The COVID-19 pandemic, the cost-of-living crisis and high inflation continue to have a substantial impact on affluent populations, their wealth and their spending habits on luxury goods. The top wealth segments stand out now more than ever before, and remain the key consumers and drivers of luxury goods. This report provides a top-line overview of market performance across the major competitors, and outlines key trends within the global luxury goods business landscape.
This report comes in PPT.
The global luxury goods industry continued on its road to recovery in 2023, with just under 3% year-on-year growth, driven by Asia Pacific and the US. However, challenges persist, thanks to slower global growth and high inflation, coupled with ongoing energy pressures, rising cost of capital, tight labour markets, geopolitical risks and a reset of globalisation.
Emerging markets are increasingly a focal point for industry expansion, driven by growing populations and increasing wealth. Luxury brands are strategically targeting these markets to tap into new consumer bases, adapt products to diverse cultural preferences and capitalise on the untapped potential for significant growth in regions such as Latin America.
Becoming a purpose-driven luxury brand or company that recognises the importance of bringing value beyond profits has become increasingly important to appeal to high-income consumers and avoid collateral damage. In a crowded marketplace, a growing number of consumers are turning to brands that align with their values.
Wealthy consumers are increasingly regarding luxury goods as long-term investments in themselves, prioritising the pursuit of richer and more authentic experiences for a fuller life. This is giving further opportunity for luxury brands to side-step into this area by venturing into branded cafés, restaurants, food and wine pop-ups, as well as luxury hotels, spas and wellness.
As more consumers adopt Gen AI applications, luxury businesses will find more use cases to optimise design processes and enhance creativity. Gen AI also has the potential to reshape the industry towards a more sustainable future, from creating virtual prototypes to predicting consumer preferences and fostering innovation throughout the entire value chain.
This is an aggregation of: Personal Luxury, Fine Wines/Champagne and Spirits, Luxury Cars and Experiential Luxury.
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