The "Global Store King" Competition

Author | Wang Xiaojun, Zhou Zhiyu

Editor | Zhang Xiaoling

In the past decade, the crown of global luxury retail sales has belonged to China. And the jewel on the crown is Beijing SKP. It has repeatedly won the title of "Global Store King," with annual sales exceeding 20 billion.

However, in 2024, Nanjing Deji took the crown of "Global Store King." Now, with the rise of a new Chinese brand—LAOPU GOLD, SKP vows to reclaim its lost throne.

Recently, LAOPU GOLD officially opened its independent store on the first floor of Beijing SKP, marking its third store in Beijing SKP. Similar to Hermès and CHANEL, it breaks the long-standing monopoly of international luxury brands on the first-floor gold position.

An investment institution representative told Wall Street Insight that LAOPU GOLD's sales at SKP last year were about 2 billion, and this year, with the new store, it is estimated to reach 3-4 billion, which will be a key option for SKP in the competition for the store king.

The well-known high-end shopping mall Beijing SKP is trying to regain its "store king" position by heavily betting on LAOPU GOLD. However, the "store king" competition is not just about sales; it has taken on new connotations. It is no longer a race to sign more international big brands or a competition for high-end mall leasing, but rather a profound insight into the changing psychology of Chinese consumers.

The global luxury goods market is accelerating into a new era. The emergence of LAOPU GOLD is less of an antidote for SKP and more of a new exam paper handed to all high-end malls, and the real test has just begun.

The Lost Throne

For many years, SKP, located on Dawang Road in Beijing, has steadfastly held the title of store king in China and even globally.

However, in 2024, Beijing SKP faced a Waterloo, with annual sales of 22 billion, a year-on-year decline of 17%. Meanwhile, another luxury mall, Deji Plaza, located by the Qinhuai River in Nanjing, surpassed Beijing SKP with a sales figure of 24.5 billion, becoming the new "store king."

Behind this is the fierce turbulence in the global luxury goods market. According to a report by Bain & Company, the global luxury goods market lost about 50 million customers in 2024, with over 70% of consumers conducting cross-platform price comparisons before purchasing luxury goods. In mainland China, personal luxury goods market sales declined by about 18%-20%.

The collective winter of international luxury brands is directly reflected in the financial reports of luxury goods groups.

In the first half of 2025, LVMH Group's total revenue fell by 4% year-on-year to 39.81 billion euros, and net profit dropped by 22% to 5.69 billion euros. Kering Group's operating income was 7.587 billion euros, a year-on-year decrease of 16%; net profit was 474 million euros, a year-on-year decline of 46%, with GUCCI's revenue dropping by 26% year-on-year to 3.027 billion euros.

Such turbulence also reflects changes in luxury consumption trends.

Industry insiders analyze that luxury consumption is showing a polarized trend. The shrinking middle class is actively withdrawing from the luxury shopping army, turning to more stable consumption like gold, shifting from experiential to functional, while the ultra-wealthy continue to demonstrate astonishing purchasing power, consistently embracing first-line brands. However, this segment of the population is not large, leading to the luxury goods industry being affected by cyclical influences At the same time, the consumption landscape for luxury goods is also changing. Taking Nanjing's Deji Plaza as an example, it has validated the victory of diversified experiences and social spaces. In 2024, Deji's sales soared to 24.5 billion yuan, averaging over 66.93 million yuan per day, with approximately 2.79 million yuan sold per hour.

Success is not accidental; Deji has broken the dull retail model of traditional high-end shopping malls and built an ecosystem for high-end consumption, pursuing diversity rather than solely relying on international brands.

Here, the Deji Art Museum regularly hosts exhibitions. Third-party data shows that the conversion rate of exhibition visitors to high-end consumers reaches 38%; a themed restroom, costing tens of millions to create, attracts over 5,000 visitors daily, boosting surrounding store sales by 20%.

On the other hand, this is also a result of targeting different consumer demographics. Deji Plaza has precisely aimed at the Generation Z consumer group. Public data shows that the population proportion of China's Generation Z is about 20%, but their consumption scale accounts for 40% of China's overall consumption.

In addition to a range of luxury brands, Deji has introduced fashion brands such as CHUU, NERDY, ERDOS, and UNDEFEATED, along with over 60 dining establishments, covering everything from high-end dining to cost-effective small shops.

These initiatives have increased foot traffic and vibrancy in this high-end mall. For many consumers, although luxury goods costing tens of thousands or hundreds of thousands may be hard to afford, spending a thousand yuan on a fine dining experience is still a consideration.

Thus, under multiple factors, Deji Plaza successfully "ascended to the throne" last year.

Heavy Bet on LAOPU GOLD

Under competitive pressure, SKP must make changes.

Beijing SKP was initially named Xinguang Tiandi, holding a transcendent position and a cool temperament in the domestic luxury goods market. It was once rumored in the industry that "if a new product can't be found at SKP, it doesn't exist nationwide," highlighting its prestige.

However, relying solely on traditional international brands is no longer sufficient to support SKP's facade. A few years ago, this mall chose to allow a gold jewelry brand to enter, which became a disruptive force in the market.

This year, waves of consumers have flocked to SKP, not to purchase a bag from a well-known luxury brand, but to crowd into LAOPU GOLD to acquire some desired gold jewelry. At the peak of the queues, some joked, "Old money has turned the top luxury mall into a vegetable market."

This is reflected in the financial reports, where LAOPU GOLD is thriving. In the first half of 2025, LAOPU GOLD achieved total revenue of 12.35 billion yuan, a year-on-year increase of 251%, and a net profit attributable to the parent company of 2.27 billion yuan, a year-on-year increase of 286%.

