Luxury Goods Market: Global Share, Size, Growth, Trends & Outlook ( 2023 – 2032 )
Luxury goods are premium products with standout craftsmanship and exclusivity that are at the highest end of the market in terms of price and quality. The fragrances, wines and spirits, automobile, jewelry and watches, clothing and accessory apparel, cosmetics, and travel goods which have been on an upward market-value climb for many years are comprised in the luxury goods market.
Luxury goods offer superior comfort, charm and elegance and are therefore greatly desired by consumers and individuals as they are also known to raise the social status and self-worth of people who own them.
The global luxury goods market is expected to grow at a CAGR of around 5.2% over the next 5 years.
MARKET DRIVERS:
The growth of this market is attributed towards major pertaining factors including; the bolstering consumer preference towards various luxury products due to the improving standards of living of people across different regions around the globe, the growing number of high-net-worth individuals across the globe, the increasing disposable income of individuals, the surging overall expenditure on luxury goods, the rising awareness about social status among individuals across the globe and the growing inclination towards the purchase of premium quality luxury products due to their uniqueness in design etc.
Additionally, with growing digitalization and increasing penetration of smartphones and e-commerce facilitating easy purchase option of products produced at distant places for consumers, the players in the luxury goods market are adopting creative measures to increase their online presence for boosting their sales. The emergence of online stores, product advertisement through social media, and engagement with existing and prospective consumers by the adoption of the Luxury 4.0 model which digitalizes the consumer’s entire luxury shopping journey with the use of technologies such as AI, (VR/AR) is enhancing the demand and sale of luxury items for the market players. Conversely, brands already having an online presence are now robustly focusing on opening physical stores to increase traffic to their e-commerce stores and for enhancing brand legitimacy. This increasing adoption of measures by different class of market players in different segments is contributing immensely in fueling the growth of the overall luxury goods market.
Moreover, the luxury goods manufacturers are looking to enhance their research and development activities to emphasize and plan on drawing the attention of the new emerging class of consumers popularly called as High-Earners-Not–Rich-Yet (HENRY) class. Along with drawing attention of these new emerging classes, the market players are also investing substantial amount of funds for creating new and unique innovative items that resonate with the needs of the younger section of the population, who make up the future consumers of luxury goods.
Furthermore, other factors such as the proliferating awareness about personal appearance across regions, the augmenting demand for premium cosmetics and beauty products, the vastly booming international tourism sector, the rapidly growing consideration of social impact of luxury purchase among millennials and Generation Z and the thriving number of sustainable initiatives and ESG from luxury businesses as a result of the burgeoning pressure from governments and NGO’s further propel the growth of the luxury goods market.
However, factors such as the growing number of counterfeit products in the market, the growing economic turbulence in several countries across the globe, currency depreciation and the inability of the players operating in the market to correctly predict the rapidly shifting consumer preferences hinder the growth of the luxury goods market.
LUXURY GOODS MARKET SEGMENTATION:
By Product Type:
- Apparels and Leather Goods
- Jewelry and Watches
- Cosmetics and Personal Care Products
- Champagne/Wine and Spirits
- High-End Furniture and Houseware
- Luxury Automobiles
- Other Luxury Goods
By End User:
- Female
- Male
By Distribution Channel:
- Single-Branded Stores
- Multi-Brand Stores
- Online Stores
- Other Channels
By Region:
- North America
- Europe
- Asia Pacific
- Latin America
- Middle East & Africa
REGIONAL INSIGHT:
The Asia Pacific region is the largest and the fastest growing luxury goods market in terms of region. The region is further expected to continue with the same trend in the upcoming years owing to factors such as the rapidly augmenting demand for luxury goods in the region, the increasing incomes of people in the region, the proliferating online sales of luxury goods in the region, the expanding number of boutique luxury brands in the region, the surging awareness and information among individuals regarding the luxury trends in the region and the Chinese government’s reduction in import duties and coupled with increasing brands’ efforts to curb the price gap with overseas markets in the region etc. The region was led by Mainland China with more than considerable contributions made from countries like India, Japan, South Korea and Australia.
The European region holds the second largest share in the luxury goods market which is further anticipated to witness massive growth in the following years as well. The growth in the region could be attributed to factors such as the presence of the highest number of leading luxury goods companies globally in the region, the increasing availability of luxury goods in the region, the rising spending on luxury goods by individuals in the region and the growing e-commerce industry in the region etc. The region was led by France with countries such as Germany, U.K, Spain and Italy also contributing significantly to the regional market.
The North American region holds a prominent share in the luxury goods market and is further projected to experience substantial growth in the forthcoming years on account of factors such as the increasing presence of several luxury goods companies in the region, the growing demand for luxury clothing accessories and glasses/sunglasses in the region, the proliferating disposable income and overall luxury spending by local consumers in the region and the growing presence of key market players in the region etc. The major contributors in the region include the U.S, Canada and Mexico.
FEW KEY PLAYERS IN LUXURY GOODS MARKET:
- The Estée Lauder Companies Inc.
- LVMH Moet Hennessy - Louis Vuitton
- PVH Corporation
- Cie Financiere Richemont SA
- L’Oréal S.A.
- Kering S.A.
- Prada S.p.A.
- Benetton Group Srl
- Bulgari SpA
- Burberry Group PLC
- Coach Inc.
- Diesel SpA
- Dolce & Gabbana Srl
- G-III Apparel Group Ltd.
- Giorgio Armani SpA
- Guccio Gucci SpA
- Guerlain SA
- Hermes International SA
- Luxottica
- Ralph Lauren
- Breitling
- Elizabeth Arden Inc.
- Salvatore Ferragamo SpA
- Shiseido Co. Ltd.
- Tiffany & Co.
- VF Corporation
- Rolex SA
- Christian Dior
- Chanel
- Other Players
RECENT DEVELOPMENTS:
- In April 2021, French luxury giant Louis Vuitton partnered with JD.com to further its e-commerce reach in the China market. JD.com, is looking to get creative in its efforts to attract luxury partners and is working out a model in which customers that type “LV” into the JD app search bar are redirected to Louis Vuitton’s official WeChat mini-programme where a full range of the brand’s products are available for purchase.
- In April 2021, Luxury fashion labels Louis Vuitton, Cartier, and Prada came together to form the Aura Blockchain Consortium to provide the customers a blockchain-backed seal of authenticity for their products.
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- Publication date: 16th April 2023
- Base year: 2022
- Forecast year: 2023-2033
- Format: PDF, PPT,Word,Excel
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