Jing Daily City Guide: Wuhan | Jing Daily
To the outside world, Wuhan is synonymous with COVID-19. The epicenter of China’s coronavirus outbreak, the capital of Hubei province became a household name in 2020 after placing 11 million residents into lockdown for 76 days — one of the most extreme measures taken to combat the pandemic. As infections inevitably spread across the world and people looked for someone or something to blame, the most populous city in Central China became the scapegoat for lost jobs, closed borders, isolation, death, and endless uncertainty.
But there is so much more to Wuhan than tragedy. Located along the Yangtze river, it is sometimes referred to as jiusheng tongqu (九省通衢), or the gateway to nine provinces, as it serves as a transportation hub to other major cities. It is also known for being a cultural and scientific center, home to renowned higher learning institutions like Wuhan University, hundreds of research institutes, thousands of high-tech enterprises, and investments from some 230 Fortune Global 500 firms.
More than anything, Wuhan is a place of resilience. This is evidenced by the 18 million Chinese travelers who flocked to the beleaguered city during China’s National Day Holiday in 2020 to show their support. That year, the metropolis boasted a better-than-expected GDP performance and even jumped onto a list of new first-tier cities, boosted by a package of tax reductions, financial support, and new projects. Luxury brands noted this commercial potential too, with many names like Balenciaga, Loewe, and Alexander McQueen choosing Wuhan to launch their business in the regional market last year.
The story of Wuhan is still being written. For brands that want to be part of this narrative, here are some key things to know.
- Wuhan, the city hit hardest by the first wave of COVID-19, has largely recovered from the initial economic blow. Not only has GDP surpassed pre-pandemic levels, but the average disposable income for urban residents has also steadily risen. This growth, plus the rebound in tourists, means more opportunities for domestic luxury consumption.
- Because Wuhan luxury shoppers are generally newer to wealth, they tend to gravitate toward big name luxury brands. As such, niche players may have a tougher time breaking into the market, but should nonetheless not be put off.
- Wuhan boasts a network of shopping malls, each with its own specialty. For example, Wuhan International Plaza and Heartland 66 are go-to destinations for high-end luxury brands; Wushang Plaza is famous for selling cosmetics; and K11 offers unique art concepts to lure in trendy, young customers.
- With many luxury brands opening their first boutiques in Wuhan, in Heartland 66, consumers no longer needed to travel to nearby cities — Sanya or Macau — to buy goods that were previously unavailable here.
Wuhan’s key statistics
- $280 billion or 1.77 trillion RMB (2021), up 6.7 percent compared with 2019
- 8th largest GDP among provincial capital cities and municipalities in China (2020)
- 200 million (2019)
- In November 2021, Wuhan was the only city to receive more than 20 million tourists during the National Day holiday, ranking first in number of tourists and fourth in tourist consumption. During the same period in 2019, Wuhan received a record 22.6 million tourists, pointing to its tourism recovery since the pandemic.
In November 2021, Wuhan was the only city to receive more than 20 million tourists during the National Day holiday, ranking first in number of tourists and fourth in tourist consumption
Average disposable income
- $8,734 or 55,297 RMB per capita disposable income (2021)
- 11th largest per capita disposable income among major Chinese cities (2020)
- Many top luxury brands have stores in Wuhan, located at International Plaza, Wushang Plaza, and World Trade Plaza, which all fall under Wushang Group.
- Sales from these Wushang Group malls exceeded $2.35 billion (15 billion RMB) in 2021, up 50 percent year-on-year.
- Wuhan was selected as the first stop of Louis Vuitton’s “See LV” exhibition tour in 2020.
Who is the Wuhan luxury shopper?
Rising middle class: “The Relocated”
As Wuhan demolishes old suburbs to make room for its urban landscape, people living in areas undergoing construction have been generously compensated to relocate. This has become a shortcut to quick wealth and upward mobility, turning thousands of people into millionaires. In 2021, over 200,000 households were asked to move for the reconstruction of 300 villages.
This group of people is one of Wuhan’s main high-consumption drivers, eager to purchase posh cars, houses, and luxury goods to impress others. Newer to luxury shopping, they prefer big, recognizable names over emerging designer brands. As such, Louis Vuitton, Hermès, and Chanel are favored by these consumers to display their wealth. Long queues outside these stores are common in Wuhan’s high-end malls.
