Luxury letdown

By Chen Dujuan Source:Global Times Published: 2011-7-15 10:20:00

Li Na is a fashionable girl. She loves big brands and believes luxury goods are synonymous with good design and excellent quality. But a recent shopping experience has destroyed her faith.

The 28-year-old journalist spent 3,900 yuan on a pair of Prada sandals at a Beijing shopping mall in May, but after wearing them for an hour the top part of one of the shoes started to come loose.

"We don't offer refunds," she was told by a Prada salesperson when she went back to the shop. The salesperson suggested she just change the shoes for another item.

Following unstinting efforts to negotiate with Prada, Li was lucky enough to get her money back several weeks later. She told the Global Times that she met three other girls at the Prada counter who had problems with shoes they had bought.
"I won't have such blind worship of those big brands anymore, as they don't mean good quality or good service," she complained.

Fast-growing market
The World Luxury Association (WLA) predicts that China will be the world's largest market for luxury goods in 2012. Many top brands including Prada SpA have already floated in Hong Kong to tap into the market.

However, as more stores selling luxury goods open nationwide, people are discovering that after-sales services do not always match the high prices.

Quality problems are nothing new for luxury brands. A quality check by the authorities in Zhejiang Province in March this year found that 56.6 percent of clothes from imported brands had quality problems, including items from 30 famous brands such as Hermes, Versace and Dolce & Gabbana.

"We spend three times more money on the same product in China than in the US, but the services we receive are less than one third. In the US, consumers can get refunds, even without all the purchase certificates. However, complete certificates are needed for a refund in China," said Lin Ying, a Chinese girl who is now studying in the US.

Luxury sales in China in 2010 totaled $12 billion and Ouyang Kun, chief representative of the WLA China Office, said at least 10 percent of those goods would need to be repaired.

"But luxury brands make the repair procedure complicated. If you want the company to repair it, you need to sign a contract indicating the responsibilities that you have to shoulder. And many consumers give up due to the long time it takes for a repair," said Ouyang. 

Li's experience with Prada is not unusual. Refunds are hard to come by, and repairs usually involve the product being sent back to the company headquarters, which can take months. And if the product is out of the warranty period, the cost can be prohibitive. Some top brands such as Gucci and Prada don't even offer customer service hotlines. 

A member of staff at Louis Vuitton told the Global Times that the company has a repair center in Shanghai, but it can only deal with small problems and it takes at least one month. If damage to the product is more serious, it has to be returned to France, which takes several months.

A salesperson at Dior's branch in Beijing said that few bags are returned to France for repair, partly because it is so expensive.

Boom in maintenance
People have spotted a business opportunity from this service shortfall, and luxury maintenance companies have been growing in number in recent years, charging increasingly high prices. Near Shin Kong Place, a luxury shopping center in Beijing, several such stores have opened.

One luxury bag maintenance firm, Blucci, opened its first store in Beijing in January 2009 and now has nine branches nationwide.

"Our store in China Central Place next to Shin Kong Place has the most customers, including people who know about us from word of mouth and those who came after we were recommended by the luxury stores in Shin Kong Place, the World Trade Center and Financial Street," Duan Yue, Blucci's marketing director, told the Global Times.

Another luxury maintenance center, Eviboo, opened its first store in Beijing last September, opposite Shin Kong Place.
"Basic cleaning at Eviboo costs 180 yuan for wallets, 280 yuan for handbags and 480 yuan for suitcases; repairs range in price from 380 yuan up to 680 yuan," said the firm's Executive Director Mao Hui. 

Service at the core
"Consumers spend tens of thousands of yuan on luxury products, not only for the products themselves, but also for good services," said Qiu Baochang, director of the Consumer Rights Protection Committee with Beijing Lawyers Association. 

"Double standards implemented by some luxury brands will reduce their brand value and become a bottleneck for their development in China," Gao Boxuan, a senior luxury researcher with CIC Industry Research Center told the Global Times. 

The solution is to offer a unified service standard internationally and implement strict quality control in order to maintain their high-end brand position, Gao added. 

"We have already established China Luxury Consumer Committee, a third-party organization that is part of the World Luxury Association, in which luxury experts and after-sales staff from luxury brands in China serve as coordinators and appraisers.

The committee can provide constructive appraisal reports so that consumers can get repair services more rapidly and directly," said Ouyang from the WLA.

Meanwhile, the association is urging more luxury brands to set up after-sales centers in China, Ouyang added.



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