Luxury goods sales growth for the year ended March 2022 for Richemont was 50.1%. With 2022 already knocking on our doors, its time to step into another year full of new and interesting trends, figures and actions for the Luxury Goods market. The luxury goods sales of the top two companies in FY2021 was more than the total luxury goods sales of the Top 5 in FY2016. India Private Equity Report 2023. Luxury cars, luxury hospitality, and personal luxury goods together account for 80% of the total market. Ongoing Covid-19 restrictions and economic uncertainty caused the first personal luxury market decline in five years. Despite the uneven recovery in personal luxury goods, it is projected to post CAGR between 6% to 8% and reach sales of 360 to 380 billion ( $409 to $432 billion) by 2025. MA Omnichannel retailing and a major shift in passenger mix are poised to transform traditional airport shopping. The prospects for personal luxury goods out to 2030 are positive. Chart 2: Luxury goods sales YoY growth FY2019-FY2021. Recognizable brand signifiers (whether a shape, a piece of metalware, a material, or a monogram) remained popular. Fashion jewelry showed solid growth. The high-end furniture and housewares market reached 53 billion, up 13% from 2021. The luxury markets consumer base will expand from some 400 million people in 2022 to 500 million by 2030. In general, luxury brands have the chance to secure common prosperity, but they will need to challenge and adapt their strategy. All luxury categories have now recovered to 2019 levels or better, with hard luxury, leather and apparel leading the resurgence following the pandemic. Please read and agree to the Privacy Policy. Our 11th annual report looks at the pandemics effects, the industrys impressive recovery, and the possibilities ahead. Travel retail is in recovery mode, at least in Western markets, but not yet back on its pre-Covid track. The pandemic was the catalyst for change as luxury goods companies adopted new paradigms of value creation. It seems that traditional market segmentation lost its relevance. Lighting and living/bedroom categories benefited the most, as consumers looked for more comfort, functionality, and beauty. The fine art market grew 13% to 39 billion, as the ranks of potential buyers swelled and new Asian art hubs strengthened. Air Travel Forecast to 2030: The Recovery and the - Bain & Company The Russian market was mostly inactive due to war-related suspension of operations. As a result, Bain-Altagamma analysis sets out two scenarios, with sales growth in the personal luxury goods market set to be between 3 to 5% or 6 to 8% (at constant exchange rates), depending on the strength of economic recovery in China and the ability of the US and Europe to withstand economic headwinds. Report. Bain: China's Luxury Market Contracted 10 Percent in 2022 The consultancy firm expects growth in the sector to resume in 2023, with sales returning to the 2021 level as soon as the first. The companies making up the Top 5 have been relatively stable, with only LOral Luxe entering the Top 5, replacing Richemont*, Chart 1: Luxury goods sales US$ million: FY2016 & FY2021. In the United States, traditional luxury hubs gradually returned to growth while suburban areas retained their new prominence as a source of luxury sales. Worst dip in history for the personal luxury goods market: Personal luxury goods are items like jewelry, luggage, haute couture clothing, sports cars and more. Major technology growth companies shed 140,000 employees in 2022, followed by a second wave of layoffs in the first weeks of 2023. Although there will never be "another China" in terms of growth' contribution to the industry, India and emerging Southeast Asian and African countries have a significant potential nevertheless. Photo: Shutterstock Around 21 per cent of global consumer spending on luxury goods in 2021. While Bain doesnt predict where wholesale and retail will end up by 2025, its pretty certain that the twenty-year trend away from wholesale will continue. The pandemic-fueled interest in consuming gourmet food at home continued, boosting select food retailers and fostering demand for culinary education. Even in the face of recessionary conditions expected across leading economies into 2023, the Bain and Altagamma analysis forecasts further expansion in sales and market value for luxury goods through the coming year and decade. The New ROI: Defy Uncertainty by Boosting Return on Innovation | Bain Your email address will not be published. About Bain & Company Bain & Company is a global consultancy that helps the world's most ambitious change makers define the future. The surging recovery Bain speaks about only applies to the power brands. The makeup and fragrances categories led growth. Spirits driving maret recovery thanks to growth in local consumers interest for Asian spirits, increasing interest for status spirits and better ability vs ine brands in catering interest of younger generations. In contrast, Mainland China lost a little ground, dropping 1% from 2021. After a severe contraction in 2020 due to the Covid-19 pandemic, the market grew back to 1.15 trillion in 2021 and surprised everyone in 2022 by further growing 19%21%, according to our estimates. All categories have now recovered to 2019 levels or better, with hard luxury, leather goods, and apparel leading the resurgence following the pandemic. Internationally, secondhand growth was aided by sustained demand for watches, which account for 60%70% of the total market. Consumption was very strong in Europe. Increasing market concentration, yet with high dynamism from rising stars. 