Global luxury goods sales will rise by 6-7% this year to break through the EUR200bn (US$255bn) barrier, according to a new study.
Business advisor Bain & Company expects annual sales increases of 7-9% a year until the middle of the decade, it said in the spring 2012 update to its Luxury Goods Worldwide Market Study.
Highlighting a continuation of the trends that created sharp recovery from the 2008-9 recession, including the growth of online sales, rapid expansion in China and a shift from wholesale to direct-owned retail, the report predicts growth of 2-4% growth in 2012 for Europe, 5-7% in the Americas and 2% in Japan.
Combined, these will deliver the highest sales in absolute terms, it said.
Meanwhile, China is projected to grow sales by 18-20%, alongside resumed increases in India and Russia, plus new markets including Azerbaijan, Brazil, Indonesia, Kazakhstan, Malaysia, Mexico, South Africa, Turkey and Vietnam.
Among a number of key factors identified in the report is the fast-growing dominance of Chinese consumers, including tourists, who now account for over 20% of global luxury sales, while Asian consumers as a whole account for more than 50%.
Thirty percent of global luxury sales now occur within emerging markets, the report adds, and while the average age of Asian luxury goods consumers is steadily falling, it’s moving up in Europe, Japan and the US.
“Brands must develop strategies with much wider reach than ever before,” said Claudia D’Arpizio, a Bain partner in Milan and lead author of the study.
“The lessons they learned in earlier emerging markets will help, but they now must manage even broader diversity of consumer preferences, and more variations in their model of how to take products to market.”
APA