Luxury’s Lunar New Year Gamble: Beyond the Horse to Win Back China
Luxury brands are placing significant bets on the Lunar New Year, hoping to reignite growth in the crucial Chinese market. As the Year of the Horse begins on February 17th, companies from Harry Winston to Loewe are unveiling exclusive collections aimed at attracting high-net-worth Chinese consumers, a demographic that has cooled in recent years.
A Market in Transition
The Chinese luxury market, valued at approximately 350 billion RMB (around $50 billion) in 2024, contracted by an estimated 3% to 5% in 2025. But, analysts at Bain & Company noted signs of recovery in the latter half of 2025, fueled by improved stock market performance and increased consumer confidence. Bernstein senior analyst Luca Solca predicts stabilization, forecasting mid-single-digit percentage growth in 2026.
Despite this cautious optimism, the landscape has dramatically shifted. Chinese consumers, once the primary engine of global luxury growth, now account for around 23% of the global market – down from one-third before the COVID-19 pandemic.
The Evolution of Lunar New Year Campaigns
Lunar New Year collections emerged in the early 2010s as Western brands sought to tap into China’s rapidly growing luxury consumer base. Initially, the focus was on offering designer goods to newly wealthy Chinese consumers, particularly those traveling abroad. Now, with greater access and more choice within China, brands must function harder to attract and retain clients.
This year, brands are responding with a range of offerings. Harry Winston unveiled a limited-edition rose gold watch priced at $81,500, featuring diamond bezels and a red lacquer horse motif. Chloé released a capsule collection, including silk scarves starting at $250 and a snakeskin and leather shoulder bag priced at $5,300, incorporating horse-themed details. Loewe, Gucci, and Loro Piana have introduced horse-motif bag charms.
Beyond Literal Interpretations: The Need for Cultural Nuance
Experts warn that simply incorporating zodiac animals isn’t enough to impress discerning Chinese consumers. “The Chinese are no longer in awe of anything that comes from the West,” says Luca Solca. “A perfunctory interpretation of CNY is not going to go far.”
Veronique Yang, who leads BCG’s consumer practice in Greater China, emphasizes the importance of modern reinterpretations of traditional culture. Younger shoppers seek fresh perspectives and narratives that connect heritage with contemporary vision. The zodiac animal is considered a lucky symbol only for those born in that year, making excessive horse imagery potentially risky.
Brands are increasingly focusing on immersive experiences and cultural engagement. Valentino hosted a three-day lantern festival in Shanghai, while Burberry launched an extensive Lunar New Year campaign with Chinese brand ambassadors and a pop-up boutique in Beijing.
The Impact of Domestic Spending and Sophistication
The pandemic significantly altered Chinese luxury spending habits. Before 2020, two-thirds of purchases were made abroad. By 2025, that figure had fallen to one-third, as travel restrictions boosted domestic spending.
Chinese high-income consumers have also develop into more sophisticated. Having experienced the best the world has to offer, their expectations for brands are significantly higher. They’ve grown accustomed to domestic high-end labels and demand more than just a logo or a seasonal motif.
Loewe’s approach – adorning its signature Puzzle bags with fringes and tassels for a cowboy aesthetic – is cited as a preferred example of a less literal, more creative interpretation of the Year of the Horse.
Looking Ahead: Strategic Activations and Long-Term Equity
Lunar New Year activations are evolving into strategic engagements aimed at building long-term brand equity across Asia. The holiday presents a key opportunity for Western brands to demonstrate respect for Chinese culture, but success requires a deeper understanding of evolving consumer preferences and a commitment to authentic cultural connection.
FAQ
Q: Is the Lunar New Year still crucial for luxury brands?
A: Yes, it remains a crucial opportunity to reconnect with Chinese consumers and potentially reignite growth in the market.
Q: What are Chinese consumers looking for from luxury brands?
A: They want more than just logos and seasonal motifs. They seek authentic cultural connections, modern reinterpretations of tradition, and immersive experiences.
Q: Has the Chinese luxury market recovered?
A: The market is showing signs of recovery after a contraction in 2025, but it’s still more competitive than it was before the pandemic.
Q: What is the current value of the Chinese luxury market?
A: Approximately 350 billion RMB (around $50 billion) as of 2024.
Did you know? Before the COVID-19 pandemic, Chinese consumers accounted for about one-third of the global luxury goods market.
Pro Tip: Brands should focus on creating narratives that resonate with Chinese culture and values, rather than simply relying on zodiac animal motifs.
What strategies do you think luxury brands should prioritize to succeed in the Chinese market? Share your thoughts in the comments below!
