Conspicuous consumption in a recession: Toning it down or turning it up?

The 2008 recession reportedly led to the demise of conspicuous consumption with wealthy consumers abandoning luxury goods that prominently display their brands for more subdued designs. Utilizing data collected before and in the midst of the recession from designer handbag manufacturers, Louis Vuitton and Gucci, we find products introduced during the recession actually display the brand far more prominently than those products withdrawn. Data from Hermès and luxury ads in Vogue magazine also indicate manufacturers did not tone things down. Our results suggest conspicuous consumption endures in recessions; consumers who do not exit the luxury goods market are still interested in logo-laden products.

Research Highlights
► We find luxury products introduced during the 2008 recession display the brand more conspicuously than those products withdrawn.
► Contrary to conventional wisdom, consumers who do not exit the luxury goods market during a recession are still interested in logo-laden products, and perhaps even more so. The designer handbag product lines of two of the world's largest, best known luxury goods manufacturers (Gucci and Louis Vuitton) became more conspicuously branded suggesting a shift towards catering to these consumers.
► A review of Hermès catalogs before and during the recession, and luxury ads in Vogue magazine also indicate there was no sudden shift toward being less conspicuous, either for generally understated brands such as Hermès, or for traditionally conspicuous brands such as D&G, Prada and Fendi.