China: Ordinary citizens struggle to find rice, while luxury goods companies offer distributions and gifts to VIP customers

What Ms. Zhang did not expect when she was locked in her house under him lockdown imposed on Shanghai was that just the next day they would start arriving ready meals and sweets as gifts from luxury companies such as Louis Vuitton and Cartier.

Ever since the lockdown started because of her COVID-19 on 1 April, closing stores and paralyzing online shopping, companies overcome difficulties in delivering gifts to “very important customers” (very important clients-VIC) like 24-year-old Zhang.

Although these are not very expensive gifts, trying to keep in touch “impressed and surprised us”said Zhang, who only wanted to give her last name.

Shanghai has experienced some of the most severe restrictive measures in the world, with residents being barred from leaving their apartments in complexes where COVID-19 cases have been found, while some buildings and entire roads have been blocked.

With supermarkets closed and difficulties in the logistics chains, residents of China’s financial capital are struggling to buy food. Government procurement aimed at filling gaps has been sporadically distributed, with reports of different product qualities from region to region.

In an effort to help, many companies have distributed supplies to their employees. For the richer, banks and expensive hotels have followed the example of luxury companies and send gifts – a privilege that has not gone unnoticed by social media users.

«During the epidemic, the division of classes is more apparent. “Ordinary citizens are struggling to find rice while well-known luxury goods companies are rushing to offer first-class distributions to VIP customers,” wrote a Weibo user.

In addition to gifts, some companies offer online courses. La Mer teaches how to massage the face on their own while Dior offered a seven-day pass for online lessons in luxury yoga studios. Prada has launched an online cultural club, inviting writers, directors and musicians to suggest books, movies and albums. Prada SpA declined to give further details when asked by Reuters, simply stating that the initiative has been well received.

Emotional bond

Up to 12% of luxury retail stores in physical stores in China take place in Shanghaiso the closure of points of sale made it necessary to turn to the online, albeit personalized, VIP service, said Thomas Piaso, head of strategy at Shanghai-based consulting firm Re-Hub.

Consumers in this market segment are more likely to escape the financial impact of lockdown and appear more willing to spend money., said Piassos. “Such VIP clients are the ones that companies really know on a more personal level. “Companies know how to adapt their communication and talk to them,” he said.

Luxury does not just mean selling products, it also means selling an emotional connectionsaid Lily Lou, a senior executive at marketing company Gusto Luxe. “There is a bond that goes beyond the product,” Lou said. “Even during the most difficult times, even though the customer can not buy things from the company (at the moment) this relationship needs to be maintained and cultivated.”

VICs come with annual costs of hundreds of thousands of yuan (about $ 15,000) for some companies, although the minimum varies. Some salespeople may attribute this status to people who think they will spend more money in the future..

Although Shanghai VICs cannot spend money in stores at this time, companies try to ensure that they do so as soon as the lockdown is lifted.

«We received almost 10 birthday cakes and flowers from different companiesSaid Zhang, referring to her mother, who is also a VIC. “I’m sure that after the lockdown, there will be purchases.”