Pingti items are available online, and consumers can find items closest to branded products.
Consumers in China have access to closet replicas of the world’s popular fashion brands, like Lululemon Athletica Inc.’s yoga tights to Hermès International SCA’s handbags at a significantly low price.
The label-loving Chinese shoppers are giving backlash against these brands getting popular. But they are not cheap knockoffs; these local brands sell at relatively higher prices, promising the same quality- but without logos.
Since last year, sales have increased drastically since Chinese consumers searched for better-value products amid weakening economic confidence. Data from analytics firm Hangzhou Zhiyi Technology Co. shows that in the 12 months ending in July, some of the top local brands that are selling cheap alternatives saw double to triple growth on Taobao and Tmall, the two major e-commerce platforms in China owned by Alibaba Group Holding Ltd. The research also shows that the foreign brands whose products they imitated saw slower growth or declines on the platform. The rise of pingti pushes consumers to seek products directly sold by manufacturers, bypassing the middlemen.
According to Blair Zhang, a senior luxury and fashion analyst with Mintel in Shanghai, Chinese consumers no longer see luxury items as symbols of prestige. There is no more blind trust in well-known brands, only more rational shopping decisions.
The highest impact of pingti is on the luxury sector since they are of similar quality but without logos, which deflects the exclusivity these high-end brands had that made them desirable.
Stock Analyst Ding Xiaoying stopped spending thousands of dollars on designer clothes after the China market downturn cut her annual bonuses in half. She says she purchased a pingti version of Victoria’s Secret based on pieces from Ralph Lauren Co. and Kering SA Bottega Veneta.
Although local brands have been selling less expensive options for decades, they were discouraged by middle-class shoppers who spent dollars on labels for status symbols. Pingti entered the market during the COVID lockdown since consumers were to stay home and shop online, giving rise to direct-to-customer platforms through social media and livestreaming shows.
Pingti items are available online, and people can find items closest to branded products. Even vloggers with millions of followers are bragging about price difference and quality. Shoppers can usually place orders directly from the chat box and receive their orders in a few days.
Private brands made up to one-third of Sitoy sales of HK$841 million ($108 million) during the last six months that ended last December. Sitoy is one of the most prominent dupe merchants.
According to financial statistics, Sitoy started as a manufacturer for outside clients, but its orders slowed down due to economic and geopolitical uncertainty. They are investing in dupes to stop the decline, converting a four-story building at its factory in the southern city of Dongguan into an e-commerce center for its label — complete with live streaming studios, retail stores, and showrooms.
Making products for global brands isn’t something to brag about, a woman says in a sales video posted on Douyin. So they decided to lead the way, employing the same material and craftsmanship as luxury brands to make their brand.
People making cheap knockoffs dominate the pingti channels. It is difficult for the customers to know what they are buying since the factories and retailers can advertise their products however they want. There is less regulation in e-commerce and social platforms for sellers falsely claiming to manufacture popular brands.
That’s not stopping 45-year-old financial programmer Jessica Wang. She recently spent 3,700 yuan on a WeChat seller for a Hermès Lindy purse, which costs thousands of dollars.
She states that it was beyond her expectations. The leather was soft, stitching was delicate. She is going to buy other bags from the same shop.