Luxury Sales Expected to Bounce Back Quickly
Experts are predicting that the sharp drop in luxury sales driven by fears of the coronavirus will bounce back quickly, once the virus has been contained.
Analysts at Jefferies are estimating that it should take eight weeks from the point of containment for luxury spending rates to return to normal. However, it is still difficult for experts to forecast just how far away we are from containing the virus, as the number of new confirmed cases continues to grow and arise in new countries.
Even once this containment has been reached, consumers in heavily affected regions will likely be wary about returning to public spaces right away, and for many, luxury purchases may not be high on their agenda at this point. However, online sales have increased in China since the outbreak – Kering have reported steady sales for the first months of 2020, which should reassure brands that the demand for luxury products is still strong.
It is important that brands consider other avenues while the crisis is still ongoing, and to find new ways to meet the changing demands and needs of their customers, if a strong recovery is to be possible.