Wealthy cut spending according to American Express
The top tier of luxury consumers curbed their spending on high-end clothing, accessories and jewelry in the first half of 2011, while regular consumers picked up the slack for the first time since the 2008 financial crisis, a study by American Express’ consulting unit said Thursday.
Sujata Bathia of American Express Business Insights said that the slowdown in spending by fashion enthusiasts — defined as the top 5 percent of spenders on luxury goods — was seen across the globe.
In France, one of the world’s key markets for luxury, spending by that group was down 10 percent in the first half, compared with a year earlier.
The other 95 percent of consumers made up some of the slack, with their spending on luxury goods increasing by 13 percent in the first half of the year, according to the report. French fashion fans have been the motors driving luxury consumption since the 2008 economic downturn, and even with their 2011 drop in spending, they still account for 61 percent of all spending in the sector. And even with the cut, they are still spending at a higher level than before the crisis, the report said. This year, the group has shifted its spending more to electronics, dining and luxury hotels.
Asked what had sparked fashion enthusiasts’ newfound restraint on luxury purchases, Bathia attributed it to "fashion fatigue, or maybe the sexiness of the new iPad." She added that it was "too soon to see if it’s a lasting trend."
The study was carried out in the U.S., U.K., France, Hong Kong, Japan and Australia.