Wealth-X report highlights how the luxury sector has been impacted by the pandemic but wealthy people still want to spend
One of the benefits of being wealthy is being able to indulge in luxury goods, but has that changed in 2020?
While the look and scale of the pandemic-driven challenges faced by the world’s rich may differ from most of us, they have felt the impact. And they are cautious about the near future.
Wealth-X has published The Global Luxury Outlook 2020: A World of Changing Preferences, which explores the interlocked relationship between wealth growth and the development of the luxury goods and services industry.
It found that growth in the industry has been halted by the pandemic, but that wealthy (and particularly ultra-wealthy) people are still spending on luxury, albeit in a different way.
Access to the best restaurants in town is a given for the wealthy, but not during lockdown. So there has been a shift towards spending on luxury experiences in their own homes, whether restaurants providing a dining experience or luxury ingredients being provided for private chefs.
There has also been a boost for the private jet market compared to the impact suffered by commercial airlines, as wealthy fliers opt to travel without the general public.
Luxury cities
The report includes an analysis of the world’s ‘luxury cities’ based on population of wealthy individuals, development of the luxury retail market, and luxury lifestyle.
New York leads the pack with Tokyo, Hong Kong, London, and Paris completing the top 5. Eight of the top 15 cities are in Asia.
Digging down to affinity for luxury among gender groups, women are more likely to favour art and jewellery while men are more attracted to classic cars, horses, and sports teams.
The report also found that ultra-high net worth individuals (UHNWIs) with inherited wealth are more likely to have a high affinity for luxury than those who are self-made.
It suggest that this may be due to those who are self-made devoting more of their time to running their business as well as a larger share of women among those who inherited their fortunes. The study found that women are more likely to have a high affinity to luxury.
The full report is at https://www.wealthx.com/report/global-luxury-outlook-2020/.
