Can “Revenge Spending” Save Luxury in China?
China is embracing springtime, as the COVID-19 outbreak continues to slow. On Thursday, China reported no new cases of domestic virus infections for the first time since the outbreak began, and recent new cases have mostly come from overseas, signaling that the worst has passed as of now.
But as more residents go outside and resume activities, a term that’s been discussed frequently in the media is coming to the fore: “revenge spending.” The phrase describes how shopping-starved consumers will come out of quarantine and overcompensate by making more purchases than normal. Brands have already seen a modest jump in sales, but how much can they rely on these predicted spending sprees?
Offline stores are already welcoming the recovery of foot traffic. Pictures of people lining up outside of SKP Beijing and at Bicester Village in Shanghai have been circulating online. It was reported that the high-end Hangzhou Tower mall opened for five hours on February 22 and achieved more sales than on the same date a year ago.