2015 was a tumultuous year for China’s multi-billion dollar luxury goods market. A plunging stock market, crackdowns on overseas luxury goods, and more high-profile arrests under Xi Jinping’s anti-corruption campaign are just a few factors that shook up China’s luxury market in 2015.

According to a new report by Bain & Company, some new trends in the Chinese and global luxury market have emerged. Here are five key takeaways:

1. China’s Luxury Market is Declining

Overall, purchases of luxury goods in mainland China decreased by about 2% to 113 billion RMB last year. In particular, men’s wear, watches, suitcases, and handbags have taken a drastic dive. For example, in 2014, luxury brand men’s wear decreased by 10% from 2013; by the end of 2015, the decrease is expected to be 12% from 2014.

The decline can be attributed to a number of different factors, including President Xi Jinping’s continued anti-corruption campaigns, which discourage lavish gift-giving (also known as bribes). Last April, former security chief Zhou Yongkang joined the growing number of Chinese government officials who have been arrested on charges of corruption.

In addition, last year’s stock market crash contributed to a slowdown in the luxury market, as well as increasing crackdowns on the daigou market by Chinese custom officials. Daigou refers to Chinese shoppers who purchase luxury items overseas and resell them illegally when they return to China. Between 2014 and 2015, the daigou market size for luxury goods decreased from about 55 – 75 billion RMB to about 34 to 50 billion RMB.

2. … But a Few Verticals Continue to See Steady Growth

Luxury brands in women’s wear, jewelry, cosmetics, perfume, and personal care items continued to see growth in 2015.

Since 2012, these verticals have seen steady growth. For example, luxury brand women’s wear has stayed at around a 10% CAGR (compound annual growth rate), and cosmetics, perfume, and personal care items have ranged around a 5 to 10% CAGR.

Top brands in these verticals include: Armani, Burberry, and Channel in women’s wear; Bvlgari, Cartier, and Chow Tai Fook in jewelry; and Chanel, Dior, and Estee Lauder in cosmetics.

3. Chinese Shoppers Aren’t Traveling to Hong Kong to Buy Luxury Goods

Instead, they’re opting for Japan, South Korea, and Europe. Japan was a particularly popular destination, as sales in luxury items is estimated to have increased by 251% since 2014. South Korea was second with an increase of 33%, followed by Europe with an increase of 31%.

In contrast, sales in Hong Kong and Macau decreased by about 25%.

The sharp increase in luxury items purchased by Chinese shoppers in Japan is attributed to a more open visa policy, which also explains the increasing number of Chinese tourists who visit Japan.

4. Cross Border E-Commerce is Taking Off

According to Bain’s report, cross-border and overseas websites are taking about 12% of all Chinese luxury goods spending.

Instead of buying luxury goods at department stores, shopping malls, or arranging a deal with a daigou merchant, Chinese shoppers are making purchases through websites like JD, Tmall, Net-A-Porter.com, ShopBop (acquired by Amazon in 2006), and Harrods.

Startups have also started catering to Chinese consumers through cross border e-commerce platforms, such as Kaola.com (网易考拉海购) and Mihaibao (觅海宝). To appeal to more price-sensitive Chinese consumers, startups like SECOO (寺库) and Share2 (只二) are selling secondhand luxury goods.

The Chinese government has also been helping to move luxury brand purchases online. For example, in January 2015, limits on cross-country online payments increased from $10,000 USD to $50,000 USD. The expansion of free trade zones in China also offers tax benefits to companies that conduct cross-border e-commerce.

5. Global Pricing by Luxury Brands to Boost Domestic Growth in 2016

Luxury brands like Chanel and Cartier have begun to price their items globally, shrinking profit margins for daigou merchants and reducing the price gap between Europe and Asia. Last March, Chanel was the first luxury brand to slash the prices of its handbags in China, before being joined by Cartier and Gucci, who also cut prices across their products.

In part a response to depreciating currencies such as the euro and RMB, global pricing by luxury brands will contribute to further downsizing of the daigou market and an increase in local consumption and domestic growth in 2016.

Correction (1/26/2016) 15:00: This post has been updated to correct a factual error. Mainland China’s luxury market declined to about 113 billion RMB, not by 113 billion RMB.