Brand Strategies for Luxury Brands in Shanghai

By Daniel Kim

Luxury stores may appear closed at first glance—but in reality, their doors are open; they are simply designed to be hard to find.

This subtle barrier can be both physical and visual. For instance, when attempting to enter a Valentino store on Huaihai Zhong Road, the entrance featured a discreet handle and a noticeably heavy door. Even after managing to open it, there was a brief moment of hesitation—uncertainty about whether I was meant to enter at all.

Across Shanghai, many boutiques adopt this approach. Storefronts feel deliberately less welcoming, often concealing products rather than displaying them to passersby. This intentional opacity reinforces the exclusivity of premium offerings. For some, the ambiguity of entry can evoke a mix of hesitation and intrigue—where slight discomfort heightens curiosity and, in turn, desire.

Access, therefore, becomes a subtle signal of belonging. Only those who recognize how to enter—or feel confident enough to do so—cross the threshold. In this way, these spaces distinguish insiders from the general flow of urban pedestrians, transforming entry itself into a marker of status and cultural fluency.

This dynamic may particularly resonate with upper-middle-class Shanghainese consumers, for whom distinction is not only about wealth, but also about differentiating themselves through refined taste, cultural awareness, and the ability to navigate subtle social cues within an increasingly diverse urban environment.

In contrast to other luxury brands with exclusive storefronts, the Korean premium eyewear brand, Gentle Monster, draws the largest crowds on Huaihai Zhong Road through its striking art installations. The store was filled with visitors, many of whom queued to take photos in front of uncanny, gigantic sculptural faces. While such large-scale installations may compromise short-term in-store ROI, they create an immersive and highly shareable environment—significantly boosting brand visibility through continuous foot traffic and social media engagement.

Directly across the street, the Chinese bag brand, Songmont, adopts a markedly different strategy. By deliberately limiting the number of visitors allowed inside, the brand creates visible queues. As part of a new wave of Chinese consumer brands, Songmont emphasizes Chinese aesthetic heritage as a compelling alternative to Western luxury. The controlled in-store environment allows for more intimate, staff-assisted interactions, deepening engagement for those inside while simultaneously cultivating curiosity and desire among those waiting outside or peering in.

We are curious which strategy will resonate more with Chinese consumers.

For discovery and mass desirability: Gentle Monster likely has the edge. It scales attention quickly and thrives in a social-media-first ecosystem.

For depth and brand loyalty: Songmont’s model may prove more durable. It converts interest into emotional attachment and perceived value.

 

Why Gen Z is Enthusiastic about Little Cute Things

By Tracy Shim

For Gen Z, the growing obsession with cute and harmless things such as character IPs, miniature merchandise, and emojis goes beyond personal taste. It signals a deeper emotional reality for many Gen Zs, who face anxiety fueled by unstable job prospects, emotionally draining relationships, constant social competition, and a sense of losing control over the future.

In this environment, soft and gentle visuals help people feel safe and relaxed. For many young people, such visuals provide a moment of emotional relief from the stress and pressure of everyday life.

Psychology also helps explain this trend. In Japan, the concept of “kawaii (かわいい),” or cuteness, implies warmth, innocence, and emotional safety. A study from Hiroshima University demonstrates that viewing cute images improves focus and emotional response. This aligns with the “baby schema” theory in evolutionary psychology. For instance, features like big eyes and round faces activate our instinct to nurture and create emotional bonds.

These psychological responses help explain why certain characters resonate so deeply with young people today. Many are drawn to intentionally imperfect character designs that reflect their own emotional state.

Image from Instagram @yurang_official

In Korea, characters like “Broken Bear” (Manggureojin Gom) and “Small Cute Chiikawa” (Meonjakgwi) are especially loved by young people. Their uneven lines and awkward expressions may reflect the emotional state of many Gen Zs. This makes them feel imperfect but relatable. People see themselves in these characters and feel an unexpected sense of sympathy.

Some characters connect not just through visual traits but through empathy. With phrases like “It is okay not to try so hard,” characters such as “Gosim” (Choigosim) and “Doguri” comfort those young people who feel emotionally drained, and have built large online followings.

As this emotional shift grows stronger, more brands are jumping into character collaborations and seeing results. Brands like Olive Young and Mega Coffee have launched character-themed campaigns that not only sell out quickly but also drive strong customer engagement. Recent retail data supports this trend, showing double-digit growth in character items and blind box collectibles, along with increased sales and customer retention. Some brands like Samyang and LG U+ have even created their own characters, highlighting the growing recognition that character IPs can be powerful brand assets when supported by a clear strategy.

Image from Instagram @doguri_official

There is also a tangible shift in what young people carry and consume. Miniature figures, plushies, and especially character key rings are wildly popular. It is common to see high-end handbags decorated with multiple cute key chains, a visual mix of luxury and emotional softness. These are not just accessories. They are emotional anchors.

This emotional connection offers a meaningful opportunity for brands. If a brand aims to use characters in its marketing, the key is to understand Gen Z’s emotional needs and create characters with depth, authenticity, and a clear narrative. That is how lasting loyalty is built.

Luxury Consumption in Korea: Family Strategy for Status Preservation

By Daniel Kim

In Kangnam, a daughter attending a top-tier university often borrows her mother’s classic Chanel bag to show off when meeting friends. When the mother buys a Gucci shirt, she will look for a style that she and her daughter both enjoy, so they can share it.

At the heart of luxury consumption in Korea lies a family’s strong desire to elevate their social status amid growing economic inequality. In fact, Koreans have long been accustomed to competition within a rigidly hierarchical society. From a young age, they strive fiercely to gain admission to prestigious universities. After graduation, they face another round of intense competition to land high-paying jobs at top companies such as Samsung and Hyundai.

Therefore, luxury consumption in Korea is often driven more by the desire to conform to norms and expectations tied to one’s social status, rather than by a pursuit of individual style. To navigate this landscape effectively, it is essential to comprehend the hierarchical positioning of different brands within the context of ever-changing trends.

For example, a successful engineer at Samsung takes the time to study the heritage and history of luxury brands in order to offer fashion advice to his wife. Rather than shopping for himself, he would be more inclined to invest in luxury items for his wife and daughter, finding a sense of achievement in the way the family is presented to others.

Compared to foreign nations, luxury consumption in Korea serves more as a way of blending into the appropriate status group subtly, rather than standing out through expressive individuality. As a result, overt logo displays are often avoided, while understated patterns and low-key brand codes are favored. For example, the patterned lining under the sleeves of Dior jackets gained popularity because it could be discreetly folded to reveal the brand only when desired.