According to a recent story in the FT, Hong Kong is proving to be a magnet destination for the world’s top auction houses. Christie’s is moving its regional HQ to the new Henderson skyscraper this month, while Sotheby’s, Bonhams and Philips are all establishing themselves in the city. The reason, it would seem, is that to counteract the global slowdown in art sales, the auction houses are hoping to attract the ultra-high end of the Asian market who they believe are active in Hong Kong.
More than a third of buyers at Sotheby’s recent New York auctions came from Asia, which explains why it has opened a ‘maison’ in Hong Kong’s Central district to sell high-ticket rare books, paintings and sculptures.
The auction houses are following a trend identified by analysis. According to PwC, Hong Kong currently has the highest per capita spending on luxury goods and the market is expected to grow by 4.5% from 2023 to 2030.
So why does Hong Kong continue to thrive when other traditionally strong luxury markets are struggling?
One of the reasons is that Hong Kong has always attracted China’s burgeoning affluent class, whose needs are taken care of with generous tax breaks and personalised retail experiences. It is these experiences that the auction houses are now aiming to emulate.
But another factor is the willingness of Hong Kong’s luxury buyers to embrace e-commerce and social media as part of the fabric of their shopping journeys. The fact is that wealthy consumers in the city use digital channels to get what they want, and they are passing on these behaviours to the next generation.
And it doesn’t stop at retail. A survey announced this week shows that wealthy individuals in the city are willing to embrace AI-guided wealth management. Over the past two years, 93% of the 500 rich individuals surveyed, increased their use of digital channels for wealth management.
Asia has always been a standard-bearer for digital transformation, and these recent trends indicate that its most wealthy citizens are prime adopters of digital innovations. And so too are Asian consumers across the board. Digital wallet transactions in Asia-Pacific, for example, are predicted to grow more than fivefold by 2025.
When it comes to insurance – which is essential for those buyers who want to protect the value of the luxury items they are purchasing – that too needs to be digital, personalised and flexible if it is to attract Hong Kong’s savvy consumers.
A good example of this is the cover we offer for luxury watches. Our customers are reassured by the way that we match their insurance cover with the current market value of their timepiece. We also reassess the value every month, so they always pay the right premium.
Asia, and in particular, Hong Kong remain buoyant markets in a world where purchasing luxury goods has become too risky for many. What we offer is a way to manage that risk with the convenience, security and personal service that is an expectation of today’s modern buyer, whether they are purchasing a priceless piece of art, or a vintage Tag Heuer watch.
