nice watches

Sales of luxury products are soaring and consumers are increasingly happy to splash their cash online as brands begin to master premium web retailing

Any consumer of news media these days would think the whole world is descending into chaos. The markets are behaving like spoiled teenagers with chronic mood swings; Eurozone countries are playing musical chairs with their Prime Ministers and I’m a Celebrity… is back on our screens.

However, there is one sector that is quietly and confidently resisting this downward spiral – the luxury goods market, and, in particular, fine watches and jewellery.

In November, luxury goods group Richemont posted its results for the six months to September 30, showing sales had increased by 29% to €4.21bn (£3.53bn) and that operating profit had increased to €1.08bn (£934m) compared with the same period the previous year.

The jewellery houses owned by the group experienced a sales increase of 34% over the six months, with Cartier and Van Cleef & Arpels performing particularly well, while its specialist watchmaking sector had sales growth of 30%. When you consider that Richemont owns brands such as Jaeger-LeCoultre,Vacheron Constantin and Richard Mille, it’s obvious that this growth isn’t being driven by volume sales.

Richemont was not an exception to the rule. Luxury group LVMH, which owns brands such as Tag Heuer and De Beers, saw its watch and jewellery sector grow each quarter for the first nine months of 2011, showing organic growth of 26%. Burberry also reported a net profit of £117m for its six months ending September 30, and revenue of £830m.
“There will always be a market for luxury jewellery in any economic climate,” explains Jersey Pearl director of wholesale business Mike Taylor. “However, it is puzzling that, in the midst of a recession, the luxury goods market has experienced significant growth.”