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Sales attitude is the barometer of the economy.

arts｜Zhang Jing

edit｜Vivi

illustration｜Song

Source｜Houlang Research Institute (ID: youth36kr)

There is no "consumption downgrade", only "consumption cliff"

Customers "suddenly disappeared", whether from the store or from purchasing agents.

The number of random customers in luxury stores has dropped by one-third. This is one of the most obvious changes Xiaoyi has noticed in the past six months. Xiaoyi, 35, is a saleswoman at an LV store in a new first-tier city and has been selling luxury goods for more than ten years. This is the first time she has encountered such a market situation in her many years of work.

She has to achieve sales of over 1 million yuan every month, a KPI that is the same as in the past, but the pressure is particularly great this year. The middle class who used to spend 20,000 to 40,000 yuan in her store every year "almost disappeared" this year. "Many large factories have laid off employees, and it's hard to make money. People will spend more rationally."

"The worst market in history",Jiang Shuai, a luxury goods buyer who has been engaged in shopping for 11 years, described what he encountered this year in this way.

The golden decade of purchasing on behalf of others came to an abrupt end. The amount of purchasing he did on behalf of others in the first half of this year was only one-third of that of last year.

"Everyone is tightening their wallets. People who used to buy big items are now buying small items, and some people have stopped buying at all," Jiang Shuai told the Houlang Research Institute. Middle-class consumers in particular have become more rational in their spending.

He has always held a view:There is no "consumption downgrade" in luxury goods, only "consumption cliff". There is no such thing as a substitute. "People who buy Chanel will not buy MK even if they stop buying it."

Not only are soft luxury brands such as luggage and clothing experiencing a downward trend, the market conditions for hard luxury brands such as jewelry and watches are also not optimistic.

Yan Di, a salesman at a Rolex store in South China, also clearly felt that there were fewer customers who came to the store randomly. Although his store did not have clear performance requirements, it was stricter in serving customers. When there were no customers, they spent time on customer service training, practicing the "eight reception processes" over and over again: welcome approach, explore needs, recommend trial wear, introduce products, discuss prices, resolve doubts, facilitate transactions, and thank and say goodbye.

Although he is familiar with all 13 series in the store, including the history, materials, design, workmanship, etc. of each watch, he can answer customers' questions at any time.But some customers never even take that step. They just come in to take a look without having a conversation, and there is even less chance of understanding their needs.

"In the past, customers would come in and buy what they liked, but now the number of customers who come to the store randomly or actually buy has been reduced by half," said Lielie, a sales representative (SA) working for a luxury watch brand in Shanghai. Not only are there fewer individual customers, but the amount of spending by VICs (Very Important Clients) is also decreasing."I used to buy two or three watches in three months, but now I buy one or two a year."

A sentence is frequently mentioned in the luxury goods sales circle——"This year may be the best year in the next decade."

This was also confirmed by the first half financial reports released by major luxury groups some time ago. Simply looking at a few sets of figures, the world's largest luxury group LVMH's revenue and net profit both fell in the first half of this year, with revenue down 1% year-on-year and net profit down 14% year-on-year; Kering Group, which owns brands such as GUCCI and YSL, saw its net profit halved, with revenue down 11% year-on-year in the first half of the year and net profit down 51% year-on-year; Burberry's retail sales in the first quarter of fiscal year 2025 ending June 29, 2024 also fell 22% year-on-year.

"Do you want to continue?"

The performance pressure is equally borne by the sales terminals of each luxury brand - the store SA.

The Chanel counter in Beijing International Trade Center is where 29-year-old Yuanyuan worked for two years. She had to achieve sales of 2.5 million per month, which means the daily sales target was at least 100,000. If she couldn't finish it on weekdays, she would work overtime on weekends to complete it.

After closing the store at night, the SA will report their performance in the group. If they don’t sell enough today, their performance will be much lower."The supervisor will ask you why you have so many orders left. I usually explain why some orders were not completed. I also need to write 'guarantee to improve the performance' later."

