Can the luxury business survive a change in Japanese tastes?

By wpcomimportuser1 | June 24, 2008 | +

My friend Vanessa Friedman, who has the incongruous title of fashion editor of the Financial Times, has a new video up on the FT site. It’s kind of long, and weirdly serious in tone, but the story Vanessa tells is fascinating: Japanese consumers, who have kept the global luxury-brand business going for the past 20-odd years, have begun to realize that there might be more to life than Vuitton bags. So the luxury guys are all banking on Chinese consumers becoming just as big suckers for overpriced European brand names as their not-so-friends across the East China Sea. And so far, it’s going great.

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My God, Vanessa needs to work on that slow, monotonous delivery. And somebody should tell her that Japan is more than one island! I also loved when she said that the Japanese have “been responsible for 40% of the consumption of luxury goods both home and abroad.” Wouldn’t they be responsible for almost 100% of the consumption of luxury goods at home? Isn’t that true in most places?

As to the idea that the market has peaked, well, it was bound to happen sooner or later since almost every Japanese woman in her 20s or 30s owns at least one such bag, and probably a few, regardless of what her income is. (Foreigners are always amazed by this when they visit.) Then there’s the shrinking population of young people, and no society is more herdlike than the Japanese, so if brand goods fall out of fashion, the tide could turn quick, where carrying a LV bag could seem as anchronistic as a girl in Shubiya with a deep tan and thick make up.

I don’t know if the Chinese will take to luxury goods with the same fervor, considering that China is already the world’s primary source of imitation brand goods. Why pay up when you can buy the knock-offs for much less? And no one will even know the difference anyway.