China's richest people are leaning hard into quiet luxury, wielding stealth wealth like a weapon and scorning their flashy, label-chasing peers

• Loud luxury has gone out of style in China.
• "Laoqianfeng," as it's known in the country, is not unlike the old-money aesthetic in the West.

First, people respect the silken clothes. Then, they respect the man.

For generations, that's been the popular saying in China — 先敬罗衣后敬人. It translates to a simple lesson for everyone who wants to be wealthy, or at least look the part.

What looking rich means to the Chinese has evolved over the years, but one thing is consistent: they spare no expense. Chinese shoppers will make up 40% of all luxury consumers by 2030, despite recent turbulence, per Bain & Co's research. Fashion houses from Burberry to Dior are also doubling down on their efforts to cash in.

But the face of China's rich is changing. Gone are the flashy logos you can spot from a mile away. A world away from America, the laws of the hit HBO series "Succession" apply, too. The old-money aesthetic is in, new-money fashion is gauche, and if you want to be taken seriously, play the game.

The rules are simple. No head-to-toe Gucci. No loud colors, no all-over Louis Vuitton print. The logic is, you wouldn't wear anything that you'd see in "Crazy Rich Asians," or what the Americanized Asians are decked out in on Netflix's "Bling Empire." And, per Tom Wambsgan of "Succession," small, unassuming pouches only, because carrying a "ludicrously capacious" bag is out of the question.

Decoding 'laoqian' style

To understand style and money in China, there are three terms you need to be familiar with: laoqianfeng, xinqianfeng, and tuhao.

To start, what flavor of rich you are in China is coded into your very person, from the clothes you wear, to the way your hair and skin looks. In attempting to craft your image in the style of laoqianfeng — similar to what the West calls the old-money aesthetic — you must appear well-nourished and put-together, but natural and understated enough to look like you've done absolutely nothing to achieve effortless grace. And for xinqianfeng, or the new-money aesthetic, you leave it to your clothes to announce you've arrived at a certain level of wealth, with as much flash and glitter as possible.

The term "laoqian" in China also refers to a group of people whose wealth has stacked up over several generations. Think the scions of property moguls and political power players, the fuerdai who have been educated at Ivy League schools, who fly home for the summer to their lush homes in the inner rings of the Chinese capital, close to the core of Beijing's beating heart.

Xinqian, meanwhile, often refers to the wave of new millionaires who hustled for their wealth post-Communist Revolution. Their parents might have come from the villages or eked out a middle-class living in the country's smaller, lesser-known cities. But there's a new generation now coming into its own and raking in the yuan in bucketloads. Some of their members are flashy tech and gaming millionaires inhabiting Shanghai and Guangzhou's glitziest apartments. Others are shiny social media influencers making millions on the internet.

And then there are the tuhao, a term that loosely translates to "crass rich," local moneyed men with garish clothes, revving their red sports cars as they fly by people trundling along in modest sedan cars.

Loud luxury is out, and here's why

There are several reasons why loud luxury is fading out in China.

In a similar vein to the US and Europe – the "quiet luxury" aesthetic has emerged as a reaction to the economic climate. With the economy slowing and the country facing a 20% youth unemployment rate, it's not a good look for the rich to be splashing their wealth right now.

At the same time, the economic downturn is squeezing younger, aspirational shoppers who helped to create a boom in luxury sales in China over the last few years. These shoppers, who were flush with cash during the pandemic, became key buyers of luxury goods. And as many were making their first luxury purchases, they wanted to be loud about it so flashy logos reigned supreme.

But as their excess cash has depleted, the "logo hunters," as Tema ETF luxury portfolio manager Javier Gonzalez Lastra dubs them, are increasingly taking a back seat and leaving older, wealthier customers to drive luxury spending.

And this crowd – who are no longer luxury newbies – increasingly have a preference for less flashy logos, he said.

Stealth wealth allows the rich to toe the party line in Xi Jinping's China

Make no mistake: The surge in interest in quiet luxury doesn't just stem from a modern, Western-inspired impulse to look like old-money Americans. It's social capital, but it's also a product of a particular moment in China, a confluence of political and social factors precipitated by Chinese leader Xi Jinping's push for a "common prosperity."

