Growing demand in Asia is boosting the business of luxury goods and exclusive experiences. According to a study by management consultancy Bain & Company and the Italian luxury goods association Fondazione Altagamma, the global luxury market is expected to have grown by 8 to 10 percent this year to a record value of 1.5 trillion euros.
In particular, sales of luxury experiences such as exclusive cruises and hotels increased significantly, Bain announced on Tuesday. The demand for luxury cars has also increased significantly. Sales in the core segment of personal luxury goods – expensive clothing, shoes, perfume and jewelry – are expected to increase by 4 percent to 362 billion euros by the end of the year. However, there are signs of a slowdown in growth in this segment. A third of brands are expected to stagnate or shrink next year.
Tailwind for the industry continues to come from Asia. According to the study, demand grew by 9 percent in China, by 8 percent in Southeast Asia, and by as much as 17 percent in Japan. In Japan, “the luxury business is booming, driven by both loyal local customers and tourist inflows due to the weak yen.”
In Europe, sales from luxury tourism have almost returned to pre-pandemic levels. Bain and the Fondazione Altagamma expect the market for personal luxury goods to grow by 7 percent to 102 billion euros. In America, on the other hand, business is expected to decline by 8 percent to 101 billion euros. “The luxury customers there still have purchasing power, but have primarily continued to consume abroad, as the strong US dollar encourages purchases overseas due to price differences.” (dpa)