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Luxury Spending Soars, as Japanese Self-Restraint Weakens
October 7, 2011
Although its economic prospects are still unclear, sales of luxury products are increasing again in Japan.
According to Reuters, Japanese sales of high art, jewelry, and precious metals all rebounded for the first time in 52 months in June and increased a further 5.3% in July. Sales increased a further 4.8% in August despite the Nikkei Stock Average dipping below 10,000 yen. Furthermore registration of new imported luxury cars increased over the same period with BMW (2.7%), Mercedes-Benz (7.0%) and Audi (35.5%) all showing increases.
This trend appears to defy retailers' traditional concern that luxury sales decrease when the Nikkei Stock Average falls below 10,000 yen.
The increased sale of luxury products also demonstrates Japanese are moving away from the Jishuku (mood of self-restraint) many consumers fell into following March's disastrous earthquake, tsunami and nuclear accidents. According to an unnamed industry expert, there has been a rise in the number of number of marriages following March's disasters, as many couples have "rediscovered" the importance of emotional bonds. This renewed interest in marriage has led to increased demand for luxury bridal jewelry. Consequently the sales of bridal jewelry products, such as rings from luxury brands, almost doubled compared to before the disasters.
Given the prolonged rise of the yen and looming tax increases, however, Japanese economic prospects still seem vague. The current up-tick in luxury sales may not be enough to power Japan's economic recovery in the long run.
October 4, 2011 Reuter
