Luca de Meo, CEO of luxury group Kering, said the company faces significant challenges and increasing competition within the Chinese market [1].
This admission highlights the volatility of the luxury sector in Asia, where consumer behavior and local competition are shifting. Because Kering owns high-profile brands like Gucci, any instability in China directly impacts the group's global revenue and growth projections.
De Meo addressed the situation during a discussion on July 29, 2026 [1]. He said the company must adjust its strategy to remain viable in the region. The luxury landscape in China has evolved, making it difficult for European houses to maintain their previous dominance.
"On China...there is a lot of work that has to be done," de Meo said [1].
He said the company must acknowledge the current state of the region's economy and retail environment. The CEO said there is a need for humility and strategic pivoting to address the headwinds facing the group, a necessity for long-term sustainability in the East.
"We have to respect that this is becoming one of the most challenging and competitive markets in the world," de Meo said [1].
Kering has not yet detailed the specific operational changes it intends to implement to counter these challenges. However, the acknowledgment of the market's difficulty suggests that previous growth strategies may no longer be effective in the current climate [1].
“"On China...there is a lot of work that has to be done."”
Kering's admission reflects a broader trend of luxury conglomerates struggling to adapt to a maturing Chinese market. As local brands gain prestige and consumer spending patterns shift away from traditional status symbols, European luxury houses must pivot from aggressive expansion to more nuanced, localized strategies to avoid losing market share.
