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Saturday, May 25, 2024

South Koreans are the world’s biggest spenders on luxury goods

If you go out to any social gathering in Seoul or any big city in South Korea you will be surprised to see ladies showing off Bulgari’s Deva’s Dream or Van Cleef and Arpels jewelry collection. Even in small social gatherings like school functions, every second mother is seen wearing a Moncler winter jacket. The cars parked outside are Mercedes-Benz sport-utility vehicles.

The potent mix of Korean status seekers cashed-up homeowners and you only live once millennials have made South Koreans the world’s biggest per-capita spenders on luxury brands. According to the latest report published by Morgan Stanley, South Korean spending on designer items increased by 24 percent in 2022 for items ranging from designer bags to puffer jackets. The average spending comes to $325 for every man, woman, and child.

The trend toward luxury was fueled by the South Korean housing boom as the value of property during the pandemic doubled in some cities, giving a feeling of wealth to homeowners. Younger South Koreans that obviously could not buy expensive properties opted to spend their income on luxury treats. Their motto is you only live once, so why not enjoy life!

Consumer confidence reached new heights as the prices of stocks, cryptocurrency, and housing were rising. Not all Koreans benefited from the economic boom but most after seeing their friends and acquaintances going up the ladder thought the party will go like this forever.

A young Korean lady earning about US$24,000 (RM102079) a year at an insurance company, bought a 1.6 million won (RM5516) Marni handbag in 2020. She said most of her friends have at least one luxury handbag. She said social media bragging about luxury shopping also influenced most youngsters.

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