Think of the world's biggest luxury brands and you might think Burberry, Ralph Lauren, Gucci, Hermès, Cartier, Tiffany and Louis Vuitton.
They will almost be almost exclusively western companies.
But who is buying these brands? It isn't depressed US and European consumers, for whom austerity chic is the order of the day.
Nearly half of luxury goods sales are made to consumers in buoyant emerging markets, led by China, where brand-hungry consumers are keen to flaunt their newfound riches by wearing glitzy global names.
When western luxury brands and Eastern money come together, you have a great investment story. It could be a safe and stylish way to play emerging markets.
Western perfume, haute couture, jewellery and automobile brands are profiting from the growth of China and other emerging markets, says Laurent Belloni, the co-manager of Pictet Premium Brands, a mutual fund that invests in leading luxury names such as LVMH, which owns the likes of Louis Vuitton, Tiffany & Co, Burberry, Ralph Lauren, Christian Dior and Nike.
Investing in western companies is a clever way to play the emerging-markets story. "You are buying big, established household names with a massive global reputation," Mr Belloni says. "This is much safer than investing directly in emerging-market companies, which tend to be more cyclical and volatile and may also have weaker levels of corporate governance."
This should give you the best of both worlds, the excitement of quick-fire Eastern growth and the reassurance of old-world western stability.
Emerging-market consumers already consume about 40 per cent of luxury goods and that figure is likely to rise sharply, Mr Belloni says. "China, including Hong Kong, Macau and Singapore, now accounts for 25 per cent of the global luxury market. A decade ago, it was only a tiny proportion."
The balance of buying power has shifted. Japan once accounted for 40 per cent of luxury goods sales. Now it buys just 15 per cent.
Russia and India should steadily boost demand for luxury products. "By the end of the next decade, 60 per cent of luxury sales should come from emerging markets," Mr Belloni says.
Better still, luxury brands such as Gucci enjoy higher operating margins in China. "An item that sells for US$100 [Dh367] in France would typically go for $114 in China. That's partly due to taxes and partly because consumers are willing to pay a higher price."
Local operating costs are also relatively low. "The major brands may have just one or two flagship stores in China, but the profit per square foot is much higher. Given the shortage of stores, when consumers come, they tend to spend more."
Many Chinese and emerging-market tourists also embark on a luxury brand splurge on their trips to Europe. "They know prices are much cheaper. Incredibly, half the items luxury companies sell in Europe are actually bought by Chinese tourists," Mr Belloni says.
With GDP growing at nearly 10 per cent a year, the number of super-wealthy Chinese is rapidly multiplying. There were 271 dollar billionaires in China in 2010, double the number in 2009, according to the Hurun rich list, which is published by the Shanghai-based magazine Hurun Report. Only the US has more, with over 400. China also boasts more than one million dollar millionaires.
They're rich and they are keen for people to know it, Mr Belloni says. "They want visible luxury, accessories such as handbags, watches and belts. They also get into luxury at an early age. In Japan, a woman might buy her first Louis Vuitton handbag at age 35. In China, she will be 25."
Consumption is only 36 per cent of Chinese GDP. "In the US, it is 65 per cent and in Europe around 60 per cent, so there is plenty of scope for growth. China has also been considering reducing import taxes on luxury goods to narrow the price with Hong Kong. That will also drive consumption," Mr Belloni says.
The flourishing market in fake luxury goods has little impact on sales of the real thing. "The fake market will always be there, but when people have enough money, they want the real thing. Most Asian customers care about quality and attention to detail. They don't want counterfeits."
Chinese billionaires aren't the only ones who want western brands in their lives and homes. So does the vast emerging middle class.
Their numbers are projected to grow from 430 million in 2000 to 1.2 billion in 2020, an increase from 7.6 per cent to 16.1 per cent of the world's population.
Asian consumers spend four times as much of their income on luxury as their western counterparts, says Nicole Vitesse, the client portfolio manager at JP Morgan, whose Global Consumer Trends Fund targets companies that will benefit from shifts in global consumption patterns. "Asian countries haven't developed their own luxury brands, so consumers look to the West. They want to carry a Gucci handbag or drive a BMW and the likes of LVMH, Gucci, Guess and Abercrombie & Fitch recognise the opportunities."
