Global luxury growth is expected to accelerate further after 2023, with Bain forecasting a sales increase of 60 per cent from 2022 to 2030. The Russian market was mostly inactive due to war-related suspension of operations. While the industry has benefited from increased prices and a continued shift to higher-margin direct channels, the lower profit levels reflect luxury brands investment in future growth, particularly through increased marketing spending and ambitious transformation programs. Overall, the secondhand luxury market grew by 65% between 2017 and 2021, vs. 12% growth for firsthand items. That said, there is still a place for rising stars in the industry. These are the key findings from Bain & Company, the worlds leading advisor to the global luxury goods industry, in its Luxury 2022 Spring Update Rerouting the Future. The study was released today in collaboration with Fondazione Altagamma, the Italian luxury goods manufacturers industry foundation. the first half of 2022 growth path continues throughout the entire year. Mergers and acquisitions meant a wave of consolidation rippled through high-end galleries. Despite significant macro-economic challenges, including hyperinflation, slowing GDP growth and the Russia-Ukraine conflict, the personal luxury goods market proved resilient once again, said Claudia DArpizio, a Bain & Company partner and lead author of the study. The personal luxury goods market experienced remarkable performance in the first quarter of 2022, growing by 17-19%, at current exchange rates (13-15% at constant exchange rates), over the same period in 2021 for several reasons: The market could reach 360-380 billion by 2025. Stay ahead in a rapidly changing world. That said, there is still a place for rising stars in the industry. Monobrand websites gained further ground, raising their share to about 45% of the online segment, up from 43% in 2021. All luxury categories have now recovered to 2019 levels or better, with hard luxury, leather and apparel leading the resurgence following the pandemic. 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. A Brilliant Recovery Shapes Up: The Global Diamond Industry 2021-22. Those that come out ahead will take advantage of the opportunities presented by the virtual world, the sustainability transformation and preferences of younger generations.. Asian outperformance helped sales weather supply chain disruption. The retail channel has grown to the point that it now accounts for almost half the market (a forecast 49% in 2021) and is poised to overtake the wholesale channel. The global luxury market is enjoying strong momentum in 2022 so far, Bain & Company said, estimating that first-quarter sales rose 17 to 19 percent year on year. Brands continued to increase control over their distribution in 2021, with a rise of directly operated channels. Beauty recovered to 60 billion, just 1% below its 2019 levels. The rest of Asia is expected to return to growth, rising by 19% at current exchange rates to reach 32 billion. Womenswear grew faster than menswear, in large part due to the recent acceleration of occasionwear. Luxury's Growth Expected to Slow Dramatically Next Year, Bain Says Responding to the call of sustainability. The online channel's market share remained in line with 2021. Diversity, equity, and inclusivity climbed the agenda for fine arts management teams. The latest Bain-Altagamma Luxury Goods Worldwide Market Study forecasts increased resilience to recession after robust 2022 growth. This database, known as the Luxury Goods Worldwide Market Observatory, has become a leading and much-studied source in the international luxury goods industry. The goal of the. 1. Casual categories, such as fussbett sandals and Wellington boots, are on the rise. The performance of Hong Kong remained weak, while Taiwan and Macau faced more mixed results. Luxury markets are at an important inflection point after a record-setting 2021 and strong first half of 2022. Yet luxury brand players are continuing to invest in future growth, even in the face of high inflation and rising costs, so that their profitability is slightly decreasing, following an unprecedented increase in 2021. Bains insights are based on triangulating information and sources available as of November 10, 2022, including: The scenarios do not consider disruptive changes to the Covid-19 status quo (e.g., potential future waves of Covid-19 related to variations of the virus) nor to the global sociopolitical situation. The key mainland Chinese market was constrained by Covid-19 lockdowns. Globally, we see two likely scenarios in 2023, with personal luxury goods sales growth of 3%5% or 6%8% at constant exchange rates, depending on the strength of the Chinese recovery and the ability of the US and Europe to withstand economic headwinds. None of this has stopped brands from investing