The fact: growth is back in the forecasts
Roland Berger expects China’s luxury market to grow between 3% and 6% in 2026, then hold a steadier 5% to 7% a year over the five years after that. Jing Daily published the forecast on 13 February 2026, together with a consumer survey finding that more than a third of Chinese luxury shoppers say they plan to increase their spending.
That forecast sits on top of a very bad year. According to 报告大厅 (China Report Hall), domestic luxury sales in China fell 17% in 2024, to 512.7 billion RMB. Offline sales dropped 25%. Online dropped only 5%. Online now carries 46% of the volume.
China’s share of the global luxury market went from roughly 22% to 18% in a single year.
Roland Berger’s survey also says which buying reasons came back first, and the order matters: quality and brand reputation, then self-expression and status. Brands have been moving accordingly. OMEGA, TUDOR, Vivienne Westwood and MIKIMOTO have all opened Tmall flagships recently.
The decryptage: recovery is not the same thing as return
“The market is recovering” is the least useful sentence your team can act on. It tells you nothing about where the money lands.
Here is the part I would want you to hold on to. In 2024, Chinese luxury spending did not evaporate. It relocated. Bain & Company, in its 2024 China luxury report published on 21 January 2025, put total global luxury spending by Chinese consumers down 7% for the year, while the domestic market fell 18% to 20%. Overseas purchases accounted for around 40% of everything Chinese consumers bought. Asia-Pacific destinations ran at about 120% of their 2019 levels.
The gap between those two numbers, 7% and roughly 18%, is your outflow. It is not a consumer who stopped caring about luxury. It is a consumer who bought the same bag in Tokyo.
And the grey market grew through the downturn. Bain estimates daigou revenue rose about 5% in 2024, with discounts on daigou platforms deepening by roughly 8 percentage points year on year. In fashion and leather goods, daigou volume runs anywhere from 15% to 25% of official mainland sales, and for some brands well past 60%. Hainan duty free, meanwhile, fell around 29%.
So the 2026 question is not whether Chinese consumers will spend on luxury again. They never really stopped. The question is whether they will spend domestically, with you, at full price. Those are three separate conditions, and a brand can lose on any one of them while the market chart goes up.
There is a precedent worth remembering, and it is not flattering to forecasters. After 2022, plenty of respectable firms called a sharp rebound for 2023 and 2024. It did not arrive in the shape they described. Forecasts on this market have a poor recent record, and a 3% to 6% band is wide enough to cover both a decent year and a disappointing one.
What stays genuinely unclear is pricing. Bain measured a gap of up to 30% between Japan and mainland China at the weakest yen levels. Until that gap narrows, through currency, through pricing decisions, or through duty and travel-retail policy, a share of demand will keep leaving. Nobody can tell you today whether it closes in 2026.
What this means for your brand
You may have missed the quieter finding inside the recovery: the buyer changed during the downturn. She researches more before buying. She compares prices across markets on her phone, in the store, in front of your sales associate. She has less patience for marketing built on a logo and a celebrity face.
If your 2026 plan is to switch the old playbook back on, you will spend against a consumer who no longer exists in that form.
Who this affects most: brands in the accessible luxury and premium range, where price comparison is easiest and loyalty is thinnest. Watches and jewellery too, since those took the worst of the 2024 decline. Brands at the very top, with waiting lists and genuine scarcity, are less exposed. If your product cannot be found on a daigou channel at a discount, most of this does not apply to you.
The time window is roughly this year. Once growth is visible in everyone’s numbers, media costs on Xiaohongshu and Douyin rise with it, and your entry price goes up.
The cost of doing nothing is not zero revenue. It is worse than that. It is revenue that shows up in Seoul or Tokyo, credited to no one on your China team, while your mainland performance looks flat and your headquarters quietly concludes that China is not working.
A field example. A European leather goods house we worked with, mid-size, strong in France, watched mainland sales sit still for eighteen months. Their own resale and daigou tracking, once they built it, showed a meaningful share of their Chinese customers buying the same references abroad. Nothing was wrong with the demand. The domestic path to purchase was simply the least convenient one they offered.
What to do about it, in order
Start with measurement, not campaigns. Before you approve a single media budget for 2026, find out how much of your Chinese demand is currently being served outside your official mainland channels. Search your product references on Dewu, Xianyu and the daigou WeChat circles. Note the prices. That number is your real gap, and most brands have never calculated it.
Second, close the price story. You do not need identical prices worldwide, and you probably cannot have them. You do need a defensible answer when a customer shows your sales associate a Tokyo price on her phone. Service, authenticity guarantee, repairs, exclusive references, membership. Something that is worth the difference and that your staff can say out loud.
Third, rebuild the research layer. She looks you up on Xiaohongshu before she walks into the store, and increasingly she asks an AI assistant. What she finds there is written by other people, not by you. Genuine reviews, real product detail, and answers to the questions she is actually asking do more for conversion right now than another brand film.
Fourth, make the domestic purchase the easy one. That means a working Tmall or JD presence, a WeChat mini-program that does not fight the customer, and stock availability that matches what your campaigns promise. The 46% online share is not a channel preference. It is where the purchase decision now happens.
What your team can do in house: the price positioning work, the retail script, the product content. Those need brand judgment and nobody outside knows your house better.
What usually needs help: the platform mechanics and the daily content operation in Chinese. If you want that handled by people already inside the platforms, this is what our China e-commerce team does, and the wider full-service luxury offer in Shanghai covers the retail and content side alongside it.
Do the measurement first, whoever runs it. A budget approved without that number is a guess.
Over to you
Some brands are going to spend 2026 trying to bring spending home by narrowing the price gap, accepting a thinner margin on every mainland sale. Others argue that is a losing game against currency movements, and that the money spent abroad still counts as brand revenue, so the effort belongs in retail experience instead.
I genuinely do not think one side is obviously right. Which way is your brand going, and what convinced you? Tell me in the comments, I read them.