Shanghai Tang

Topics: Richemont, Luxury good, Income elasticity of demand Pages: 6 (2147 words) Published: July 26, 2013
MGT 302 - Strategic Management Shanghai Tang Case Study
MGT 302 - Strategic Management Shanghai Tang Case Study
2013
TRAN Ngoc Phung (Fiona)-00026680T
Lecture name: Mo Kader
5/12/2013
2013
TRAN Ngoc Phung (Fiona)-00026680T
Lecture name: Mo Kader
5/12/2013

Shanghai Tang Case Study

Shanghai Tang offers a unique women and men's fashion. Discover a new elegance, from clothing to accessories and home decoration. It was founded in 1994 by Hong Kong businessman David Tang. The brand’s global expansion and positioning as the first Chinese luxury lifestyle brand. David Tang has over 17 years’ experience in the luxury goods sector. He was graduated at l’Ecole Supérieure de Commerce de Nantes Atlantique, France. As a lifestyle concept, it was extremely daring and colourful. According to Luxury insider (2011), David envisioned Shanghai Tang to be the place that tourists would flock to whenever they come to Hong Kong, but it would not work as a brand globally. Moreover, it had to inject an element of wearability and modernity into their collections. According to eTeacherChinese (2013), the Shanghai Tang specialized in distinctive Chinese style clothes to satisfy the eager of seeking a cultural identity before Hong Kong’s return to China, and thus found its instant success. After 1995, branches were opened in New York, London and the larger Asian cities. In places outside of Hong Kong, Shanghai Tang was viewed as an exotic shopping destination for authentic Chinese styles. In 1999, Shanghai Tang had to close its 1,000 square meter New York store and move to a place half the size. This fashion critic claimed the Chinese style has competitive edge to western style due to their distinctive design but it needs to adapt to customer lifestyle trends in order to be successful. In addition, the positioning of Shanghai Tang is a ready to wear brand luxury, glamorous and Chinese. Moreover, the brand has been established in Hong Kong by David Tang and he has a very smart strategy by named his business Shanghai Tang because the name of the city gave an image of luxury in the minds of Chinese customers and they can also identify their country not a French or Italian. While, luxury cities are concerned, Paris is for France that Shanghai is for China (Olivier 2013). Their production use old China materials with carefully picked fabrics and natural tissues. Moreover, silk clothes are the most popular selling clothes in Shanghai Tang fashion. The colours are also sensual and dynamic. Almost of the clothes in Shanghai Tang was describe the lights of Shanghai, Beijing history and the luxury of emerging cities, and also the beautiful mix of cloths which succeed to lead Shanghai Tang among the largest brands in the luxury market. In first few year (from 1994), David Tang flamboyant, cross-cultural style and ties to celebrities fuelled the buzz surrounding the brand.

However, the brand was unable to establish it is core customer outside, and it is home market of Hong Kong and the company struggled to find a niche among successful, established global luxury brand. Under new leadership and revised creative direction, Shanghai Tang expanded into several regional markets worldwide and it is focus in Asia (Park & Yim 2007). Shanghai Tang was operated store around the world, such as, Asia, America, Europe and Middle East. However, most of the store was opened in Asia, because most of the cloths in Shanghai Tang were designed for Chinese customer. Therefore, David Tang should establish a new pathway of fashion that suitable for everyone. According to Dan (2006), David Tang say’s that the Madison Avenue’s store’s (Midtown East- New York) is up 50% in 2005 and it grew 40% last year, mostly in Asia, home to 70% of its stores. Moreover, David Tang has planned to roll out additional United Stated shops. The business tries to expand into a global business in international and the global supply chain to luxury goods for the customer. The cloths...

References: Dan. 2006. The Intriguing rise of Shanghai Tang, Available: http://www.danieldrezner.com/archives/002573.html (accessed 1 May 2013)
eTeacherChinese
MGT 302. 2013, Strategic Management Study Guide, Section 8 – International Strategy, p. 76
Olivier
Park, M & Yim, B. 2007. Shanghai Tang: The First Global Chinese Luxury Brand, Available: http://hbr.org/product/shanghai-tang-the-first-global-chinese-luxury-bran/an/HKU650-PDF-ENG (accessed 1 May 2013)
Pittilla, J
StudyMode. 2011. Shanghai Tang: the First Global Chinese Luxury Brand, Available: http://www.studymode.com/essays/Shanghai-Tang-The-First-Global-Chinese-579959.html (accessed 1 May 2013)
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