in modernizing their operations, especially through more robust information technology infrastructure to support the ongoing digitalization of the industry, and through a reconfiguration of their store networks (primarily through renovation and relocation projects). These are key findings from the 21st edition of the Bain & Company-Altagamma Luxury Study, a collaboration between Bain & Company and Fondazione Altagamma, the trade association of Italian luxury goods manufacturers. The apparel category grew in 2021, but not sufficiently to close the gap with 2019. Customization proved vital to accelerate the recovery. The crisis marks a turning point for luxury as we knew it. This helps streamline processes and clarify roles and responsibilities within an organization. Shoes, accessories, and jewelry were the product categories that advanced most during the pandemic. However, the countrys spending has been challenged by its strict Covid restrictions. We see that happening in 2024, but much depends on the resumption of international tourism and business travel. South Korea and Southeast Asia were stellar luxury markets, while the US and Europe enjoyed strong growth. and fall of DNVBs Download By ComCap Scope: Global Dec 3, 2021 2022 State of Fashion A recent study released by Bain & Co. and Altagamma projects that the industry will reach $1.4 trillion in sales revenue this year, growing 21 percent from 2021. Subscribe to Bain Insights, our monthly look at the critical issues facing global businesses. Luxury sales to grow at least 5% this year - Bain | Reuters Online sales rose 20% from 2021 to 2022 to reach an estimated 75 billion. Within accessories, leather goods grew by 23%25%, far surpassing its pre-Covid levels (up 39%41% compared with 2019). We observed stronger growth in the medium-priced segment as global uncertainty discouraged bids on higher-priced items. Please select an industry from the dropdown list. IHG fills luxury gap in Marbella with Kimpton's third Spanish signing More Vantage A retail location intelligence solution to inform your footprint decisions More Accelerated Performance Transformation The 19th edition of the Bain Luxury Study, published by Bain & Company for Fondazione Altagamma, the trade association of Italian luxury goods manufacturers, analyzed recent developments in the global luxury goods industry, as well as its future outlook. The nonfungible token (NFT) market stabilized after a wave of speculative interest from investors. 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. Websites devoted to a single brand gained ground on other types of online platforms and now make up 40% of the online segment, up from 30% in 2019. In coming years, the spending of Gen Z and Gen Alpha is set to grow some three times faster than for other generations until 2030, making up a third of the market. Monobrand stores were boosted by the willingness of customers to return to in-person shopping. 3. We observed a rebound when and where Covid restrictions were lifted, yet not enough to offset the performance of the second quarter. Hiring Process: Associate Consultant | Bain & Company Spending on experiences should be the last luxury outlay to recover historical highs, given its reliance on the resumption of international tourism and business travel. Retailers can accelerate without knowing for sure. We complement our tailored, integrated expertise with a vibrant ecosystem of digital innovators to deliver better, faster, and more enduring outcomes. The prompt 2021 rebound suggests that growth will be healthy for the personal luxury goods market in the medium term. Luxury goods brands started this year showing especially strong growth while also playing a leading role in the worlds ongoing sustainable and digital transformation., 2022 started strong, with the US and Europe leading growth. The industry is poised to see further expansion next year and for the rest of the decade to 2030, even in the face of economic turbulence. The Long View by Vogue Business: Inside the luxury jewellery boom Spending on experiences will be the last luxury outlay to recover historical highs given its reliance on the resumption of international tourism and business travel. 