Singapore Management University's Associate Professor Seshan Ramaswami said this is not atypical. Spending patterns during past recessions have shown that indulgence products do not fare that badly.
What people hold off buying are big household durables such as 50-inch plasma TV sets, cars or a new home, as these are often bought on credit and involve monthly debt repayments. But having forgone larger, big-ticket indulgences, they seek out smaller, affordable luxuries in bad times.
Retail expert Lynda Wee, who has a PhD in retail marketing, agreed: 'Since buying a new home is no longer affordable, people may think, 'Let's own that dream bag or watch first'.
'Consumers buy to de-stress in a down period, to feel good so that they can keep going on with their work, and to keep their spirits high.'
Indeed, 11 shoppers interviewed at high-end brand name shops in Takashimaya and Paragon shopping centres said they knew they are not immune to the recession. A 25-year-old lawyer, who had just paid over $3,000 for a Louis Vuitton bag, and declined to be named, said: 'Life has to be worth living. Why am I working so hard if I can't buy a handbag I want?'
Ms Candice Lim, 29, who was stocking up on handmade Belgium chocolates at Godiva, spoke like a true banking executive when she said: 'You have to figure out what your personal recession is. What are you willing to bear?
'Some like me are willing to hold off on buying a BMW or a 50-inch LCD TV set. But don't ask me to give up my favourite Godiva chocolates. They keep me going in these stressful times.'
This article was first published in The Straits Times on November 09, 2008.
