Russian High-End Tastes Are Changing

Are Russian shoppers changing what they want to buy, especially with higher-priced goods? As their tastes change, sales of $10,000 Hermes handbags and $5,000 Chanel dresses are accelerating in the former communist country, spurring brands such as Prada and Louis Vuitton to open more stores there. Sales of luxury goods in Russia expanded 6 percent to $8.8 billion last year, versus 4.6 percent in 2011, helping reverse a 20 percent decline between 2007 and 2009, according to Euromonitor International Plc. While that's slower than China's 18 percent luxury growth in 2012, it's far better than Western Europe, where sales fell one percent last year as the debt crisis weighed on domestic spending, the researcher estimates. "What we're seeing now is a comeback" in Russian demand for luxury goods, said Hermes International (RMS) SCA deputy chief executive officer Patrick Albaladejo. Story