Luxury brands are going all out to win over the top 1% of their clientele.

According to a joint report by Bain & Company and the Italian luxury goods association Altagamma, there are currently 400 million luxury consumers globally, but VICs (Very Important Clients) account for less than 1% of this group while contributing a staggering 30% of the total revenue for luxury brands.

Over the past decade, capturing the middle-class consumer has been a core strategy for luxury brands, providing a significant market boost and driving stock prices upward. However, changes in the global macroeconomic environment have caused the once-aspirational middle-class to become more cautious with their luxury spending. Although they still have disposable income, they are concentrating their spending on fewer brands and reducing their overall luxury budgets.

This year, many industry insiders have noted the increasing difficulty of acquiring new customers for luxury brands, shifting the sales burden onto the wealthier core VIC clients. These clients have not reduced their spending—in fact, their purchasing power continues to grow. Hongkong Land, for example, revealed that its most loyal users contribute 80% of its mall membership sales, with their average spend reaching HKD 1 million in 2023, shopping as often as every two weeks.

One luxury shopping mall in China previously saw new customers contributing 30% to 35% of sales, but that has now dropped to around 20% to 25%. This means that the mall’s core VIC customers are now responsible for a whopping 75% to 80% of sales, which has caught the attention of the entire industry.

The pandemic left the domestic luxury market with a group of price-insensitive consumers. Despite the significant price difference between luxury goods in China and abroad, these consumers have stayed loyal even after international travel restrictions were lifted.

Analysts point out that in China, luxury VIC customers are mainly aged 30 to 45. With significant financial resources, they previously preferred to shop overseas but developed local shopping habits during the pandemic, forging strong relationships with specific sales associates.

Given that some brands base their VIC rankings on spending levels, many high-net-worth customers find it challenging to compete with daigou (personal shoppers) in overseas markets. This, along with language convenience, drives them to prefer shopping domestically.

As Chinese consumers resume traveling abroad, purchasing luxury goods in places like Japan, the competition among luxury brands in China has shifted to capturing this core group of "one-percenters."

Read more on China Luxury Market Consumer Preferences

Luxury brands are gradually refocusing their sales efforts away from the middle class and toward high-net-worth individuals.

In April, Louis Vuitton’s new fashion show at Shanghai’s Long Museum marked an upgrade in their VIC strategy. For the first time, the brand’s exclusive resee event—usually reserved for media and VIC clients—was opened to a broader audience.

The term "resee" refers to an event held the day after a fashion show, where the showcased clothing and accessories are displayed for media and VIC clients to view up close and place orders.

Louis Vuitton further expanded its strategy by hosting a live-streamed resee event on Xiaohongshu (Little Red Book) two days after the show, offering viewers an immersive experience from the fashion show to the resee, inspiring a desire among more consumers for the VIC experience.

VIC clients, however, still enjoyed exclusive perks, such as attending the fashion show and placing pre-orders during the resee event. Louis Vuitton took it further, touring the new collection across five cities—Beijing, Chengdu, Hangzhou, Guangzhou, and Nanjing—before the series became available in stores in mid-May.

Luxury brands are shifting their focus from the middle class to high-net-worth clients, highlighting a broader industry trend.

From Creativity to Sales: The New Role of Fashion Shows

Fashion shows, once considered purely creative presentations, have now transformed into pipelines for converting creativity into sales. Chanel, understanding this shift, recently announced two fashion shows in Hangzhou and Hong Kong at the end of the year, following last year’s successful show in Shenzhen.

Fashion shows, once viewed as brand investments, are now essential for maintaining relationships with VIC clients, providing them with exclusive experiences while driving sales.

Chanel’s Fashion Division President, Bruno Pavlovsky, noted that the brand’s annual Métiers d'Art and Cruise shows, held in December and May, respectively, are now more lucrative than the main ready-to-wear and haute couture shows held in Paris. These events are key moments in Chanel’s fashion calendar, focusing on identifying affluent local customers in wealth hubs like Shenzhen, Hangzhou, and Hong Kong.

However, in addition to balancing the needs of both VICs (Very Important Clients) and the general public, as well as aligning brand image with actual business goals, luxury brands are increasingly focusing on small-scale events tailored to VICs, given the higher return on investment.

According to industry insiders, many luxury brands have shifted marketing budgets from mass marketing to small-scale, exclusive VIC events. Through frequent, intimate salons and cocktail receptions, they provide VICs with one-on-one, customized services.

For example, Italian luxury menswear brand Zegna recently launched a new temporary experience called **Villa Zegna** in Shanghai. Open for just one week to invited guests only, this project went beyond the typical pop-up store concept. It was inspired by the original home of Zegna's founder in the Oasi Zegna nature reserve in northern Italy. The goal was not only to showcase Zegna's unique brand culture but also to create new opportunities for business conversion.