China has long had an uneasy relationship with the pursuit of luxury goods and an affluent lifestyle. The government has spent over a decade discouraging ostentatious displays of affluence. Back in 2011, the authorities started banning billboards with terms such as "luxury" and "high class" in Beijing. A year later, China banned civil servants from accepting expensive gifts or using public funds to host extravagant dinners.

That extended to the government's oversight over social media. In 2021, China's version of TikTok, Douyin, said it deleted thousands of accounts and videos involving excessive displays of wealth, also known in Chinese as "xuanfu." The South China Morning Post reported that some of these videos involved users showing off exorbitant amounts of cash and luxury items like watches and the keys to flashy cars.

This push for a more austere approach to living even inspired some businesses to find new ways to stay on the straight and narrow and avoid incurring the wrath of the Chinese authorities. Chinese financial firms, for example, are now instructing their employees to refrain from wearing branded clothes or carrying luxury bags to the office.

'We are past the Crazy Rich Asians point'

The ultra-rich in China, who have been buying luxury products for more than two decades, are now considered to be connoisseurs of this market, Milton Pedraza, US-based founder and CEO of consulting firm the Luxury Institute, told Insider.

"We are past the 'Crazy Rich Asians' point," he said. "I think that was the peak and where people went: 'Boy, doesn't that look silly?'"

He continued: "Part of being in the know is knowing how to behave when you're truly wealthy and you're seasoned wealthy — as opposed to new money."

Pedraza relayed an analogy used by luxury brand consultant Erica Zohar, with whom he's co-writing a book, that compares "old money" and "new money" shoppers globally and in China to two birds: the eagle and the parakeet

"Once you've matured and you're the ultra-high net worth, you're an eagle — they stand tall, but they're very reserved," Pedraza said.

The "new money" crowd, meanwhile, behave like parakeets, he said. These birds are known for being vocal, which in a human sense translates as consumers who wear loud clothes that scream "look at me, look at me," he said.

By wearing expensive products with low-key logos, the ultra-rich are still able to project their status in a subtle way without flaunting their wealth. In that way, it's the ultimate power move.

Chinese social media's got quiet luxury down to a science

To be sure, there's being rich and looking rich, and the latter is where it's at on Chinese social media. People have spent hours dissecting and analyzing the traits and nuances of the "laoqian" style on China's Twitter-like platform, Weibo, decoding the tips and tricks necessary to achieve the perfectly coiffed air of casual luxury.

It would be an understatement to say people are captivated — posts with the "laoqian" hashtag have been viewed a collective 1.67 million times on the platform, at press time. This summer, interest in the hashtag has been surging again, spiking as influencers roll out new ideas on how best to achieve the "laoqian" look.

What all the influencers' looks have in common are the muted tones they come in. The styles are simple, with an emphasis on how the garment hangs on a person, and pieces come in solid colors like cream, brown, or black — not unlike the Western interpretation of the old-money aesthetic.

Some influencers have also uploaded video tutorials on the "laoqian" style, to guide people on how best to dress for success.

"Their dressing style is more understated and reflects a calmer temperament. Those who come from old money pay more attention to the details of dressing," read one Weibo post on "laoqianfeng."

Another person said on Weibo that adopting "laoqianfeng" is a marker of exquisite taste and good standing in Chinese society.

"If you lack taste or style, then you'll never ever be considered high class," the person said in her Weibo post.

The old-money aesthetic will hand some brands big wins in China

With the aspirational shopper strained and "loud luxury" taking a back seat, experts say it is the upper-tier luxury brands that stand to benefit. Think Richemont, Louis Vuittons, Dior and others of the fashion world that dabble in louder styles but also never waver from their tried-and-tested classics and are beacons of understated luxury.

The focus of ultra-high-net-worth consumers in China will be on design details, quality of material, and subtlety — rather than conspicuousness, Thomaï Serdari, director of the fashion and luxury MBA program at NYU's Stern School of Business, told Insider. For this reason, younger brands such as The Row, Goop, and Nili Lotan that follow this philosophy could also benefit, she said.

And while the average Joe on the street might not be able to identify a $1,700 Loro Piana cashmere jumper or the brand's $600 cap that become one of the ultimate symbols of the quiet luxury trend this year — the elite won't care.

"You don't have to show the label. Everyone in their tribe knows what it is. And if you're not in the tribe, believe me, they're not trying to impress you," Pedraza said.