The NY Times is reporting the luxury category has posted 10 consecutive months of sales increases when compared to the previous year. The NY Times states that luxury good sector was hurt during the recession, but has more than recovered over the past year with the wealthy willing to spend liberally on luxury goods with ever increasing prices. Perhaps it is pent up demand, or just the stock market performing better (although that may be changing after the downturn this week) with July showing an 11.6 increase over last year, but HNWI are spending freely on luxury goods.
The NY Times reports
The rich do not spend quite as they did in the free-wheeling period before the recession, but they are closer to that level.
The luxury category has posted 10 consecutive months of sales increases compared with the year earlier, even as overall consumer spending on categories like furniture and electronics has been tepid, according to the research service MasterCard Advisors SpendingPulse. In July, the luxury segment had an 11.6 percent increase, the biggest monthly gain in more than a year.
What changed? Mostly, the stock market, retailers and analysts said, as well as a good bit of shopping psychology. Even with the sharp drop in stocks over the last week, the Dow Jones is up about 80 percent from its low in March 2009. And with the overall economy nowhere near its recession lows, buying nice, expensive things is back in vogue for people who can afford it.
“Our business is fairly closely tied to how the market performs,” said Karen W. Katz, the president and chief executive of Neiman Marcus Group. “Though there are bumps based on different economic data, it’s generally been trending in a positive direction.”
Click HERE to read the NY Times article on luxury goods.
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