Fidelity, the fund manager, has named Burberry and Hugo Boss as two luxury stocks to watch.
Burberry is a strong franchise with an excellent management team and robust balance sheet, says Tom Ewing, the portfolio manager at Fidelity UK Growth. "It has a strong presence in China, where the rapidly growing middle class is increasing its demand for aspirational goods. Demand from developed markets has also held up well."
Hugo Boss boasts low levels of debt, strong cash flow and a generous, rising dividend and is only just beginning to exploit its emerging-market potential.
Emerging-market consumers are demanding luxury products across almost every sector, notably cars, says James Thomas, the regional director at Acuma Wealth Management in Dubai. "BMW has more specific models just for the Chinese car market. In China, Porsche is better known for its SUV and saloon cars."
Another German car manufacturer, Volkswagen, which owns a fleet of brands including luxury names such as Lamborghini, Bentley and Bugatti, makes 50 per cent of its sales in China.
Brand-hungry Chinese consumers are making their presence felt in the Middle East as well, Mr Thomas says. "We are seeing Chinese nationals flying to the UAE to purchase luxury goods in the local malls."
As with every specialist investment area, you should invest no more than 5 per cent to 10 per cent of your portfolio in luxury brands, Mr Thomas says. "Although the sector is growing, it could also fall quickly if circumstances change."
Emerging-market consumers aren't just spending their money on fast cars and fashion, they are also splashing out on everyday products. "Many are buying their first ever electrical appliance, medication or electronic device and this market also offers great growth potential."
If you want to play this trend, Mr Thomas recommends a number of offshore mutual funds, including Clariden Leu Luxury Goods Equity, Julius Baer Luxury Brands and SCAM Equities Luxury and Lifestyle.
If you prefer direct equities, large, stable US multinationals like Coca-Cola, Procter & Gamble, Johnson & Johnson and McDonald's now generate large portions of their revenue from emerging markets, says Aris Vatis, the portfolio manager at Fidelity American. "The US remains the location of choice for leading brands and technology firms. They offer exposure to China and wider emerging-market consumer growth, without exposure to the higher volatility associated with this region."
The growing global middle class will also boost sales of food, feed and fuel, says James Govan, the co-manager of the Baring Global Agriculture fund. "Demand for agricultural equipment in the US and western Europe is likely to remain high thanks to strong farm cash receipts, with positive implications for US companies such as Deere & Co."
David Kuo, from Motley Fool, the stocks and shares website, is also excited by the impact of the mass affluent on western stocks. "Shoppers around the world want similar things. We have already seen unprecedented demand for luxury goods among wealthy emerging-market consumers. As wealth filters down, we can assume they will demand the basic household goods that western shoppers take for granted."
Mr Kuo tips Unilever, a UK-listed company whose global brands include Persil, Domestos, Dove soap, Ben & Jerry's, Bertolli and Walls. "It already generates 40 per cent of its revenue from Asia and Africa and this should rise as wealth improves in these regions," he says.
Mr Kuo also rates Procter & Gamble, whose global brands include Daz, Duracell, Gillette, Silvikrin, Pringles and Fairy Liquid. "It boasts a boatload of brands spanning beauty, household care and pet foods. Currently, it generates about one third of its sales from developing markets and is increasingly shifting its emphasis from cash-strapped western shoppers to developing market consumers."
Another UK-listed stock, Reckitt Benckiser, is also committed to driving growth in Asia. "Its products, which include Finish dishwasher tablets and Vanish stain remover, could soon be as ubiquitous in developing economies as they are in the West."
Ditto Swiss food giant Nestlé. "It is the world leader in coffee and bottled water. Throw in baby formula and frozen pizza and you have a company that could dominate food sales around the world," Mr Kuo says.
The emerging middle class is also spending more money looking after its health and, again, western companies will benefit, says Ms Vitesse. "People are demanding better health care and medicine. They remember the 2008 China milk scandal, where more than 300,000 babies fell ill after drinking tainted milk, and feel safer with a western company. This trend will grow as the population ages and global health care companies such as Zimmer, Merck, Glaxo and Sanofi should all reap the rewards."
The emerging world may have the money these days, but the West still has the brands. And luxury investors can't afford to ignore that fact.