Far from stopping its growth, the luxury market continued its expansion during the pandemic, both in the world and in Argentina. Despite the economic recessionproducts that offer exclusive experiences, hard to come by and reserved for a few, such as sumptuous watches, are at their best.
Ten years ago, it was estimated that there were 10 million billionaires globally. Today, there are believed to be 100 million. Only in 2020, the year of the Covid-19 outbreak, 5.2 million new billionaires joinedaccording to the latest estimates of the sector.
In addition to a growing demand, there is an extension of the offer. Although this consumer segment always existed, the professionalization of business was perfected, along with increased research and development of production, giving rise to new players specialized in different areas.
In an economic and financial context of great volatility, the scarcity of these articles, already raised as a conceptual condition since their manufacture, is an attribute that generates increasing interest, for which the public considers them an attractive investment and a haven of value, taking into account their standards of quality and the limited quantities that are accessed. Is about a part of the population that values luxury and acquire, for example, high-end watches as a form of hoarding.
Recents auction house auctions number one in the world evidence the phenomenon, with the increasing participation of people who pay for the sophisticated pieces amounts higher than the original ones.
In the Argentinarestrictions on international travel and the currency gap caused an increase in demand, which is currently maintained, given the possibility of accessing convenient prices, without having to move to another country to buy the desired objects.
Added to the benefits that the brands themselves promote, it is an advantageous option. The Argentines they still choose to shop locallyeven at a time when people returned to travel abroad, after the relaxation of measures to contain the advance of the coronavirus.
Historically, the typical consumer profile was those who were passionate about Luxury articles and collectors. Today, the public extended beyond the fans. The age range was expanded and young people aged 30 and over are turning to buy products with these characteristics.
It also contributes to the growth of the industry, the reactivation of social life, with the resumption of recreational events, which demand is fired. Another factor that influences this boom is the arrival of international tourists to Argentina, after the reopening of borders, willing to consume these items, benefiting from the exchange rate.
The industry showed that Crisis times they also generate opportunities, if you have the waist to understand the needs of consumers and adapt to the changes required by the context. Understanding the various cycles that the region and Argentina go through is key to growing the market.
As long as society attributes an increasing value to products, luxury consumption will grow even more. The perspectives anticipate a promising future, beyond the ups and downs and the instability that a country like ours can suffer.
The fact that it is a globalized industry means that it is not conditioned to the cyclical variations of the national economy. It can be a limiting factor in development, but it does not become a decisive factor.
However, work must continue to boost competitiveness of the sector, an aspect on which we focus at the Argentine Swiss Chamber of Commerce. There is an old trade relationship between Argentina and Switzerland. Several Swiss companies have a long history in the country.
We are in permanent contact with the Ministry of Productive Development, the Ministry of Economy and other government actors, with whom we seek to generate consensus and optimize different issues related to foreign trade. It would be helpful if the link could be systematized to help stimulate the commercial flow between both nations, in order to promote this industry that has no borders.
By Ernest Kohen
President of the Argentine Swiss Chamber of Commerce and President of Grupo Chronex.
Representative in the country of the watch brands Omega, Piaget and Raymond Weil.
by Ernest Kohen