Sometimes the supervisor would accept the reason for the poor performance, but sometimes he would not accept it and would continue to ask, "Why did she only look but not buy?"

"I just made up stories and blamed myself for not understanding the needs of the customers." However, the anxiety was piling up every day, "because the performance you missed yesterday needs to be made up every day in the future."

Yuanyuan admitted thatThe situation in which people online questioned the salesgirl’s unhappy expression does exist."When performance pressure is high, if you don't buy and waste her half a day's time, she will accumulate more pressure for the day."

Her life was very irregular. She often ate at two or three in the afternoon and had dinner after ten. Once she had gastric bleeding, and the doctor warned her that she could not continue like this.

In April last year, she finally decided to resign from Chanel and bid farewell to the sales job that made her anxious as soon as she opened her eyes.

On Xiaohongshu, Jacob@天才J, who resigned from a hard luxury jewelry brand at the beginning of last year, posted a post saying that he found that many salesmen and saleswomen in his circle of friends had resigned. More than 500 comments appeared under the post, which resonated with many people.One salesgirl said that this job caused her breast hyperplasia to turn into breast nodules.I dream of closing deals and inviting members, and my supervisor asks me all kinds of “whys”. “It’s so suffocating.”

Some of the resigned salesgirls have quietly switched to the funeral industry. She said, "I used to cling to customers, but now I wait for them to come to me. I no longer have to make phone calls or return visits."

Jacob, 27, has worked for two luxury groups, Richemont and LVMH. He told the "Houlang Research Institute" that before leaving, everyone went through a process of salary reduction.

"When the business was good, I could earn 30,000 or 40,000 yuan a month. Now, it's good to earn over 10,000 yuan a month." Jacob said that when the market performance is not good, the brand's strategy is to constantly push the sales end, the top management pushes the regional manager, pushes the store manager, pushes the sales, and the brand will choose to squeeze the labor cost infinitely."Especially in China, if you quit, someone else will take over."

But for the 27-year-old Jacob, the lack of a promising career path forced him to leave. "The middle and senior management of luxury goods are all born in the 1980s. They have experienced the most glorious 20 years in the Chinese market. They have been in this position for a long time. It is difficult for young people to move up," he said. He felt that young people should also match their own values. Finally, he decided to leave the SA position and become a regional manager of a high-end clothing brand.

However, more people choose to say goodbye to their sales jobs. The salesmen who feel hopeless say that they feel alive again after leaving their jobs. And those who are still working are jumping back and forth between leaving their jobs and staying put every day.

People started to compare their misery online. A salesperson in Nanjing received less than 400 yuan in July after deducting five social insurances and one housing fund. He almost "fell to the ground" after seeing the salary slip. A saleswoman with a sore back after standing all day and not making a single order all day, joked that she"Today is another day of being a doorman, cleaner and guide."

The salesgirl asked a soul-searching question online: "Do you want to keep going?"

Good times for those who are reluctant to leave work

Which SA doesn’t miss the good old days when you could achieve results with your eyes closed?

In 2021, after working at LV for three years, Yuanyuan switched from LV to Chanel as a saleswoman with the idea of ​​a salary increase, earning more than 20,000 yuan a month. She also caught up with the epidemic bonus period of the Chinese luxury goods market.

In the early days of the pandemic in 2020, the luxury goods markets of various countries were greatly affected, but the domestic market in China was the only one that stood out. Many buyers were unable to go abroad and could only buy luxury goods domestically. According to an article published by 21st Century Business Herald, according to Bain statistics, in 2020, the domestic market accounted for 70% to 75% of Chinese consumers' global luxury goods consumption, a record high.

In the three years starting from 2021, global luxury goods are in a honeymoon period, and luxury groups such as Hermès, LVMH, and Richemont Group have achieved three consecutive increases in revenue.

"Most people were trapped at home by the epidemic and could not go abroad for mass consumption. All industries were in a slump, but luxury goods were the only ones that sold out." Xiao Yi still remembersAt that time, I was so busy in the store that I "didn't want to leave work". Sales were all delivered to the door, and I couldn't handle all the customers. The process for customers to buy bags was basically "check it online, take the picture and order the bag."

