While demand for bags and luggage in Malaysia is expected to improve over 2021 following the significant declines of 2020 as a result of the pandemic-induced lockdown and limited travel opportunities, the first half of the year has continued to be plagued by further repercussions of spikes in cases of the virus. This has resulted in further closures of non-essential stores, as well as impacting the return to offices and schools, resulting in fluctuating demand for backpacks and business bags.
While current value growth is set to improve over 2021, overall value sales levels will be lower compared to pre-pandemic levels due to ongoing deep discounting strategies, resulting in another decline in the average unit price as players and retailers attempt to move product. This is resulting in stronger retail volume growth in comparison, with discounting most evident on non-luxury and entry-level luxury brands.
The competitive landscape of bags and luggage is highly fragmented in Malaysia with LVMH Moët Hennessy Louis Vuitton and other luxury international houses, which offer multiple luxury brands, continuing to lead the field in retail value share terms. However, apart from LVMH Moët Hennessy Louis Vuitton which gained value share in 2020, all other competitors held single-digit share, while the category is dominated by smaller players under “others”.
Various marketing activities including discounting are expected to continue to be a key competitive strategy amongst players moving into the forecast period, which will be crucial for non-luxury brands, while less so for entry-level luxury brands as consumers’ confidence gradually returns. For instance, Braun Buffel which offers a wide range of bags on its e-commerce site, runs limited time discount periods including for specific events such as Father’s Day in an attempt to drive up demand.
Sustainability offers a key opportunity for bags and luggage players to further develop over the forecast period, with an increasing number of brands focusing on the eco credentials of their products through effective marketing, an issue which particularly resonates with younger consumers and millennials who are interested in the environment. In addition to newer launches by Samsonite using recycled PET bottles, Nike which has a presence in the athleisure segment with its backpacks and duffel bags, is also emphasising its use of sustainable materials including the Nike Utility Gymsack, and Nike One training tote bags with the latter targeting active female consumers.
Department stores and bags and luggage specialist retailers are predicted to continue to dominate sales of bags and luggage over the forecast period, with many consumers preferring to physically inspect goods, particularly high-end or bulky luggage, prior to purchase in addition to enjoying the personal attention of sales assistants. Traditionally, they have been hesitant to purchase luxury goods online due to concerns over authenticity, although the development by leading player LVMH Moët Hennessy Louis Vuitton of its own Louis Vuitton e-commerce platform in Malaysia and Singapore is likely to have helped allay those fears.
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Understand the latest market trends and future growth opportunities for the Bags and Luggage industry in Malaysia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
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This report originates from Passport, our Bags and Luggage research and analysis database.
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