Shhh ... Luxury Goods Are Discounted in China

Luxury goods makers have long valued Chinese consumers not just because of their huge appetite for Gucci bags and Cartier watches—consultancy Bain estimates that Chinese purchased a third of all luxury goods sold globally in 2013—but also for their willingness to pay more than their Western counterparts. So it wasn’t business as usual in July when a pair of light brown Salvatore Ferragamo Carla leather pumps was being sold at 40 percent off, for 3,120 yuan ($507) on a site run by e-retailer Xiu.com, which is less than the item’s European retail price. Likewise, at a downtown Shanghai outlet of Kering’s Gucci, a light pink Soho leather shoulder bag was discounted 30 percent to slightly more than 12,000 yuan, about the same price as a similar bag in the U.S.