What's going on?

On Friday, the world�s largest luxury company LVMH Mo�t Hennessy Louis Vuitton announced that it would buy luxury hotel chain Belmond for $3.2 billion (tweet this).

What does this mean?

Belmond owns a string of luxury hotels and venues, including the Venice Simplon-Orient-Express train in Europe and the 21 Club in New York City. LVMH already owns the Bulgari and Cheval Blanc hotel brands. Adding Belmond to its bag will move the company further into �experiential� luxury � a rising trend where people spend big on luxury experiences rather than luxury goods.

Why should I care?

For you personally: �Being� rather than �having�.

A few years ago, experiential retail was the next big thing � many stores were overhauled in an attempt to leave customers with something more than just lighter pockets. Retailers hoped this would help them compete against ecommerce � one of the few things Amazon can�t sell online is an in-store experience (or can it?). While luxury has trailed retail in the shift to digital, US online luxury sales are expected to reach 25% of total luxury sales by 2025 (up from 9% now). With Richemont buying Yoox Net-a-Porter and luxury online marketplace Farfetch going public earlier this year, luxury might finally be catching up with retail more broadly � using hotels, restaurants, and trains to create high-end real-life experiences beyond just shopping.

The bigger picture: Keeping Chinese luxury-seekers.

China loves luxury: the country accounts for one-third of global luxury sales and is expected to make up 60% of global luxury growth over the next decade. But with slowing Chinese economic growth (partially on account of that pesky trade war) and a crackdown on �daigou� � smuggling luxury goods into China for resale � high-end purchases could be on the chopping block for some Chinese consumers. LVMH may hope that giving Chinese travelers more luxury options will help it continue to bring home the Chinese luxury bacon.