The recession put a crimp into sales of luxury goods, but not for web-only retailers, according to data released today by American Express Co.
Luxury goods retailers that sell exclusively online increased their sales by 87% last year compared with 2008, even as overall luxury sales declined 20%, says American Express, which mainly targets affluent consumers and business travelers. For retailers that sell both online and through stores, sales inched up 0.7%, although the web typically represents a small part of their sales, the company says in a report entitled “From Peak to Recovery: Snapshots of Global Luxury Spending.”
“On a year-over-year basis, luxury spending began to stabilize in the second half of 2009 with growth taking hold in the first quarter of 2010,” says the report. “This emerging trend was most evident outside of North America with India and Brazil leading the pack through March 2010.” Luxury sales growth exceeded 50% year over year in emerging economies like Brazil and India in February and March 2010, while North American growth was just over 20%, American Express says.
The first-ever report on luxury spending was prepared by American Express Business Insights, and was based on sales at 700 luxury retailers around the world by the 90 million American Express cardholders who spend $111 billion annually on luxury goods.
The American Express study is in line with other recent reports showing a rebound in luxury spending and traffic to luxury e-commerce sites. MasterCard Worldwide reported in its SpendingPulse report for March a 22.7% increase year over year in spending on luxury items, online and off. And Experian Hitwise reported this week that traffic increased 28% to a group of 54 luxury and designer e-commerce sites in the week ended April 10 compared with a year ago.