Luxury consumption gears up, production of giant brands is increasing

This area, which has been drawing a rising graph in sales especially since 2021, is growing rapidly in Turkey as well as abroad. How is the luxury market growing so much when the world is so focused on fighting inflation? I’ll give the details soon, but before that, your expensiveness; I would like to share with you the beautiful observation of Dünya Newspaper Writer Şeref Oğuz, about how it affects the rich, the middle class and the poor. The title of the article is: ‘Inflation has exceeded 80, but how expensive is life for whom?’.

Şeref Oğuz shares the following sentences in his column: “Everyone’s life is more expensive to himself… Rich; feels the cost of living like a sweet breeze. center post; like a freezing wind… A hurricane for the low-income… Life doesn’t come at the same cost for everyone. The one who is born with a silver spoon in his mouth and the one who cannot find a bite to put in his mouth will pay the price of life differently. So, how expensive is life to whom? To a newborn baby; his food is so expensive to be locked up in the market… To a student; It is expensive enough to spare the oil while boiling the pasta. to a worker; It is as expensive as the fee for trying to catch the full-bridle labels on foot. As for the housewife, it is so expensive that she will wander around the bazaars to find black water on her feet in order to find the cheapest 5 liras.” While Şeref Oğuz impresses us with his correct determinations, let’s take a look at what’s going on in that glamorous and luxurious life…

‘We produce day and night’

Let me summarize the situation in luxury retail as follows; sales have exploded. From jewelry to watches, from bags to clothing, luxury brands have to make tight plans for production because there is tremendous demand. In order to control production, they increase their factory capacities, in addition, they buy workshops and factories. Why this increase in consumption? Because people just came out of a psychological exam and they act with the logic of ‘life is short’ and ‘let me reward myself’. The wealthy always have a budget for luxury, and the luxury segment is always the last to be affected by economic ups and downs. The other day, we took a look at the luxury market with Burak Çelet, the General Manager of Desa, which manufactures for world-famous brands. Çelet’s comments are as follows: “Turkey’s retail sector had a very strong summer thanks to the tourists. The share of locals in sales decreased. The EU recession scares the exporters producing in the basic segment. There is no problem in the luxury segment, on the contrary, we have to work day and night until the end of the year to fulfill the orders… One of the leading brands in the luxury segment in the world, where we have been producing for many years, has now reached the highest order capacity of the last 15 years. Samsonite’s world sales also follow a parallel course. In the world, especially travel retail has exploded.”

They buy factory

We are looking at another luxury consumption area, jewellery. We ask Mustafa Kamar, Chairman of the Board of Directors of Roberto Bravo, one of the important brands of the Turkish jewelry industry, which is at the jewelry fair in Vicenza these days, how things are going. As you know, Roberto Bravo is one of the brands that appeal to the luxury segment. Kamar, who conveys his views to us from the fair, where the pulse of the world jewelery industry is beating at the moment, says the following: “There has been an explosion in the jewelery industry, especially since 2021, with the pandemic. People’s tendency to shop has increased. 2021 was much better than 2019, even though it was a pandemic year… Currently, jewelers in brand position have filled their orders for the next 6 months. Foreign brands began to increase the number of factories. They even buy workshops and factories in Italy, Switzerland and France. Right now, they have started to not be able to produce their products because… I talked to an Italian manufacturer that produces for a luxury brand the other day, and he said, ‘I filled my orders until April’. There is an incredible demand for luxury.” Explaining that Roberto Bravo received a great demand from the USA and Europeans, Kamar announced that they have grown in these countries with the shop in shop model and that they will open an office in Miami in the near future.

The clock kept the ‘absence strategy’!

Recently, there has been a great activity in the luxury watch industry. It is necessary to wait close to two years to buy some models of world famous brands such as Rolex and Patek Philippe. These brands apply a marketing tactic with the ‘absence strategy’ and it seems that this is quite stimulating the market. Sales are also increasing in the second hand of the luxury watch. Serdar Oal, Co-Founder of Horopool, the second-hand luxury watch sales site, said, “The prices of luxury watches are constantly increasing. Despite this, how do you evaluate the increase in sales?” When I ask him, Oal explains: “The Swiss Watch Industry Federation (FHS) recently announced the export figures. Accordingly, in the first half of this year, watch exports from Switzerland increased by 12 percent to 12.3 billion. dollar (11.9 billion Swiss Francs). While there is an increase in luxury watches, there is a decrease of nearly 35 percent in watch exports in the sub-segment between 200-600 francs. Difficult economic conditions affect the middle segment. When we look at the luxury side, the increase continues. Because the wealthy always have a budget to spare for luxury consumption.”

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