My favorite term of the moment is tubaozi – potato dumpling. I’ve been hearing it a lot lately to describe the problem brands have when unsophisticated but monied provincial classes come to town decked head-to-toe in Louis Vuitton (LVMH; MC.Euronext) or Burberry (BRBY.LSE). Such ghastly sights do little for the luxury brands’ reputations with the city-slicker Shanghainese! And so Shanghai joins the modern world in yet another way – London has the Essex Girls, New York has the Bridge and Tunnel crowd, and now Shanghai has its Potato Dumplings.
The dumpling crowd
There’s a lot of talk about the vagaries of food pricing in China these inflation-hot days. But everyone in the non-food business is raising prices right now, too. Why? Spiraling costs? No, it’s because they can. Chinese consumers are seemingly willing to pay more. Look at Apple’s (AAPL.NASDAQ) erratic pricing. Or take the newly opened Gap (GPS.NYSE) store in China – “Limited Edition” jeans for the lucky, lucky price of RMB888 (US$133). Or, the (we can only assume) unlucky price of US$65 on the US Gap website. Personally, I’ll take the bad luck denims at US$65. How soon before the Chinese shopper takes umbrage at this gouging?
Prices are a little better in Hong Kong – being duty free and not having “luxury taxes” helps. Still, you’ve got to love the Hong Kong propensity to really want to buy winter wear. The weather could hardly be described as cold, yet shop windows are still full of thick winter coats, boots and scarves that would have you sweating in Helsinki, let alone Happy Valley. But the good folk of Mong Kok and Causeway Bay valiantly try to wear scarves when the temperature dips chillingly below 25 degrees Celsius – a reminder, as if we needed one, that fashion and reality rarely walk along the same street in Hong Kong.
As reported here previously, the sportswear fad seems to be rapidly dying in China’s tertiary cities. This can only be a good thing – China has been looking uncannily like Liverpool city center on a wet Saturday for half a dozen years now, and it’s been a bit depressing. So it’s great to see the fast fashion brands expanding rapidly. But how long before we get the fight back from the sports brands we’ve seen elsewhere as they try to “crossover” with fast fashion? Hong Kong already has Adidas’ (ADS.FWB) Y3 collection from Yohji Yamamoto and another by Stella McCartney, while Puma (PUM.FWB) has launched the Black Store concept. How long before Li-Ning (2331.HK), Anta (2020.HK) and Hongxing Erke (BR9.SN) jump on the sports/casual crossover bandwagon in China? About a month or two, I reckon.
I was almost sold a pack of chewing gum recently. Almost, but not quite. I confess to hating chewing gum and people who insist on masticating wildly in my presence. It’s quite revolting and makes a mess of the streets. I’m with the Singaporeans: Ban the junk. But the Wrigley’s rep I met had a different pitch – it’s not gum, it’s a dental health aid! Yes, apparently Wrigley’s is helping to promote dental hygiene and good tooth education in China. How exactly they will do this was far sketchier and decidedly less scientific, but that’s the pitch. My suggestion that toothpaste, toothbrushes and regular visits to affordable dentists might be better was met with guffaws of incredulity. It’s a funny old world where the one-time rotters of teeth in the West become the saviors of precious molars in the East.