Wealthy Gen Zers
Wuhan’s Gen Zers — oftentimes children of “the Relocated”— are another major driver of luxury consumption in Wuhan. Thanks to the influence of social media, this generation is better informed about the latest fashion trends and emerging designers. They pay attention to outfits of celebrities and influencers and show preference towards collaboration pieces, streetwear brands, as well as luxury handbags and sneakers to match with more entry price point garments (Urban Revivo, Zara, Mango).
Because this demographic is attracted to newness and experience, Wuhan’s malls are frequently revamping their interior and product offerings. Bubble tea bars, exhibitions, pop-up stores, as well as blind boxes are quickly gaining popularity with this generation.
Japanese vintage culture has seen an uptick in China in recent years, especially among young consumers — both white-collar workers and college students — who have a limited budget but would still like to own a luxury handbag, as well as collectors who are looking for hard-to-find items. The phenomenon has taken hold in Wuhan too, where there are more than eight vintage stores: All Vintage, SanDingMu, Miii Vintage Boutique, Black Cat, Lava Vintage, Allu Vintage, Loved Vintage, and La Musée to name a few.
Most second-hand luxury handbags are half or one-third the original price, making them far more affordable to young spenders. The pandemic has also fueled this market, with many wealthy consumers selling their Chanel, Hermès, Louis Vuitton to vintage stores. While these brands remain the most popular value pieces in the market, some exclusive pieces may sell for higher than their original asking price. On the flip side, lesser-known names are less readily accepted by vintage stores.
Opened in 1996, Wushang Plaza is Wuhan’s earliest high-end department store and one of the most influential ones in China. Located on Jiefang Road — in the heart of the golden business district of Hankou — it is home to leading international luxury brands and local designer labels, making it the ideal destination for Central China’s fashion-forward consumers.
Wushang Plaza is also renowned as Asia’s leading beauty center, gathering more than 60 international makeup brands and 10 branded premium beauty salons, including La Mer, La Prairie, and Sisley. In 2018, these cosmetics brands helped generate over 900 million RMB in sales, helping Wushang Plaza defend its title of “number one department store for cosmetics” for the seventh consecutive year. In fact, a number of beauty players saw their top sales in China from this Wuhan location in 2018, including Estée Lauder, Dior, and Chanel.
Wuhan International Plaza
Right next to Wushang Plaza is Wuhan International Plaza, a department store opened in 2007. The building has three passages at each level connecting itself with the city’s other top malls — Wushang Plaza and World Trade Plaza — creating a mega shopping center that covers 220,000 square meters.
Famous for its high-end luxury portfolio, Wuhan International Plaza has welcomed over 300 brands, including 60 international brands, such as MCM, Coach, Bally, Salvatore Ferragamo, and Lora Piana. Yet, consumer favorites continue to be traditional houses like Louis Vuitton and Hermès, which occasionally boast hour-long queues outside of their entrances. In 2020, Louis Vuitton picked the Wuhan International Plaza for the first stop of its “See LV” exhibition, where it showcased over 80 museum pieces in celebration of its 160 year-long history.
Thanks to social media-friendly restaurants, emerging streetwear labels, and brand activations such as a Gucci x Doraemon pop-up store, Wuhan International Plaza has become another go-to spot for luxury consumers.
K11 Art Mall II, which was unveiled at the end of 2020, is one of the city’s most unique department stores and the first large-scale commercial complex opening in Wuhan since COVID-19. More than 30 brands have gravitated to this space to launch in Wuhan for the first time, including Armani Boutique and Nars. This development was quickly followed by the opening of K11 Art Mall I in 2021, which saw another wave of first-to-market stores from the likes of Stella McCartney, N21, Alexander McQueen, Gentle Monster, and Ubras.
But what makes K11 stand out is, of course, its artistic interior. Three interconnected circular chambers with retail stores wrap around K11 Art Mall II: a pink chamber showcases accessories in a museum-style setting; a yellow chamber draws on amusement park elements to market toys; and a sci-fi inspired blue chamber spotlights tech products. Meanwhile, K11 Art Mall I resembles a giant music box, with an atrium in the shape of a pipe organ, and offers a rooftop cherry blossom garden and musical Urban Farm to “strike a balance between city and nature.” Combining art and commerce, both buildings create fun, engaging shopping experiences.
