Are life's little luxuries at risk?
Despite consumers tightening their belts recently, luxury goods could still prove resilient
Rather than seeking to move up the value chain or to diversify into the emerging markets, Burberry is seeking to increase market share by appealing to a broader and less exclusive consumer. This is a move that will almost certainly see its sales impacted over the coming months as aspirational buyers dry up. This is also consistent with the fact the luxury goods market in practice tends to be a latecomer to economic downturns.
Nevertheless, at the very top of the market, luxury will tend to be resilient even in the most difficult market conditions, as scarce, well-branded goods retain their cachet across the economic cycle.
