Last summer, inflation in the U.S. hit a 40-year record, with consumer prices increasing 9.1%. It wasn't just those in America that were feeling the pain; in October of 2022 the rate of inflation in the EU hit an all-time high. And as inflation has risen, economic growth has slowed around the world.
However, that's not slowing down the wealthiest individuals from continuing their insatiable appetite for luxury goods. Just take a look at:
LVMH Moet Hennessy Louis Vuitton (LVMHF)., is up 37% in the past 12 months.
Ferrari (RACE) is up 24.7%.
And Hermes International (HESAY) is up a whopping 53.1%.
According to a recent joint study by Kantar Insights and Altiant, “Luxury consumers value: unique in-store moments, holistic experiences (with consistency across all facets of the brand relationship) and artistic, festive or educational events organized by brands for VIP customers.”
Kantar's survey was conducted in the U.S., China, Germany, France, Italy, and the U.K. among folks in the top 5% of annual incomes. They discovered that these ultra-rich are planning to spend 38% more money on luxury hotels and restaurants in 2023 than in 2022, as well as 36% more on spas and beauty salons. Also, 35% of participants plan to spend more on ready-to-wear and haute couture, while 34% are likely to splurge on leather goods.
The study also highlights the cartography of desires around six significant motivations. For example, 29% of respondents are motivated by discovery, 18% are attracted to attention, 15% see luxury as a symbol of success, 14% are attracted to exclusivity, 12% desire heritage, and 12% love the authenticity, commitment, and values embodied by luxury brands.
On the date of publication, Andy Mukolo did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