During the three years of the epidemic, Xiao Yi didn’t have to worry about performance at all, and his income also increased rapidly. At the best time, he earned 20,000 yuan a month.

At that time, among the super VIP guests of Jiang Shuai, a senior luxury buyer,A female customer gave him a shopping budget of 600,000 yuan per year. He had all the sizes of clothes and shoes for this customer. As long as the new styles of each season were suitable for the customer, Jiang Shuai would take pictures and send them to her. "She would buy 70% of the time."

Jiang Shuai told the "Houlang Research Institute" that Hermès's stock ratio was also very high in the past few years. "Under normal circumstances, a 1:1.5 ratio for a diamond-colored Birkin is considered normal, but during the epidemic, it was 1:2.5." The high stock ratio was particularly evident in China.“You send a message to SA, and he may reply if he wants to, or not reply if he doesn’t want to.”

Yuanyuan is not only a seller of luxury goods, but also a consumer of them. She buys five or six bags a year, with the motto "the company makes money and the company spends it". She has almost all the popular Chanel models, and now there are more than 20 bags in her cupboard. Not only bags, she is also willing to buy expensive jewelry and shoes that cost 7,000 to 8,000 yuan a pair. "You work in a luxury store, so you don't even like the things in ordinary stores."

During the years she worked as a salesgirl, Yuanyuan’s salary was always spent every month, but she felt that her spending was still rational, “at least I didn’t use my credit card.”A colleague of mine used a credit card to buy a bag and "owed hundreds of thousands of dollars on the credit card."

Sometimes she would show her impatience when customers came into the store just to look but not to buy, and she couldn't help rolling her eyes after the customers left."We usually buy things very happily, why is it so difficult for you to buy this?"It was not until she quit Chanel and became a fitness trainer that Yuanyuan realized she had fallen into a consumer misunderstanding. "At the age of 23 or 24, working in this industry, it is easy to be blinded by vanity."

Jacob, who was working as an SA for a hard luxury brand at the time, still remembers that after customers came into the store, they could close deals without much sales skills. "During the reception process, the customer showed that he really liked the product and wanted to buy it."

"At that time, the average monthly salary in Shanghai was 30,000 to 40,000 yuan," Jacob said. People at that time had confidence in their expectations for the future, especially the middle class. It was acceptable to buy two bags a year and give themselves a 50,000 yuan watch as a year-end bonus.

The sense of relaxation that comes from consuming luxury goods is even more evident among VIC guests.Many of the VICs that Lielie received only carried canvas bags and came in to consume just to "show their appreciation"."If he enjoys the chat and recognizes you as a person, he will sit for a while, drink some coffee and eat something. But you can't waste your time, so just buy something to show your appreciation," said Lielie.

At present, all the previously established operating rules are slowly loosening.

Now we must learn to take the initiative

There is a saying that has been circulating among the people: SA’s attitude is the barometer of the economy.

This is so obvious - the sales clerks and saleswomen no longer rolled their eyes, and they even started talking about the value of emotions.

Before Chinese Valentine's Day, the "Houlang Research Institute" visited two luxury shopping malls, Beijing World Trade Center and Beijing SKP. The salesgirls and salesmen in the luxury stores were very friendly, and many popular models of bags and watches were in stock and could be purchased and picked up at any time.

Some SAs are even more "emotional" to customers. At the DIOR counter in Guomao, we talked to the salesgirl about our work pressures. She acted calm and responded enthusiastically: "Don't put pressure on yourself, just let it go," she warned us.Women should not define themselves arbitrarily. Women of any age deserve to take away a DIOR Princess Diana bag.

One customer clearly noticed the change in the salesgirl. "She patiently answered a bunch of questions and even asked me if I wanted it wrapped." The customer finally straightened up. "The look in her eyes was very firm and calm."

The distribution mechanism of some brands has also been loosened.