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. Osinuga v BPP University Ltd Legal Team [2022] EAT 53 (21 June 2022) 4. Winners will rapidly embrace the changes, ensuring they fully understand the implications of new geopolitical dynamics and cultural trends for all of their stakeholders: consumers, investors, employees and society at large. Skin care was boosted by a wave of pampering, although the weak performance of travel retail is still holding beauty back. Please select an industry from the dropdown list. The apparel category grew by 22%24% in 2022, aided by wardrobe restocking. Luxury Goods: trends and predictions for 2022 (Bain Report) Our 11th annual report looks at the pandemics effects, the industrys impressive recovery, and the possibilities ahead. Luxury spending continued to skew toward products, with steep growth in personal luxury goods and more moderate growth in experience-based goods. Power Luxury Brands Take Control Of The Luxury Market In 2021 - Forbes Additionally, China continued to see double-digit growth last year and Western markets experience sustained local demandthe United States, in particular, maintained momentum, even after federal stimulus cheques ended. First, Chinese consumers are set to become the dominant nationality for luxury, growing to represent between 40% to 45% of global purchases. Chinas luxury market is expected to recover between H1 and H2 2023. The apparel category grew in 2021, but not sufficiently to close the gap with 2019. Beauty recovered to 60 billion, just 1% below its 2019 level. The coming years will see a further blurring of the boundaries between monobrand outlets and e-commerce, which will increasingly push brands to take an omnichannel 3.0 approach, enabled and enhanced by new technologies. Sparkling wine (and not just Champagne) gained share over still. Bain Partner Claudia D'Arpizio appeared on Bloomberg News to discuss the increase of personal luxury goods spending in 2021. This turbocharged recovery was enabled by profit-hunting programs rapidly launched during the crisis and by a sales rebound that favored higher-margin direct channels. Art-based NFTs still represent a limitedalbeit expandingportion of the overall market; artists are looking for ways to meaningfully integrate NFTs into fine arts. These small brands, many of which are newcomers, currently make up 2% of the market but are growing twice as fast as the broader industry. Yet, they still require an infrastructure catch-up to facilitate the expansion locally. Consumer expectations for service levels are rising too, with brands embracing direct-to-consumer models to create a more luxurious shopping experience at every stage. proved much more significant than its 2020 policies. 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. All markets fared well throughout the year, aided by healthy domestic demand and the return of tourists from the US and Middle East. Luxury hospitality bounced back from the middle of the second quarter of 2021, and occupancy rates progressively increased. Department stores experienced faster growth than in previous years, gaining 20%. The market reached 79 billion, up 20% to 22% at current exchange rates from 2020, but still down 58% to 62% from 2019. Watches and beauty grew back to their 2019 levels. The robust performance in 2022 suggests that growth should stay healthy for the personal luxury goods market in the medium term. Across 65 cities in 40 countries, we work alongside our clients as one team with a shared ambition to achieve extraordinary results, outperform the competition, and redefine industries. Over the past two decades, the Bain & Company Luxury Study has become a reference point for the industry, but it has never seen a year of surging performance to match 2021. A powerful factor for sector growth in the rest of the decade will be generational trends, the analysis reports. Their comeback is inherently linked to the resumption of global travel (particularly of tourism out of China). Across 65 cities in 40 countries, we work alongside our clients as one team with a shared ambition to achieve extraordinary results, outperform the competition, and redefine industries. The pandemic-fueled interest in consuming gourmet food at home continued, boosting select food retailers and fostering demand for culinary education. Bains insights are based on triangulating information and sources available as of November 5, 2021, including the following: The scenarios do not consider disruptive changes in Covid-19 status quo (e.g., potential future waves of Covid-19 related to variations of the virus). Strong demand for luxury belts proved not everyone wore sweatpants in 2021 (at least not all the time). The market for personal luxury goodsthe heart of the entire luxury industryenjoyed another year of strong double-digit growth. 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. For more analysis of the top 25 companies, please click here, but below is the full list of Scotland's top 500 firms. 