Global Luxury Brands and Recession

Global Luxury Brands’ Strategies to Fight Recession

Global luxury brands’ strategies to Fight recession
Choi Soon-hwa

Luxury brands are actively responding to the latest economic downturn, said to be the worst since the Great Depression, racking their brains to escape the grips of the falling luxury goods market. Indeed, the hit to sales has been particularly bad as industrialized nations, traditionally the main luxury good markets, have suffered greatly. With luxury goods consumers having become more diversified by region, class and age, and an increasing number of luxury brand companies adopting professional management structures, luxury brands are approaching their
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marketing and brand strategies in a more systematic manner than in the past.

Consumption Keywords in the Global luxury Goods marKet
Consumers of luxury goods can be divided into three groups: “absolute consumers,” “trigger consumers” and “bandwagon consumers.” The first group is comprised of super-rich global leaders with worldwide influence, while the sec-

Keywords of Consumption in Luxury Market amid the Economic Downturn
Luxury goods consumers Impact of the downturn
The super rich, the top 0.5% of the population •10millionHNWIworldwide(1) • 18,000HNWIinKorea 1 Private consumption pattern •Preferencesforrarebrandsandproducts High-income earners, top 5% of the population •Highly-educatedprofessionals(monthly wageofover7.5millionwoninKorea) •Increaseinhigh-incomeearners inemergingmarkets Settingthetrendinhigh-endmarket •Interestedinexpensiveandpopularbrands •Sensitiveaboutsocialand environmentalissues

Changes in consumption pattern in the downturn

Keywords of consumption in the global luxury goods market in the downturn

Weak

Maintaining original consumption pattern •Upscalinginconsumption •Differentiationfrompopularmarket •Greaterawarenessofsnobappeal

1. “Discrete” Consumption • referenceforultraP