'Gen Y' and 'Gen Z' accounted for the entire growth of the market in 2022, it notes. Monobrand stores were boosted by the willingness of customers to return to in-person shopping. From insights to the performance of the market, through estimates for the approaching us 2022, all the way up to some key recommendations this study contains data no one from the Luxury Goods industry should overlook. Shoes grew by 20%22% compared with 2021 to reach 28 billion. The economic model will continue to evolve. 1 Richemonts FY2021 financial year ended in March 2021, so saw a greater negative impact of the COVID-19 pandemic on their FY2021 results compared with other Top 5 companies which had later year end dates. 2020-21 is the turning point for establishing the keyword for the next 20 years of luxury. Opinions expressed by Forbes Contributors are their own. Although there will never be another China in terms of outsize growth contribution to the industry, India and emerging Southeast Asian and African countries have significant potential, if the luxury industrys infrastructure (such as malls) and regulation can evolve quickly enough in those markets. Luxury Market Rebounds In 2021, Set To Return To Historic Growth Trajectory Chinese customers will be back by 2022-23, Japan by 2023 and Europe in 2024. In 2022, the luxury market generated positive growth for 95% of brands. Retail continued to grow faster than wholesale and reached parity in terms of market share. As 2022 draws to a nervy close, the market is headed for a 22% year-over-year increase. Sales of new watches grew by 22%24% and reached a record 52 billion, reflecting solid demand for top-of-the-range models and iconic pieces, but growth was capped by low product availability. Mainland China should overcome the Americas and Europe to become the biggest luxury market globally (25%27% of global purchases). China's luxury market shrank 10% in 2022 -Bain | Reuters Young and affluent Chinese Gen Z consumers find local brands much more aspirational and desirable than millennials or Gen Xers, he wrote, as he observes the native Gen Z consumers are exceptionally proud of their Chinese culture heritage and its future potential. "The nouvelle vague thenew wave of the luxury goods market will demand evolution amid disruption, adaptation amid uncertainty, and an expansion of creativity in all of the basics all while new trends and concepts develop",said Claudia D'Arpizio, a Bain & Company partner and leader of Bain's Global Luxury Goods and Fashion practice, the lead author of the study. The estimated value for the whole market in 2021 is B 1.140. Global Retail, Wholesale & Distribution Sector Leader, Managing Director | Deloitte Consulting LLP. Stay ahead in a rapidly changing world. This market growth is driven by factors that go beyond aspiration, with consumers becoming more knowledgeable and choosy, and intensified competition for loyalty and advocacy. BEIJING, Feb 7 (Reuters) - China's luxury market contracted 10% in 2022 on the year, snapping a five-year streak of high growth, as Beijing's zero-COVID policy and a slowing economy hit. Overall, we estimate that in 2022 the luxury markets overall retail sales value grew by 19%21% to 1.38 trillion, or 8%10% above 2019 levels. Read More USD 1,325 Add To Cart Luxury yacht orders rose to a record level, amid solid growth in deliveries. All of the Top 5 companies saw their luxury goods sales rebound in FY2021, as the impact of the COVID-19 pandemic on consumer demand, retail and supply chain constraints reduced. Across 64 cities in 39 countries, we work alongside our clients as one team with a shared ambition to achieve extraordinary results, outperform the competition, and redefine industries. Some tourists bounce back over the summer. Strong market share shift towards European brands. India stands out; its luxury market could expand to 3.5 times todays size by 2030, propelled by younger customers and an expanding upper and middle class. This is a BETA experience. Yet, they still require an infrastructure catch-up to facilitate the expansion locally. Now distribution is split virtually down the middle, half through wholesale and half through retail. For