Luxury-goods sales in China are growing furiously. In 2004, Chinese consumers spent $2 billion in luxury purchases; last year, they spent about $15.6 billion.
That puts China on course to become the world's largest luxury market by 2015.
Demand has increased faster than knowledge about luxury brands, creating vast opportunities for PR professionals such as Elan Shou, managing director, China and senior VP at Ruder Finn. She helps fill in the gaps through events, media coverage and branded experiences so luxury shoppers better understand the heritage of the brands they're buying. Brands she works with include Mont Blanc, Four Seasons Hotels and Cartier.
Ms. Shou also advises foreign companies to learn about Chinese consumers and overcome their misconceptions -- such as the belief that Chinese are too poor and thrifty to buy top-of -the-line products.
"Chinese are very confident and most expect to spend as much or more on luxury goods sales this year as last year," said Ms. Shou, referring both to China's super-rich and its aspiring middle class.
China added 193,000 millionaires last year, bringing the country's total to 1.4 million and making China No. 3 in number of millionaires, behind the U.S. and Japan. China's uber-rich splurge on luxury brands, but aspiring middle-class consumers now make up 51% of China's luxury consumers, a number that will rise to 61% by 2015, according to McKinsey.
Many Chinese earn between $9,000 and $30,000 a year from midlevel jobs and live in China's second- and third-tier cities, where lower living expenses let them splurge occasionally on luxury goods.
"Entry-level luxury is huge in China right now, both for personal use and gift-giving," said Ms. Shou.
A major challenge for PR execs such as Ms. Shou is use of digital media."Who leads digital now. … the client's creative agency, media agency, digital agency or PR agency?" said Ms. Shou, suggesting PR firms have the strongest background to drive online interaction.