Luxury Giants Tap into Mainland Market

Jiang's other concern is that, by opening its arms to the middle classes, Lafayette may risk alienating its more privileged customers in a society where the wealthy insist on being treated accordingly.

It's not that Lafayette isn't taking note, according to Chemla. In fact, he's aiming for exclusivity, as evidenced more by the products than the price tags.

"Our Beijing store is focused on new and exclusive fashion brands," he said. "It carries around 500 brands. Of these, roughly 300 are directly imported and operated by the brand's own staff. The main reason for that is that the majority of them - around 200 - did not have any prior presence in China ... this goes hand-in-hand with our strategy to be the place where new brands and trends are launched in Beijing."

Chemla's determination to end the seemingly endless repetition of brands in many Chinese stores is shared by Andrew Keith, president of Lane Crawford, who has made the showcasing of emerging industry talents an anchoring point for his new store, which covers 14,000 square meters on Shanghai's high-tone Huai Hai Zhong Road.

"In China we see an increasing awareness of brand and product exclusivity," he said. "The Chinese are looking for brands that are relatively rare in the market."

"Rarity with renown" seems to be Lane Crawford's selection criteria when it comes to niche international designer labels. Chosen designers include Proenza Schouler, Jason Wu and Alexander Wang. Their popularity, Wu and Wang especially, among the Chinese fashion pack, is ably testified - probably to their delight and dismay - by the number of fake items being sold under their brand names on China's major online shopping portals.

'Edge with pedigree'

"Admit it or not, what the young generation of Chinese fashionistas is looking for is 'recognizable cool', meaning 'edge with pedigree'" said Jiang. "They want to look effortlessly stylish, but at the same time they are reluctant to spend thousands on an item that fails to elicit the envy of their peers."

When asked how Lafayette Beijing will make up for lost social cachet when compared with the flagship store, whose innate charm lies in its Parisian location, Chemla said, "The way the Beijing store is organized is very focused on a 'mix-and-match' attitude ... This is very French!"

"We are targeting all customers who love fashion and look for a unique lifestyle to enjoy life. From this aspect, the Beijing store shares the same customer base as the French store," he said. "At the same time, the Beijing store will make Galeries Lafayette available to Chinese consumers who don't have the opportunity to go to Paris often."

In response, Jiang offered his own advice for foreign-based retailers looking to establish a base in China. "Go to the second-tier cities," he said. "That's where all the money has come from."