any questions or to arrange an interview, please contact: Gary Duncan (London) Email: [emailprotected], Orsola Randi (Milan) Email: [emailprotected]Tel: +39 339 327 3672. Commenting on the critical trends and themes for the luxury industry up to 2030, Federica Levato, partner at Bain & Company and leader of the firm's EMEA Luxury Goods and Fashion practice, co-author of today's report, said: "In their path to 2030, luxury brands will need to leverage their cultural avant-garde position and insurgent excellence to overcome the challenges ahead and shape the world. Shoes, leather, jewelry, watches, beauty and apparel these categories can expect changes, with the highest growth between 2019 and 2021 being the shoes category. International travel disruptions, duty-free opportunities, and digitalization continue to strengthen domestic spending in 2021. That ratio has come down from 3.4 times in 2018. Uber-luxury jewelry outperformed globally, as did iconic pieces and lines. The full report, which will be published in late 2022, will include a full analysis of the Top 100 companies, as well as luxury trends and special focus sections. Heinemann Outperforms Travel Retail Rivals With 81% Growth To $4.2 Billion In 2022, Airport Retail Confectionery Firsts From Oreo And Lindt, Both With Live Chefs, Consumer Demand Is Slowing, Good For Government Policy Wonks, Bad For Retailers, An Exclusive Retail Service Experience Is At The Center Of CB2's New Design Shop, Whats Working - And Not - In Mobile Commerce (Part 1 Of 2), Magna reports global digital media grew by nearly one-third year-over- year in 2021, China can be a risky bet for Western luxury brands, Chinese Gen Z consumers find local brands. The nouvelle vague the new wave of the luxury goods market will demand evolution amid disruption, adaptation amid uncertainty, and an expansion of creativity in all of the basics all while new trends and concepts develop, said Claudia DArpizio, a Bain & Company partner and leader of Bains Global Luxury Goods and Fashion practice, the lead author of the study. Now, brands are multi-price points to answer to different customer needs. Prospects for personal luxury goods market out to 2030 are also highly positive, today's analysis concludes. Younger generations (Generations Y, Z, and Alpha) will become the biggest buyers of luxury by far, representing 80% of global purchases. Global Wealth and Luxury Report 2022 - Euromonitor The global luxury goods industry overall is projected to achieve a market value of some 1.4 trillion in sales revenue this year, growing by 21%from 2021 (at current exchange rates), according to the latest Bain & Company report with Altagamma, the Italian luxury goods manufacturers' industry association. This article is a preview of the Top 5 companies listed in the upcoming Global Powers of Luxury Goods 2022, which will be published in late 2022. The apparel category grew by 22%24% in 2022, aided by wardrobe restocking. Sales of luxury cars, the biggest portion of the overall market, hit a new record, reaching an estimated 566 billion, 6% more than 2021 at current exchange rates and 3% above 2019. Already it is about half the size of each of the three leading personal luxury goods categories leather accessories, beauty and apparel and its 27% growth from 2019 leaves every other personal luxury goods category in the dust. The personal luxury goods market reached an estimated 113 billion in the Americas, growing 25% over 2021. In 2022, the luxury market generated positive growth for 95% of brands. What other changes can we expect looking at consumers age? Luxury brands have faced three years of tremendous turbulence and uncertainty, but the industry shows more strength, resilience, and ability to innovate than before. Over the past twenty years, wholesales share of the market dropped by 72% in 2010 to 51% in 2021, with the biggest drop from 2019 when it declined from 60%. Please read and agree to the Privacy Policy. South-east Asia and Korea are winning in terms of growth and potential. We observed a rebound when and where Covid restrictions were lifted, yet not enough to offset the performance of the second quarter. This is, in part, driven by a more precocious attitude towards luxury, with Gen Z consumers starting to buy luxury items some 3 to 5 years earlier than Millennials (at 15 years-old, versus at 18-20), and Gen Alpha expected to behave in a similar way. PARIS The luxury industry has shown resilience with a return to pre-COVID performance levels and an estimated sector growth of more than 6% between 2022 and 2026. Iconic models and new hero products were the most desirable items. The other five key trends identified in the report are: Old continents are still leading, but new markets are surprising. The analysis notes that, even with a possible global recession next year, the impact on the industry could be different from that of the 2008-2009 global