Shanghai Tang: the First Global Chinese Luxury Brand

1399 Words Feb 1st, 2011 6 Pages
Shanghai Tang: The First Global Chinese Luxury Brand

1. What is a luxury brand and how is it different than a mass market brand? How does one build a luxury brand? 2. What might have accounted for Shanghai Tang’s unsatisfactory early results in building a global luxury brand? What could they or should they have done differently? 3. What strategies did they use to promote the brand? What worked and what didn’t work? How did they expand the brand? Was it a good strategy? 4. How has Shanghai Tang positioned itself relative to other luxury brands? How might that improve? Is it important to be brand positioned relative to competitors?

A Luxury good is defined in economics as a good whose demand increases more than
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Open premium retail locations 3. Sponsor regional events
These strategies helped to make the name Shanghai Tang a known brand locally and in regional markets. The problem with this is strategy is that their customers were not the local Chinese. Their strategy seems very confused and almost bipolar. Shanghai Tang wanted to sell to local Chinese and therefore focused on localized public relations. They also sponsored events relevant to each regional market which was in-line with their consumer base target. But there was a big problem, Shanghai Tang placed their stores in prime retail locations, opened shops in world-renown hotels and opened shops in airports were most of the traffic was foreigners and tourists. Shanghai Tang’s real customers seem to be the wealthy foreigners and tourists with the means and money to travel and stay in world-renown hotels. This consumer base would not be watching a lot of local events and have few local contacts. Their strategy seems to have been out of focus and targeted at the wrong consumers. I feel that Shanghai Tang’s strategy was out of focus and more of an effort to save money then build a Chinese luxury brand.
One of their strategies that did work was the partnering with famous local designers. This brought Shanghai Tangs some credibility which was sorely needed. By partnering with famous local designers, they were able to expand the product line into jewelry, accessories, hats, t-shirts, and eyewear.

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