily that their design company house had enjoyed strong favorable winds around the world, including in the Chinese market. The reasons for this are that people are spending more time at home and have transformed their homes into real multifunctional spaces.
“I think now people are more interested in cooking, hosting and working from home, so we’ve seen a rejuvenation of homes,” Lalonde said.
The company has identified the Chinese market as one of its two priority markets outside of North America.
“We are investing heavily in building our brands in the Chinese market,” he said. With all of its brands in China, despite being in their infancy, “there is clearly a huge opportunity for brands to develop and grow.”
Last year, Design Holding’s worldwide revenue was approximately 700 million euros ($723 million), a year-on-year growth of 21%. Its first-half China market revenue grew 16.6 percent year-on-year amid COVID-19, the company said.
The company will launch a Fendi Casa flagship store in Shanghai in January 2023.
Lalonde compares how the luxury interior design market in China is now similar to what the luxury fashion sector was about 25 years ago in the country, which requires more effort to make know the luxury design industry, but it shares similar perspectives with luxury fashion brands as their customers are the same.
China’s luxury goods market ended last year with strong double-digit growth, with some brands exceeding 70%. More Chinese consumers are shopping domestically, leading to a 48% increase in personal luxury sales in China in 2020, and another 36% in 2021, for a total of nearly 471 billion yuan ($66.9 billion), a near doubling in just two years. The market is on track to become one of the world’s leading markets by 2025, according to a report by consultancy Bain &Co.
With eyes on young luxury consumers in China, Lalonde said their research has shown that millennials in China are enjoying themselves more at home.
“I think they want their home to be a reflection of who they are. That’s why we see a lot of interest in our brands,” he added.
As younger generations have developed their interest in luxury fashion in terms of bags, shoes and watches, their next focus on luxury is what they have at home, the CEO said.
“There are some changes in behavior, and in the market, behavior leads to a consistency towards luxury to redefine the home environment.”
Therefore, Design Holding has increased its investment this year in integrated marketing efforts, including digital marketing, such as developing their social media campaigns on Weibo, WeChat or Xiaohongshu, with short videos of celebrity home visits. or fashion opinion leaders where their iconic sofas and lamps are showcased.
“As part of our integrated marketing efforts in China, an important aspect is to use our brands’ social media channels to draw attention to the changing way people experience and interact with spaces, to both inside and outside the house,” Lalonde said.
In addition to marketing, the company has ramped up building distribution in first- and second-tier cities, with plans to open in at least 30 cities nationwide, both directly operated and working with licensees to increase visibility of their brands and products. The company currently has 150 outlets in China and is expected to double the number of stores by 2024.
The CEO said that in addition to its direct-to-customer business, the demand for contract business focusing on luxury hotels, serviced apartments or luxury stores has also increased in China, where their brands provide design, furniture and lighting consultancy services.
Globally, contract work accounts for approximately 25% of its total business in terms of revenue. It expects its direct-to-consumer and contract business in China to grow 30% annually.