Chinese consumers are becoming increasingly sophisticated and brand-savvy, underpinning a fast growing market for luxury products, according to an Italian luxury material manufacturer.
"The Chinese consumer market is promising, not only because of its volume, but also that local consumers are very reactive, enthusiastic of new things and sensitive to brands and quality," said Andrea Boragno, CEO and chairman of Alcantara, which makes a leather substitute used in fashion and accessories, automotive interiors and consumer electronics.
The company opened its second international store in Shanghai in April following a concept store in Milan where the company's headquarter is based.
China is one of the two fastest growing markets for Alcantara and the second largest market following the European Union in terms of sales last year, according to Boragno.
In his eyes, Chinese designers have made strides in recent years by shifting from copying to developing their own identity based on their creativity and culture. The company is already working with Chinese designers to promote their brand.
The company will stick to "Made in Italy" to maintain exclusive quality while planning to work with Chinese brands in the future, he added.
Boragno attributed Alcantara's popularity in China to Chinese consumers' willingness to pay for exclusivity as well as the recognition of a green lifestyle.
The carbon-neutral-certified material producer has been managing to reduce and offset its greenhouse gas emissions to zero since 2009 through advanced and efficient production processes and participation in global sustainable initiatives.
Last year, Alcantara invested 22 million euros, of which more than seven million was devoted sustainability-related activities. It plans to invest 28 million euros this year, with over 25 percent of spending on health, safety and environmental activities, according to the company's annual report.
"Going green will not hurt profits in the long run. Instead, we strongly believe that the generation of value for stakeholders can become a driver to generate value for shareholders," Boragno said.
Alcantara organized an exhibition using sustainability as the theme in Italy this week to echo the G7 Environment Ministers Meeting, which includes works from Chinese calligrapher Qin Feng using the company's material.
Sustainability is a necessary factor that will help materialize the long-term objective of increasing the company's financial value, Boragno added.