financial crisis. The coming years will see a further blurring of the boundaries between mono-brand and ecommerce, which will increasingly push brands to take an Omnichannel 3.0 approach, enabled and enhanced by new technologies. What Sadove sees shifting in distribution is a move toward more concession models in retail from traditional wholesale-to-retail distribution. Local consumptions are strong everywhere. It finds that solid market fundamentals and new tech-enabled profit pools, are set to boost the markets value to 540-580 billion by the end of the present decade, from 353 billion estimated for 2022 a rise of 60% or more. Monobrand websites gained further ground, raising their share to about 45% of the online segment, up from 43% in 2021. We work with ambitious leaders who want to define the future, not hide from it. The US luxury market proved very strong in 2022. Find info on Construction companies in Cottenchy, including financial statements, sales and marketing contacts, top competitors, and firmographic insights. South Korea back to 2019 levels: full repatriation of local customers over-compensate for the lack of tourism. The secondhand luxury goods market rose to 43 billion in 2022. *I have read thePrivacy Policyand agree to its terms. Struggling Australia which only recently reopened after months of lockdown. China to be world's No 1 luxury market by 2025, Bain & Co forecasts Jewelry sales in 2022 are estimated to have risen to 28 billion, up 23%25% from 2021. However, the spots will be replaced by new consumers, mostly Generation Y and Z. What will it bring? Driven by the dichotomic impact of pandemic outbreak in 2020, the luxury food market is showing significant difference in growth rates within its components. Meanwhile, the online channels market share is normalizing. (Photo by Hollie Adams/Getty Images), Cinco De Mayo Is Only One Day, Yet Latino Consumers Deserve Attention All Year, Retail Alert: Philippines May Talk Trade As President Marcos Arrives In The USA, Gebr. A report by Bain & Company reveals China is set to become world's largest luxury market by 2025. We therefore forecast that the market value of personal luxury goods will rise to between 540 billion and 580 billion by the end of the present decade, from an estimated 353 billion in 2022an increase of more than 50%. While he believes that Chinese luxury brands will not suddenly replace aspiration for Western luxury brands, he cautioned, There are clear signs that a fundamental shift is happening, and like so many disruptions in the luxury space it is being driven by Gen Z.. Bain & Company recently released its 20 th annual Luxury Study, which underlines the resurgence in the global luxury market in 2021 after a contraction in 2020. But the Global State of the Consumer Tracker makes it easy for you to access consistent, high-quality data on consumer sentiment and behavior in retail, consumer products, automotive, and travel. Fashion ranking: Top 20 clothing retailers in Germany. Between 2021 and 2022, about 70% of leather category growth has been driven by price increases; by contrast, price increases accounted for only about 50% of category growth from 2019 to 2021. Luxury cars are still subject to supply chain disruption, with component shortages further heightened by the Russia-Ukraine war. The experiences sector, including travel and any in-person brand experiences, is still way below its pre-covid levels, mostly because of travel restrictions. This is, in part, driven by a more precocious attitude towards luxury, with Gen Z consumers starting to buy luxury items some 3 to 5 years earlier than Millennials (at 15 years-old, versus at 18-20), and Gen Alpha expected to behave in a similar way. This trend has also been reflected in product categories, through the shift to the 'post-streetwear' era, which maintains some elements of so-called streetwear (such as gender fluidity, occasion-less apparel, inclusivity and sports-driven inspiration) but goes beyond its style codes through new and enhanced techniques, materials and functionalities. Luxury spending trends in 2022 The overall luxury market tracked by Bain & Company comprises nine segments: luxury cars, personal luxury goods, luxury hospitality, fine wines and spirits, gourmet food and fine dining, high-end furniture and housewares, fine art, private jets and yachts, and luxury cruises. In 2022, we estimate that 95% of brands experienced positive growth, but most luxury players continued to invest for the future, which resulted in a slight erosion of average profitability following an unprecedented increase in 2021. Among the rising stars, India stands out for growth potential, which could see its luxury market expand to 3.5 times todays size by 2030, propelled by an increasing interest and evolving attitudes and behaviors among (young) customers towards luxury goods.
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