Harrods' first private club in Shanghai

Over the years, the term "luxury" has become an encompassing umbrella with multiple meanings, objects, and experiences. In the specific context of the retail sector, it's no longer just about selling the latest products to wealthy customers, but rather about connecting communities through shared interests and offering unique experiences. This is the vision of the British retail magnate Harrods, which is launching its first private members' club by the end of the year in Shanghai, China, with plans for further global openings. The club, located at Cha House, a municipally protected building spanning over 5,620 square meters in the Jing'an District, also aligns with Harrods' broader intention to compete with the luxury brands in providing in-store experiences. Brands like Louis Vuitton, Prada, Fendi, and Dior have recently introduced cafes and immersive experiences at Harrods, using hospitality as a new entry point to engage consumers, as stated by Ashley Saxton, the director of restaurants and kitchens.

The club, according to Managing Director Michael Ward, "is being created to serve a curated community of discerning members." Harrods aims not only to offer international cuisine, liquors, lifestyle, and concierge services to the regional audience but also to create "a network of like-minded individuals," providing them with a space to enjoy experiences together. The new club boasts private dining rooms, a bar, lounge, and outdoor terrace, offering members the opportunity to enjoy the culinary expertise of British chef Gordon Ramsay in Shanghai, along with some of the world's most sought-after liquors like Macallan whisky and Louis XIII cognac. Members will also have access to high-end services in aviation, real estate, interior design, personal shopping, as well as private events and masterclasses hosted by brand partners. The club will have three membership tiers, with annual fees ranging from RMB 150,000 to RMB 250,000, and a total of 250 members will be accepted at the time of launch.

The launch comes at a time when luxury retailers are seeking ways to differentiate themselves. Many established players have lost their competitive edge during the COVID-19 pandemic or are struggling to generate profits due to rising costs, leading some to close their doors. The introduction of new membership incentives aims to enhance the overall customer experience. Recently, Selfridges unveiled its new membership scheme, Selfridges Unlocked, offering members access to masterclasses with prominent figures in the beauty industry, film releases, supper clubs, and other unique curated experiences. Similarly, Farfetch-owned Browns has The Club, a tier-based membership program based on annual spending or by invitation, providing exclusive access to events, products, and personal shopping services. For Harrods, the need to create new exclusive experiences for its customers arises from the necessity to remain competitive, as well as the apparent need to strengthen its foothold in the post-pandemic Chinese market. In 2019, Chinese consumers accounted for 23% of Harrods' business, a figure that declined to 16% in 2022. However, the recent easing of strict COVID-19 measures in China resulted in a 17% increase in Chinese customers at the Knightsbridge store within the last month alone, compared to the previous month.

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