Custom «Luxury Goods in China» Essay Paper Sample

Luxury Goods in China

China's top consumer class of the rapid rise of global luxury industry has attracted the attention of a massive market potential for development and a lot of interest, driven by foreign influx of many top brands in China to seize the high luxury market. The resultant luxury product market in China is loaded with foreign products and brands. In the luxury market, China has not yet formed a confrontation with the local luxury goods industry. As a result, consumers in China are not consistent with      the brands. China's market potential is likely to be controlled by the foreign giants if the local companies do not improve their brand performance. Therefore, the development of China's own luxury brand is essential to the growth of the economy.

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Definition of brand loyalty

A brand name is a title that is used by business persons to identify the goods and services which they offer in the market. Brand loyalty refers to the preference of a customer to a certain product or service. It refers to the situation where a customer always goes back to buy a product from the same source he or she bought the previous product. In this case, the choice of product is always based on the manufacturer of the product. Customers that have such a tendency believe in the manufacturer of the product. That is amongst all products in the market, the product chosen is usually considered the best. As a result, the customer pledges to be loyal and devoted to buying products from the same manufacturer repeatedly.  Brand loyal customers take time to taste the product once satisfied the client purchases the same product continually. Such clients are not tied up by price factors, and they tend to advocate for the product to other people.  

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Brand loyal

Brand loyalty is today a critical issue that has affected many businesses both the international businesses and local businesses. Brand loyalty has been known to have a direct influence on competitive advantage of many companies. That is many companies have had a significant increase in the market share. As a result, such companies exhibit a considerable growth annually. Therefore, brand loyalty is an aspect that should be highly regarded as it brings in high returns to investments in the company and business.

Brand loyalty has also posed a significant challenge to many companies. The concept of brand loyalty has been misunderstood, and in other contexts, it has been underestimated. Brand loyalty is one of the factors that companies can look into and be sure of good returns to the business by the end of the day. Hence, brand loyalty has two different aspects in it that should be looked at from different perspectives. The customer can be loyal to a brand because of the satisfaction he or she will have obtained from the product. On the other hand, the customer can also be loyal to a brand out of other reason such as friendship or other relations with the producer (Nemati p. 300 2010).

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Brand loyalty is then a subject that is worth putting efforts on by the company or business. The marketing department should strategize in such a way that the company can maintain its consumers within its borders. That is the product should be presentable and appealing. Above all, it is beneficial that the product meets the customers demand and need. When the company is handling the subject of brand loyalty, the company should employ effective marketing strategies that will motivate and influence the customer to buy the product and hence remain loyal (Kabiraj and Shanmugan p. 2011). 

Brand loyalty in Europe

Brand loyalty in Europe so far has been well exploited. The companies in Europe have fully explored the potential and opportunity that comes with brand loyalty. In Europe, brand management companies ensure that they enhance brand loyalty by improving on the clarity, vision and strength that come with the brand name. For instance, Euro brand management takes care of branding footwear companies in Europe. The company has ensured that each brand name of a shoe is unique and is attractive to the client. In addition, the brand name has clarity on the product for sale.

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Development of brand loyalty in Europe

In Europe, brand loyalty is a stepping stone to improve business revenues. Many companies are taking brand loyalty as an opportunity to improve their businesses. The business people in Europe have discovered that customers always return to the place where they first bought the first product. A survey done on teenagers buying trends reveal that most of the young ladies will look out for new products in the market. They maximize on online sources and catalogues. Hence, companies that have done a good presentation of their brands tend to get a lot of clients. On the other hand, male teenagers return to the old stores where they last bought their stuff. That is the young male clients will often return to the previous seller, while the male have a trend of maintaining a brand in shoes and clothes. While the ladies browse for the latest brands in the market.

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Dave T (2011) reports that some companies in Europe have maximized on customer relations to maintain their brand names in the market. The car companies in Europe take give their clients a free tour to the manufacturing plants. This way the clients get to interact directly with the maker of the car. Once the client has bought the car, he or she will not easily forget the experience. Hence, such a client is likely to go back for another car the next season. That is in Europe companies have discovered the effect of doing direct marketing where the company has direct communication with the client. In this case, some companies have already diverted from the use of media in marketing to field work and one-on-one marketing strategy (Christopher p.55 1996).

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Development of brand loyalty in China

Despite the fact that China manufactures luxury goods, the sale of china’s luxury products has surged since 1990. Many multinational companies in the recent past have entered the china market and established their business within the China market. Surveys in China reveal that Chinese people have an average habit of buying luxury goods. Most of the people who buy luxury goods prefer to buy the products that are branded. However, a few other people still buy jewelry for the stores (Debnam and Svinos p.13 2007).

Further statistics have shown that Chinese economy is continually growing. That is due to the continual growth of the economy the rich people in china are today buying imported goods. This is in essence that Chinese people regard having luxury goods as a way of raising a person’s status. The status of the luxury brands in China is continually growing. However, the market in China has been affected by people who have continually introduced fake products into the market. Nonetheless, the introduction of the fake products has enhanced publicity of the original products in the market. This is so far the main challenge that businesses in China have as the fake products are gaining more publicity and at a fast rate. In this regard, the brand loyalty in China has been adversely affected. Hence, brand loyalty in China is still considerably low.

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The Chinese market is saturated with luxury products from within and international companies. Hence, it may be hard for a person to remember a certain brand name. Further studies by Debnam and Svinos (p.13 2007) highlight that the Chinese do not have adequate knowledge on the brands they have in the market. As a result, the luxury companies go an extra mile to ensure that they inform their local clients about luxury products in the local markets. There are many strategies that have been employed which have enhanced brand awareness in China. In return, many companies have managed to gain more clients. While in other instances, companies have also taken advantage of the window shoppers as they are future customers. As time goes by, businesses in china have realized the role of branding. Hence, Chinese companies have slowly changed strategy to enhance brand awareness and brand performance. This will result to brand loyalty in China.

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Compare the difference between Euro and China

There is a major difference between Europe and China’s reaction to brand awareness and loyalty. As Europe has realized early about brand loyalty, China is gradually adapting the new strategy. However, the China market is generally challenging compared to the European market. This is because the China market is loaded with many luxury products compared to the European market. As a result, Chinese clients may take more time before they can adapt to the local brand name. In addition, the mentality of buying particular brands due to status is also a challenge to the local companies. Unlike Europe, Chinese are more attracted to the western brands than the local brands. However, Chinese business people prospects that as they enhance publicity of the products brand loyalty will improve.

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