Recently, many consumers have reported being invited to in-store events by brand sales associates, even with minimal purchase history. In most cases, consumers find these events appealing, as many are transitioning from chasing trendy items to developing a deeper understanding of the brand's culture.

Another insider mentioned that these events often do not have high sales targets. The primary goal is to invite consumers into stores and maintain interaction with the top 1% of customers. After all, nearly every brand is competing for their attention, and these VICs have a multitude of choices.

In reality, to win over this elite 1%, it is not enough to offer personalized services and exclusive experiences. VIC customers in the age of social media also desire visibility for their experiences. Being invited to luxury brand events serves as social capital for VICs. They continue to shop locally because their friends and social circles are also shopping at the same brands and malls.

Beyond the occasional fashion shows and exclusive dinners, these clients want to showcase their ability to enjoy luxury brands’ offerings in their daily lives. In recent years, the rise of luxury brand VIC salons has catered to this psychological need.

For example, Chanel has opened exclusive VIC salons in high-end commercial centers like Beijing SKP, Shanghai Plaza 66, and Shenzhen MixC. The investment in Shenzhen MixC alone reached RMB 43 million. The brand plans to continue expanding its VIC salons across Asia, Europe, and the United States.

Recently, Hongkong Land announced the launch of the Tomorrow Central Project, which will completely renovate Hongkong Land Plaza with an estimated investment of USD 1 billion (HKD 7.8 billion). Of this, Hongkong Land will invest USD 400 million, while luxury tenants like Louis Vuitton and Hermès will contribute USD 600 million. This tenant investment, surpassing that of the landlord, highlights luxury brands' urgency to enhance their in-store experiences.

Hongkong Land aims to help these brands build large flagship stores, with some spanning up to eight floors, offering expanded retail spaces. Some brands will open haute couture ateliers, introduce private dining services, and launch VIC salons. Four brands will even have the opportunity to unveil their first-ever outdoor terraces.

Luca Solca, a senior luxury goods analyst at Bernstein, believes that the preference for VIC clients is a major factor driving luxury groups to invest heavily in prime real estate.

Data shows that over the past five years, luxury groups have invested EUR 10 billion in retail real estate, focusing on prime shopping streets like Via Montenapoleone in Milan, Champs-Élysées in Paris, and Fifth Avenue in New York—locations highly favored by affluent shoppers.

The preference for VIC (Very Important Client) customers has been a major reason behind luxury groups’ recent rush to acquire prime real estate.

Whether through high-cost fashion shows, quick and exclusive in-store events, or leveraging digital tools and retail experiences that are optimized for social media, these strategies have become standard practices for keeping high-net-worth VIC clients engaged. They are an integral part of the luxury experience. According to a report by Bain & Altagamma, the trend of consumers favoring luxury experiences over physical luxury goods continues. With the recovery of the tourism industry and growing demand for immersive experiences, sectors like hospitality and fine dining are seeing steady growth.

Upgrading retail experiences and maintaining strong relationships with VIC clients has become a common goal among luxury giants. However, it’s important to note that over-reliance on experiential marketing can be a pitfall. The rise of experience-focused offerings could signal a lack of creativity in luxury goods themselves.

Many VIC clients have mentioned that, in recent seasons, they’ve been less attracted by the products showcased at luxury brand ordering events. Often, they place orders simply to maintain their VIC ranking or to sustain their personal relationship with sales associates, ensuring continued invitations to brand events and maintaining their social capital.

This highlights a risk: while luxury brands rely heavily on the top 1% of their clients, the relationship between the two is not as stable as it seems. There’s always the potential for a split.

Luxury brands cannot afford to sacrifice product innovation in their pursuit of experiential marketing. While global luxury consumption has weakened due to economic factors, a lack of compelling products, uninspired designs, and excessive homogenization are also to blame. These issues are frequently criticized on social media and are likely contributing to the loss of middle-class consumers.

More importantly, while catering to the top 1%, luxury brands must not overlook their aspirational middle-class customers.

According to Bain partner Federica Levato, luxury brands should adopt a dual strategy—focusing on top-tier clients while also embracing niche luxury offerings—to drive growth at both ends of the pricing spectrum.

As market volatility continues, the winners will be those brands that can rethink how to deliver value at different price points and touchpoints, expanding their influence while also fostering customer loyalty.

The importance of VIC clients is undeniable, but in challenging times, luxury brands should adopt a more balanced approach—enhancing their appeal to top clients while also using product innovation to strengthen their broader customer base’s loyalty.

As the luxury industry becomes increasingly conservative, it must not forget that creativity remains the primary driver of growth.

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