Luxuriating in recession
Luxury brands have been hit by less ostentatious attitudes during the recession. Marketing has had to become more discrete and brands have rediscovered exclusivity
The recent credit crunch has impacted luxury consumerism in an unprecedented way. Up to a quarter of high net worth individuals' wealth disappeared and the future still looks uncertain. Sales, discounts and layoffs have now invaded the luxury world. The diagnosis is clear – luxury is not recession-proof anymore.
Through previous economic cycles, the manifestation of luxury may have changed according to people's attitudes, the ability to pay for it may have been reduced from time to time, but its appeal has always remained.
In the current turbulent environment, we can expect luxury to redefine itself once again. With the recession, luxury appeals to the rational brain again. 'The higher the price, the better' is no longer valid. Price does matter, and people reassess the value they can get and maximise it. However, creating added value for luxury is not about money off.