The recession has put a huge dent on the luxury market in the United States, with many consumers no longer able to go on a shopping spree at Tiffany or Neiman Marcus.
But that’s not the case in emerging markets, especially China.
The Chinese, counting both those at home and traveling, have forged ahead of both the Japanese and Americans to become the top buyers of Louis Vuitton clothes and handbags and Hennessy cognac.
That’s saving the day for France’s LVMH Moët Hennessy, helping the company escape the recession sooner than expected. LVMH is slated to increase the number of its Vuitton stores in China by 50 percent, to 30, before year-end.
And it’s not just LVMH that’s benefiting from splurges by Chinese consumers.
Daimler, the maker of Mercedes, reported that Chinese sales soared 56 percent in September from a year earlier.
Emerging markets will account for at least 80 percent of growth in the luxury-goods sector, averaging around 9 percent a year, compared to only 2 percent in the developed world, Deutsche Bank analyst Francesca Di Pasquantonio told The Wall Street Journal.
So it’s no wonder that LVMH has stores in India, Indonesia, Vietnam and is opening one soon in Mongolia.
The wealthiest Americans also are doing their part to keep the luxury market afloat.
A Unity Marketing survey of Americans with average annual income of $228,800 showed that their luxury purchases jumped 29 percent in the third quarter from the second.
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