In March 2021, Hang Lung Properties, known for building Shanghai Plaza 66, entered Central China with the opening of Heartland 66. Sitting on Jinghan Avenue in the bustling Qiaokou District, the commercial complex includes a world-class shopping mall of 177,000 square meters, an office tower, and serviced apartments.
Sporting the slogan “The New Generation of Luxury in Wuhan,” Heartland 66 offers an assortment of high-end and accessible luxury brands. For Balenciaga, Celine, Loewe, Berluti, Pomellato, Mulberry, and Hublot, this mall is their first store in Central China. For Chaumet, Fred, Vacheron Constantin, Montblanc, Marc Jacobs, and Longchamp, it is their first home in Wuhan. Chen Qizong, Chairman of Hang Lung Properties, expects this Wuhan location to surpass Wuxi and Kunming within two years to become the shopping mall with the highest sales outside Shanghai.
World Trade Plaza
World Trade Plaza is located in Wuhan’s landmark building — World Trade Plaza Tower — one of the city’s tallest buildings at 60 floors high. The shopping mall was established in 1999 and covers an area of 80,000 square meters. Although not as prestigious as the other retail spaces on this list, World Trade Plaza is known for selling jewelry brands like Lukfook Jewelry and King Tai Fook Jewelry. Wuhan residents told Jing Daily that this is a place where older women (around 40-50 years old) like to shop.
What Wuhan residents say about luxury shopping
Offering innovative cultural-retail experiences and an extensive portfolio of brands, these locations elevate Wuhan’s luxury market and cater to Central China’s high-spending demographic. Here’s what local consumers had to say:
“Many luxury brands opened their first boutiques in Wuhan in Heartland 66. I don’t need to travel to nearby cities, Sanya, or Macau to buy goods that were previously unavailable here. Also, there’s still nuance between travel consumption and purchasing something in the city where I live. I can build closer relationships with local salespeople and they can have exclusive offers such as pre-sale and pre-order. —Ms. Li, High-end shopper, female, age 30+
“The interior design and merchandising of the newly opened K11 are very modern and social media friendly. Brands like Gentle Monster have really cool installations in the shop which allow me to take great photos. I really enjoy hanging out with friends and family there though I don’t have specific shopping plans.” —Bryan Zhou, Gen Z college student, male
“I’ve seen the city experience a rapid recovery from the pandemic situation, especially when it comes to the retail sector. There were basically only two shopping destinations in Wuhan, namely Wushang Plaza and International Plaza. I would say consumers my age may still be used to shopping in traditional malls, but the younger generation prefer those with more vibrant vibes.” —Ms. Lu, High-end shopper, female, age 50+
What retailers say about Wuhan
Although large-scale developments have spurred local consumption, business insiders noted some factors brands should consider before entering the market, from the potential of certain districts over others to consumer preferences.
“Population is the primary advantage of Wuhan. In the past decade, Wuhan has added 2.54 million people, ranking ninth [in terms of population increase] among all cities. In addition, there are many famous universities there, with abundant educational resources and high population quality. The city also has a large number of excellent Internet top enterprises, including Xiaomi and 360. I think Wuhan is the most promising city for China’s digital economy in the next decade. But if a brand wants to develop well here, it will only survive with unique features.” —Ren Qin, founder of a second-hand luxury watch platform
“Wuhan’s main economic and consumption centers are in Hankou. If you want to do business in the city, it’s better to choose a location in the Hankou district. There are many high-end shopping malls and several white-collar classes here. The market consumption is larger than Wuchang District. Wuchang generally has a low consumption because there are many students. There are many traditional government departments. Many of my friends opened clothing stores in Wuchang but will close down soon.” —Wanhao, Wuhan clothing wholesaler CEO
If you want to do business in the city, it’s better to choose a location in the Hankou district. There are many high-end shopping malls and several white-collar classes here.
“Wuhan is an ideal city for luxury to enter because most local consumers recognize the popularity of the brand. On the contrary, niche brands may struggle, particularly those that are expensive (more than 3000 RMB) but not so recognizable by the public. Especially after the pandemic, people are more cautious about money consumption. It’s not easy to restore purchasing power in a short time.” —Doe, founder of Wuhan mspace buyer store
Reported by Emma Li, Lisa Nan, Wenzhuo Wu, and Julienna Law.
Source Credit: This article originally appeared on Jing Daily by Jing Daily. Read the original article - https://jingdaily.com/city-guide-wuhan-key-stats/