Jiang Shuai, a luxury goods buyer who has met many salesgirls and salesmen, said when talking about Hermès' current allocation of goods, if the sales clerk is in a good mood, he can give you some styles, or symbolically buy two scarves, and there is no need for allocation of goods at all. The allocation ratio of popular styles used to be as high as 1:2.5, but now it has dropped to 1:1.5.

“Can’t be picky about customers”Lielie believes that this is a very important professional accomplishment for SAs. With performance pressure ahead, it is crucial to seize any customer, whether it is a casual customer or a big customer.

Brands have tried almost every possible way to do CRM (customer management) to attract new customers and maintain major customers.

Now, after work every day, Lielie spends half of his time doing role-playing sessions, practicing how to better serve customers. "Although these were also part of my daily work before, as the economic situation gets worse, our role-playing sessions have become more and more important."

First of all, maintaining VIC customers is the top priority of every SA."When the environment is bad, everyone must take good care of the fish in their ponds.Lielie said that consumption in VIC can still be "rolled up." "These customers are not very sensitive to the environment and price, but they have high requirements for service. If you maintain a good relationship with them and provide good service, they will still pay."

According to a report released by Bain & Company, there are 400 million luxury consumers in the world, of which VIC customers account for less than 1%, but they contribute up to 30% of luxury brand revenue. It is reported that the most loyal VIC customers of a luxury shopping mall in China now contribute up to 75% to 80% of sales performance, and VIC customers are becoming increasingly important in boosting sales.

In the past two years, brands have been actively working to maintain their big customers. For example, brands have held various private cocktail parties and VIC salons for top super VIP customers, and there are more and more VIC ROOMs for big customers. Chanel, LV, Cartier and other brands have successively established VIC ROOMs in China in the past two years.

It is far from enough to just be "upwardly social". For a luxury brand, it must also be "downwardly compatible" and strive to reach more consumers.

In addition to maintaining core customers, Lielie's main job now is to sell goods through live streaming in the store. The watches in the live streaming room range in price from tens of thousands to millions. She saw netizens quietly placing orders in the background to buy watches worth tens of thousands. "After doing the live streaming business, you will find that this is a very effective sales method," but Lielie is reluctant to talk more about the impact of live streaming on the brand's tone.

More and more sales assistants have started to operate their own social media accounts. They will post their outfits, new product recommendations, and user experiences on their WeChat Moments, Xiaohongshu and other platforms.

Yan Di, a salesman at Rolex, has been running his own social media account in the past two years. Sometimes he doesn't receive a single customer in the store for two hours, as he prefers to spend his time online. He shares his outfits on his social media account, and every once in a while, he invites online friends to shop at his store. Customers come from all over the world, and some even come back from abroad to buy.

The era of just waiting for customers to come into the store is over, Yan Di said, "Now we have to learn to take the initiative."

"If you can't even survive, what's the point of talking about tone?"

The only compromise that the first-tier luxury brands that take the initiative refuse to make is to lower prices.

Previously, price increases were a recognized and effective marketing strategy for these luxury brands. Brands can raise prices whenever they want, and consumers will buy more as prices rise. Price increases have become a "rule of loyalty" for luxury brands.

Chanel, which is well-known to everyone, has a strategy of raising prices twice a year, spring and autumn. In March this year, it raised product prices worldwide, with the CF series and 2.55 handbags increasing by about 5%. In July this year, LV also saw a full-line price increase in Chinese stores, ranging from 3% to 6%. According to incomplete statistics, LV has raised prices no less than 10 times in the past three years. Before each brand raises prices, stores will "force out" a group of consumers who want to buy bags before the price increase.

Even in the bleak market environment two years after the epidemic, the brand still refused to cut prices. Although Xiaoyi, a saleswoman at LV, had extremely poor expectations for the future, she still vowed that LV would not cut prices. Lielie also believed that discounts were not attractive and that discounts would damage the brand, and this damage would be difficult to recover.

