Global Luxury Goods Market- Current Fashion Trend and for Maintaining High Status in Society: Infinium Global Research

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Mar 13, 2020, 08:45 ET

PUNE, India, March 13, 2020 /PRNewswire/ -- The luxury goods industry is well established worldwide but these are largely present in Italy and around the region in Europe. A recent report published by Infinium Global research on "Luxury Goods Market (Product Type - Designer Apparel & Footwear, Jewelry, Accessories, Cosmetics & Beauty Products, Fine Wines/Champagne & Spirits, Travel Goods; Mode of Sale - Retail and Online): Global Industry Analysis, Trends, Size, Share and Forecasts to 2024". Estimated the market for global luxury goods market will reach up to 324.5 billion by 2025, with a Compound annual growth rate of 2.92%, in the forecast period (2019-2025).

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Tourism drives the sales of luxury goods. Traveler's account for one-third of global sales of luxury goods. Tourists tend to buy luxury goods from abroad. There is prestige attached to buying luxury goods from fashionable cities including Los Angeles, London, Paris, New York, Singapore, Milan, and Dubai, among others.

Tourism Drives the Sales of Luxury Goods Augments the Growth of the Market

Travelers account for one-third of global sales of luxury goods. Tourists tend to buy luxury goods from abroad. There is prestige attached to buying luxury goods from fashionable cities including Los Angeles, London, Paris, New York, Singapore, Milan, and Dubai, among others. In Europe, travelers account for a substantial percentage of sales of luxury goods.

The traveling luxury goods customers value the tradition and heritage of brands in France, the United Kingdom, Italy, and Spain among the European countries. Many affluent travelers from developing countries visit developed countries to buy their favorite brands. The rich people from the latest emerging or developing economies tend to buy luxury goods from abroad to showcase their prestige in their society. The slowdown in the Chinese economy did impact the percentage of Chinese visitors to the western countries in recent years.

However, there is a surge in Chinese travelers during 2018. Rich students from emerging economies tend to splash the cash to buy luxury goods in the countries where they study. Many of the students from emerging economies work in western host countries and they can afford to buy luxury goods. In Australia, Asian travelers and students accounted for a significant percentage of luxury goods sales.

As a significant percentage of the population in GCC countries are expatriates from other countries, they form a part of the customer base. Moreover, a lot of travelers visit GCC countries. Events like the Dubai shopping festival attracts a huge number of tourists. Affluent Tourists tend to buy luxury goods during their visits. Affluent Russians and Brazilians tend to travel to western countries and a significant percentage of them buy luxury goods from abroad.

Rise in the Number of High Nets Worth Individuals' and Changing Lifestyles Likely to Boost the Luxury Goods Demand

The number of high net worth individuals is increasing in the USA, China, UK, Hong Kong, and some other emerging economies. Economic prosperity in emerging economies in Asia, Latin America, Middle East, and Africa reflects in the rise in high net worth individuals as well. The neo-rich people in developing countries tend to buy luxury goods to show off their newly acquired status in their society. Their aspiration to experience the luxury of brands they dreamed to afford increases the consumption of luxury goods.

Many high net worth individuals migrate to developed countries to have better business prospects or lifestyle. The changing aspirations among youth such as millennials and generation X are evident in this era. In many countries, where there is significant economic growth, the disposable income of the youth is increasing relatively. Unlike the old generation that preferred cost-effective products, current youth are far more brand conscious. The change in corporate culture also helps the consumption of luxury goods.

Some companies provide their employee's opportunities to experience the luxury products and services to keep them content. The advertising campaigns of top luxury brands in associations with top creative minds leave a lasting influence on potential customers in terms of aspiration. Rebranding of in-house retail outlets has helped some luxury brands to win over millennial customers. Major brands are bringing affordable luxury brands to cater to the needs of the upper-middle-class population.

Rising Counterfeiting Affects Sales and Brand Value Can Hinder the Growth of the Market

Counterfeiting affects the market global luxury goods in a big way. According to the global brand counterfeiting report, the losses incurred by major brands were nearly USD 323 billion. Luxury goods brands incurred loss worth nearly 30 billion due to online sales. Counterfeiting affects the brand value of luxury goods manufacturers. Fake websites similar to the branded ones draw unsuspecting consumers who look to buy branded luxury goods online.

