TOKYO—Japan’s market for luxury goods in showing signs of improvement, according to a new report from McKinsey & Company.
The consultancy, which surveyed both shoppers and executives, said the Japanese consumer “appears to be emerging from her deep slumber” although she’s more discriminating and price-sensitive than ever, seeking out deals at outlet malls or online.
McKinsey said it doesn’t expect the Japanese luxury market to experience ”significant growth” anytime soon but it emphasized that the mood of both executives and consumers has improved substantially since last year.
The report, written by Brian Salsberg and Naomi Yamakawa, said that 80 percent of the 15 luxury goods executives surveyed expect their companies’ performance to improve this year compared to 2009. Breaking the numbers down further, 33 percent said they expect their companies’ annual sales to grow 10 percent or more.
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Last year, 85 percent of the executives surveyed said they anticipated their companies’ 2009 sales to decline compared to 2008.
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This year, McKinsey surveyed 750 shoppers who had purchased a luxury item between April 2008 and March 2009 and said that consumer morale is picking up.
“The data supports a statistically meaningful improvement across a number of attitudinal statements from the prior year,” McKinsey said.
Specifically, the number of consumers who believe that “owning luxury goods is not as special as it used to be” declined from 49 percent in 2009 to 39 percent this year, the consultancy said.
McKinsey said the number of Japanese shoppers who “don’t feel the need to buy luxury brands because more affordable non-luxury brands offer good enough style” declined from 21 percent last year to 12 percent this year.
In May, Yano Research Institute Ltd. said sales of imported clothing and accessories in Japan tumbled a record 15.9 percent last year to 894.6 billion yen, or $9.57 billion at average exchange for the period. Sales growth in 2010 is expected to inch up less than one percentage point, Yano said.