The global luxury goods market has performed well in recent years, which has presented exciting opportunities for luxury brands. This case study explores the biggest trends which are currently impacting the market and identifies the key ways in which brands are utilizing these trends to drive growth. The study also takes a look at some of the growing threats and challenges which lie ahead for players within the market.
Despite a slowdown in economic growth in multiple markets, the global luxury goods market has remained in healthy growth in recent years. Chinese buyers are now one of the most important groups in the global luxury market, in fact the Asia Pacific region as a whole is the fastest growing market globally and will play an increasingly important role in the coming years. A number of brands have reported positive results in 2017-2018 and as a result of this there has been a period of significant merger and acquisition activity, with a number of high value deals taking place.
As a new generation of consumers comes to fore, a number of trends have swept across the global luxury goods market. Millennial and Generation Z consumers are becoming increasingly affluent and attracting this demographic is the key to ensuring current and future growth for luxury brands, however these consumers have completely differing demands and bridging the gap between old and new is both a challenge and opportunity.
There is a growing demand for sustainable luxury amongst consumers, and now more than ever, social media and omni-channel retailing is a key way for companies to drive sales. Despite the luxury goods market having a positive outlook globally, there are a number of threats and challenges which lie ahead for companies. Counterfeiting is becoming increasingly sophisticated which has led to the rise of ‘super fakes’, this alongside the growth of online retail is presenting a new challenge for companies, as products are unknowingly being bought as fakes. The negative implications of the overreliance on Chinese consumers will also become evident in the coming years, as spending decelerates both at home and abroad as the country’s economy begins to slow.
For further reading please see our casestudy on the luxury goods market found here: https://new.marketline.com/Analysis/ViewasPDF/luxury-goods-the-biggest-trends-currently-shaping-the-market-80482