Rising mortgage bills, fears about jobs, soaring utility costs. The reasons for the slowdown in consumer spending are boringly familiar.
But what if your business operated in a market where none of this mattered to your customers? Shoppers who don’t have to worry about mortgages because they’ve never needed one and wouldn’t recognise a gas bill if they saw one.
Welcome to the world of the luxury retailer. A world that has proved gloriously immune to the tribulations of the global economy and where retailers have continued to power ahead in stark contrast to the mass market.
Critics say the luxury retailers have been lucky. The UK and London in particular has become a magnet to the super rich from the world’s emerging economies, encouraged by the UK’s laissez-faire approach to tax and regulation.
But to say that luxury retailers have simply ridden the back of this wave would do them a disservice. To secure their share of the huge spending power of these shoppers requires great stores and an experience that oozes exclusivity – something London’s luxury stores are experts at.
What the luxury retailers do especially well isn’t just relevant to them. Their relentless focus on the customer and product has paid off. They have continued to invest in the experience. And, while the application will inevitably be different, these principles can be applied to any type of retailing.
After such a good run, luxury retail is nearing a crossroads. The bigger they come, the harder they fall and the global credit crunch is creating fears that bonuses will be squeezed and City jobs lost. The Government’s efforts to get its hands on more of the wealth of rich foreigners based here is also a genuine threat.
In what are going to be tougher times for the luxury specialists, staying ahead of the game will be crucial. This will mean ditching the entrenched distrust many of them have of the internet. They may have the best stores in the world, but not many can claim to have the best web sites.
Something to celebrate
In tough times it’s important to celebrate the positives, so here’s to today, February 29. A whole extra day’s sales and, even better, it’s a Friday. Let’s hope it’s a good one.