HERMES launches a new brand

For the first time in its history, the HERMES Group launches a new brand with a dedicated line of products. The new brand called SHANG XIA will be launched in China and will have its own identity with products made from materials and design rooted in the Chinese traditions.

The move comes as a strategy of HERMES to take advantage of the Chinese luxury market boom in 2010 therefore proposing a new brand with lower priced products. At the same time, many analysts point out that Hermes’s strategy also comes as an effort to recuperate its slower development on the Chinese market.The brand will also be distributed in Paris in one of the large department store.

This move seems to have all its business strategic motivations, yet HERMES risks its brand reputation as the new brand will surely cross into other markets. It will be practically impossible for the new brand not to be associated with Hermes, many clients will most likely consider it the ”cheaper” line of the reputed French brand.