Although in terms of scale, LAOPU GOLD's revenue is not on the same level as the aforementioned luxury groups, the ebb and flow can still provide insights into consumer movement.

According to research data from Frost & Sullivan, the average overlap rate of LAOPU GOLD consumers with those of the five major international luxury brands, including Louis Vuitton, Hermès, Cartier, and Bulgari, is close to 80%.

According to the financial report, as of June 30, LAOPU GOLD has settled in 29 leading commercial centers and has 41 stores. In the first half of this year, LAOPU GOLD achieved an average sales performance of 459 million yuan per single mall, significantly surpassing both domestic and international jewelry brands, and has already outperformed some leading international luxury giants According to third-party data, in the first half of this year, LAOPU GOLD achieved nearly 220% performance growth at Beijing SKP. Amid the continuous decline of international luxury brands, it single-handedly contributed to a sales increase of approximately 20% at Beijing SKP.

Compared to last year's sales, the differences among top luxury malls such as Beijing SKP, Nanjing Deji Plaza, and Shanghai IFC are not significant.

In other words, for Beijing SKP, LAOPU GOLD, which does not lack consumers, opening another store and operating at full capacity for a year is expected to help it regain the position of "store king."

LAOPU GOLD has become a key bargaining chip in the competition among high-end malls. There are even rumors in the industry that "whoever becomes the 'store king' will be decided by LAOPU."

Xu Bing (pseudonym), who has been engaged in commercial real estate leasing in Wuxi for decades, is a regular at Deji. Every time he visits Nanjing, he goes to Deji, partly to shop and browse luxury stores that Wuxi Hang Lung does not have, and partly to learn about Deji's operational strategies.

In his view, Deji gathers the high-quality purchasing power of Jiangsu and Anhui provinces, while Beijing SKP and Shanghai IFC, although they occupy high-quality customer sources in first-tier cities, have countless commercial entities. Even among luxury malls, there are many choices. However, in Nanjing's Deji, the competitors are limited, making it almost a monopoly.

In the long term, he believes that Deji is not static or stagnant. "LAOPU GOLD is in an expansion phase, and since there will be queues anyway, there is no worry about foot traffic. Since it can open another store at Beijing SKP, why can't it open another one at Deji?"

Another commercial real estate professional working in Shenzhen, Harry, stated, "I started observing LAOPU GOLD's business logic when the first store opened in Shenzhen. Its business model is different from traditional gold jewelry brands, pursuing uniqueness in products, craftsmanship, and marketing, so its rapid growth is not surprising."

However, he also pointed out that the gold category has its limitations; relying solely on gold to support the revenue of a high-end mall is far from sufficient. "Currently, it still mainly relies on traditional international luxury brands. In the future, it will depend on whether LAOPU GOLD can become a global top luxury brand."

Regardless, LAOPU GOLD has already become a decisive factor in the competition for market share among high-end malls. Whoever secures LAOPU is likely to rise to the top.

Of course, for the entire luxury mall sector, it is still necessary to layout a diverse range of luxury brands while strengthening social and experiential aspects to continue expanding market share.

Changing Landscape

LAOPU GOLD's entry into the first floor of Beijing SKP has become a key factor in the competition among high-end malls, signifying a structural shift from nearly 30 years of complete reliance on international luxury brands to the introduction of strong Chinese brands.

Next month, with the opening of Shanghai Hongqiao Hang Lung store, LAOPU GOLD will also become the only Chinese brand to achieve full coverage of top luxury malls.

In the revenue composition of top luxury malls, about 90% of revenue comes from the top 30% of brands. Previously, the core competition of these malls was primarily centered around international top luxury brands.

However, with the rapid development of the Chinese economy and the shift in consumer spending from material to spiritual and experiential aspects, high-end malls are also changing their deep reliance on international big brands, with LAOPU GOLD being the most typical example Xu Bing stated to Wall Street News that, generally speaking, due to considerations such as costs and renovation cycle losses, about 70% of stores in shopping malls do not change each year. These brands form a stable foundation for the mall, while the remaining 30% may be replaced through elimination or the introduction of new stores.

When it comes to replacements, high-end malls are increasingly focusing on first-store economics and exclusive collaborations, as well as domestic influencer brands that can drive traffic. Brands like LAOPU GOLD, which have high traffic and sales, are key targets for high-end mall leasing.

Xu Bing mentioned that he and his colleagues also pay attention to the opening trends of emerging influencer brands and the development status of domestic brands.

Xu Bing emphasized, "Referring to influencer brands is not derogatory; it is an insight into consumer trends." Although the mall he is in has not been able to introduce LAOPU GOLD, other influencer brands brought in have also contributed significantly to foot traffic.

Harry further pointed out that cultural confidence is boosting domestic brand consumption, with many domestic brands drawing inspiration from traditional culture to create their unique symbols and logos. Harry cited that, besides LAOPU GOLD, he is also optimistic about Songmont.

However, he also believes that from the perspective of commercial project profitability, these brands are still not fully mature compared to traditional luxury and even light luxury brands, and further observation is needed.

From the SKP queue frenzy to the social carnival on Xiaohongshu, gold consumption has been endowed with multiple meanings of investment, cultural identity, and emotional value. The Chinese people's preference for the value-preserving properties of gold and the return of cultural identity have made LAOPU GOLD a unique case in the declining era of luxury goods, making it a coveted target for high-end malls.

The sustainability of this cultural consumption also requires the rise of more local brands to support it. The landscape of the global luxury goods market may also be significantly rewritten.

In this sense, the competition for SKP's title of "Global Store King" will never cease