Likewise, those who wish to purchase luxury goods online may end up buying at e-commerce websites with fake listings. Counterfeit products make it affordable for those who cannot afford the brands otherwise. Those who are loyal to brands may refrain from counterfeit brands. However, those who could afford a segment within luxury goods and have the aspiration for top end products may find counterfeit lucrative.

On the other hand, those who willingly buy counterfeit consumer goods do not bother about the legal repercussions, as they cannot afford luxury goods in the first place. The presence of counterfeit luxury goods in a huge number in a society eliminates the element of exclusivity among the affluent customers. The visibility of luxury goods everywhere can reduce its differentiation with other mass-produced products, indents the brand value.

Ease of Availability of Luxury Goods Through E-Commerce Provides a Better Opportunity for Market Expansion.

Earlier luxury brand manufacturing companies were resistant to selling online, fearful that the internet's mass access would damage luxury brands' exclusivity. However, with growing digitalization, the luxury goods companies are developing their own platforms to sell their products online. For this, these companies are either collaborating with multi-brand sites or developing their own platforms or both. Companies are going online to communicate their new product along with its dynamic features. Besides, video and teaser of the products on the website increases the desire to buy the product.

Also having an online presence can help companies to generate traffic on their website through promotional advertisements. Companies are willing to sell their products through e-commerce as selling their products through their own portal can avoid counterfeiting and can also sell their products directly to the end-user. Going further online selling of products reduces the operational cost of operating a store, which in turn, increases the profitability of the company. Besides this, with online portals luxury brands can track consumer behavior and accordingly place and market this product in the near term, to increase the sales of the products.

Travel Goods are Expected to Register Higher CAGR in the Forecast Period.

Based on product type, the sub-markets include designer wear & footwear, jewelry, accessories, travel goods, fine wine/champagne and spirits, cosmetics, and others. Based on gender, the sub-markets include males and females. Based on the mode of sale, the sub-markets include retail, and online.

The Asia Pacific the Region is Expected to Exhibit Fastest Growth Rate in the Forecast Period

Based on the region, the market is categorized into North America, Europe, Asia Pacific, and Row. Asia Pacific region is estimated to grow rapidly in the next few years on the back of Chinese and Indian economic development. Chinese spending on luxury goods exceeded the combined spending of their North American and Western European counterparts. According to Infinium global research study, China's Luxury good market shows that the majority of these young consumers are fresh to the market, presenting both a tantalizing opportunity and an implicit imperative for brands to stay current, or risk losing out to more digitally savvy rivals. China delivered more than half the global growth in luxury spending within 2012-18 and is expected to deliver 65 percent of the world's additional spending heading into 2025.

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Global Luxury Goods Industry Coverage

Preface

Report Description
Research Methods
Research Approaches

Executive Summary

Luxury Goods Market Highlights
Luxury Goods Market Projection
Luxury Goods Market Regional Highlights

Global Luxury Goods Market Overview

Introduction
Market Dynamics
Porter's Five Forces Analysis
IGR-Growth Matrix Analysis
Value chain Luxury Goods Market
Luxury Goods Market Macro Indicator Analysis

Global Luxury Goods Market by Product Type

Designer Apparel & Footwear
Jewelry
Accessories
Cosmetics & Beauty Products
Fine Wines/champagne & Spirits
Travel Goods
Others

Global Luxury Goods Market by Mode of Sale

Retail
Online

Global Luxury Goods Market by Region 2018-2024

North America
Europe
Asia-Pacific
RoW

Company Profiles and Competitive Landscape

The Estee Lauder Companies Inc.
Lvmh Group
Kering Sa
The Shiseido Company, Ltd.
Prada S.p.a.
Ralph Lauren Corporation
Swatch Group
Luxottica Group S.p.a
Compagnie Financire Richemont Sa

Appendix

Primary research findings and questionnaire

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About Us

Infinium Global Research is a business consulting and market research firm; a group of experts that caters to fulfilling business and market research needs of leading companies in various industry verticals and business segments. The company also serves government bodies, institutes and non-profit/non-government organizations to meet their knowledge and information needs.

Through our information services and solutions, we assist our clients to improve their performance and assess the market conditions to achieve their organizational goals. Our team of experts and analysts are engaged in continuously monitoring and assessing the market conditions to provide the knowledge support to our clients. To help our clients and to stay updated with the advances and inventions in technology, business processes, regulations and environment, Infinium often conducts regular meets with industry experts and opinion leaders. Our key opinion leaders are involved in monitoring and assessing the progress in the business environment, so as to offer the best opinion to our clients.

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