Strong growth in the global luxury market
Growing demand in Asia is boosting business in luxury goods and exclusive experiences. According to a study by management consultants Bain & Company and the Italian luxury goods association Fondazione Altagamma, the global luxury market is likely to have grown by 8 to 10 percent this year to a record value of 1.5 trillion euros.
In particular, sales of luxury experiences such as exclusive cruises and hotels increased strongly, Bain reported on Tuesday. Demand for luxury cars also rose sharply. Sales in the core segment of personal luxury goods - expensive clothing, shoes, perfume and jewelry - are expected to increase by 4 percent to 362 billion euros by the end of the year. However, there are signs of a slowdown in growth in this segment. A third of brands are likely to stagnate or shrink next year.
Tailwind for the industry continues to come from Asia. According to the study, demand in China grew by 9 percent, in South East Asia by 8 percent and in Japan by as much as 17 percent. In Japan, "the luxury business is booming, which can be attributed to both the loyal local clientele and the influx of tourists due to the weak yen."
In Europe, sales from luxury tourism have almost returned to pre-pandemic levels. Bain and Fondazione Altagamma expect the market for personal luxury goods here to grow by 7 percent to 102 billion euros. In America, on the other hand, business is expected to decline by 8 percent to 101 billion euros. "The luxury clientele there continues to have purchasing power, but has mainly continued to consume abroad, as the strong US dollar favors overseas purchases due to price differences."
The surge in luxury tourism in Europe has nearly restored pre-pandemic sales, contributing to an anticipated growth of 7-10% for personal luxury goods in the region. Moreover, the influx of tourists in Japan, driven by the weak yen, has significantly fueled the demand for luxury cars and experiences, contributing to the booming luxury market in the country.
Source: www.dpa.com