But there is also a voice in the market:Faced with the frequent price increases of luxury goods, more consumers say they are becoming less and less able to afford them.Especially for mid-range luxury goods such as Burberry and YSL, the trend of price increases has caused consumers to gradually abandon them. According to reports, Burberry and YSL have recently lowered the prices of some bags to cater to consumers by reducing prices.

It is undeniable thatIt’s not that consumers don’t like to buy anymore, but they pay more attention to cost-effectiveness.

Hermès also suffered from a slowdown in growth. The financial report for the first half of this year and the second quarter released by Hermès at the end of July showed that the revenue growth rate in the Asia-Pacific region in the second quarter was only 5.5%, a significant slowdown from 14% in the first quarter.

More and more high-net-worth individuals are beginning to get tired of Hermès’ underlying “allocation mechanism”.In an interview with the "Houlang Research Institute", several customers who have shopped at Hermès counters revealed that some popular bag models only require 0.5 or even 0 matching items to get them.

The wealthy who once received more than twice the amount of goods allocated to buy a bag are also worried about the unused items such as Hermès accessories and tableware that fill up their cupboards. Jiang Shuai, a senior buyer, is currently brewing a new plan: how to revitalize Hermès's allocation and help these expensive unused items flow to places where they are more needed.

The strong purchasing power of ordinary consumers who are sensitive to prices has exploded frequently this year, which brands cannot afford to underestimate.

At the beginning of this year, affected by the depreciation of the yen, Chinese consumers went to Japan to shop. Even without tax refunds, the price of a LV handbag in Japan is equivalent to 20% off in China, and some luxury brands are even as low as 40% off. The sales of LVMH Group, the luxury group to which LV belongs, in the Japanese market increased by 44% year-on-year in the first half of the year.

The Chinese have turned LV into a Japanese specialty, truly worthy of the name.

In China, at the beginning of August, three luxury shopping malls in Wuhan launched a "store king competition", abandoning the "tone" and persistence of high-end shopping malls and launching a price war. The three high-end shopping malls basically maintained the discount at around 15% through promotional means such as coupons for full discounts and multiple points. Brands including LV and GUCCI were actively or passively involved in this price war.

This business war has slightly released a wave of Chinese people's purchasing power.Customers, purchasing agents, scalpers collecting coupons, etc. who flocked in from all over the country turned a high-end shopping mall into a vegetable market.

In my lifetime, I can actually buy LV at a 15% discount in domestic counters, said a netizen who has been to the scene. Han Li, who lives in Wuhan, contributed 30,000 yuan to this discount event even though her income shrank by 20% last year. She bought an LV ONTHEGO handbag at Wuhan Henglong, added a scarf and fragrance to make it even, and changed to a pair of GUCCI sunglasses. In the end, it was about 16% off. Her consumption process was extremely short, and she did not feel the distinguished service experience that she would enjoy when consuming luxury goods. She only stayed in the store for a few minutes, selected the model, and quickly bought it and went out for coffee.

Faced with the rare discounts of LV in China, the attitudes of LV salesmen in different regions such as Wuhan, Beijing and Tianjin were surprisingly similar:The promotion is owned by the mall and the brands are just forced to participate.

Luxury goods have an ambiguous attitude towards promotional activities. Some netizens concluded that big brands participating in discount activities are both having it and wanting it."I sold things, made some money quietly, and maintained my superior feeling."

Yan Wei, partner of Roland Berger Management Consulting, said in an interview with "First Financial Daily" that the strategy of continuous price increases will not be applicable to most brands in the future. Instead, they need to adjust prices to adapt to the market. Brands that originally relied on a large number of consumers at the bottom of the pyramid will begin to "rationalize prices", that is, reduce prices.

In the opinion of sales clerk Yan Di, for luxury brands, whether it is online live streaming or requiring SA to manage their own social media, these customer acquisition sales methods have an impact on the brand's tone. However, when a brand's survival is in trouble, the most important thing is to survive.

"If you can't even survive, what's the point of talking about tone?"

(Except Jiang Shuai and Jacob, all other interviewees are pseudonyms)