Playboy Brand Expanding in China

LOS ANGELES — Playboy Enterprises has cut a licensing deal with Chinese company, Handong United, to manufacture and distribute Playboy-branded apparel and accessories.

Under terms of the deal, Playboy merchandise will be placed in 400 new locations across China, boosting its total number of outlets to 3,500. The company reportedly also plans to build flagship stores in major Chinese cities.

To the average Chinese consumer, the iconic bunny logo has nothing to do with sex. In fact, the best selling merchandise includes bunny-ear logo products — sold mainly to Chinese men — men’s dress shirts and suits, bags and shoes.

According to Matt Nordby, Playboy’s president of global licensing, the brand also plans to branch out to women’s shoes and attract more female consumers to bunny-labeled products. "Playboy has generated $5 billion in retail revenue in China in the last decade, we're looking to double that number over the next decade," Nordby told CNBC. 

The executive noted that although Playboy has been an accepted local brand in China for the last 20 years it wants to expand to a younger demographic. “Mainland consumers have been inundated with brands, it’s about standing for something they understand.”

“We're enhancing our licensing portfolio with long-term, brand-enhancing partners, and Handong United is a partner that can deliver a premium and superior product quality," Nordby said.

Although Playboy has never sold its magazine in China because of censorship restrictions, it's investing heavily in efforts to tap into China's rising middle class.

"China is one of our most important markets," Playboy CEO Scott Flanders said in a statement. "To achieve this leadership position without ever having a media entity in China is a testament to the tremendous power of our brand."