2022 Mid-Year Luxury Trends Report - Christie's International Real Estate Luxury brands have faced three years of tremendous turbulence and uncertainty, but the industry shows more strength, resilience, and ability to innovate than before. Chinas luxury market is expected to recover by the second half of 2023. The US is tapping into the power of diversity and inclusion. Asia. Womens occasion shoes also accelerated. Our 2021 Luxury Goods Worldwide Market Study shows how brands can build on their historic rebound. The market for personal luxury goodsthe core of the core of luxury segments and the focus of this analysishas come roaring back, experiencing a V-shaped recovery in 2021. Broader meanings and business models will emerge. Asia (excluding Japan) switched to second position, followed by Europe. There was a solid rebound in overall global spending by US and Latin American consumers in 2021, with some previously unheralded cities such as Denver and Austin emerging as luxury hotspots. Luxury Sales Set to Grow by 5 to 15% This Year, Bain Says The report, The State of Smooth: Unpacking Luxury in 2022, is based on findings from a survey of more than 1,000 U.S. shoppers in addition to proprietary data from Klarna. The luxury watch market regained its record 40 billion valuation, reflecting solid demand for ber-luxury and iconic pieces, as well as genderless watches. The country has increased its size and cultural relevance, replacing touristic spending with local demand. 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. 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. Mainland China should overcome the Americas and Europe to become the biggest luxury market globally (25%27% of global purchases). Third, online is set to become the leading channel for luxury purchases. Winners will rapidly embrace the changes, ensuring they fully understand the implications of new geopolitical dynamics and cultural trends for all of their stakeholders: consumers, investors, employees and society at large. The 21st edition of the Bain & Company Luxury Study, released in collaboration with Italian luxury goods body Fondazione Altagamma, shows a continuation of 2021s potent recovery in 2022, despite rising macroeconomic pressures throughout the year. Global luxury goods market takes 2022 leap forward and remains poised By Mimosa Spencer. Uber-luxury jewellery with a price tag above 100,000 outperformed globally over lower-priced categories, as did iconic pieces and lines, the Bain report states. The overall luxury industry tracked by Bain & Company encompasses both luxury goods and experiences. Yet, local consumer appetite remains strong. The impact of a possible global recession on the industry in 2023 could differ from the impact of the 200809 global financial crisis. Generation Y (millennials) and Generation Z accounted for all of the markets growth in 2022. Sales of fine wines and spirits rebounded strongly, reaching 77 billion, up nearly 2% from 2019, boosted by people throwing themselves into post-lockdown socializing in a mood of revenge conviviality. Spirits grew the most, due to rising consumption of Asian spirits (mostly baijiu) and growing interest in high-status spirits. The luxury industry as tracked by Bain & Company encompasses both luxury goods and experiences. After contracting in 2020 due to the pandemic, the market grew by 13%to 15% in 2021 to 1.14 trillion, according to our estimates. Luxury market forecast to grow despite global recession fears Energy groups overtook financial services firms during the last year, as prices rose and the transition to renewables accelerated. Local consumption was held back by slow vaccine uptake. We expect that solid market fundamentals will result in annual growth rates between 5% and 7% until 2030. Sales of luxury cars, the biggest portion of the overall market, beat their 2019 record, reaching 551 billion, 7% to 9% more than 2020 at current exchange rates, and 0% to 1% up from 2019. As 2022 draws to a nervy close, the market is headed for a 22% year-over-year increase. Profitability has already recovered to pre-Covid levels: We forecast that a typical brands earnings before interest and taxes margin nearly doubled in 2021 to 21%, up from 12% in 2020. Taken together, the study characterizes these trends as the nouvelle vague or new wave of developments for the sector. By the end of 2030, digital assets and the metaverse will comprise 5-10% of the luxury market. Download By Bain & Company Scope: Global Mar 14, 2022 2020 comCap Evolution of Digital Brands Report The rise . Luxury brands have the opportunity to play a key role in shaping the virtual worlds on the rise, acting as creators and builders. We work with ambitious leaders who want to define the future, not hide from it. Ongoing Covid-19 restrictions and economic uncertainty caused the first personal luxury market decline in five years. After its worst dip in history, the personal luxury goods market has experienced a v-shaped rebound, reaching 288 billion in value. The pandemic has nonetheless changed the global map of luxury. Accessories remained the largest personal luxury goods category in 2021 and grew by 8% relative to 2019, to reach 62 billion, with iconic product ranges and new must-haves showing strong momentum. Thats visible in the different recovery trajectories of luxury goods vs. luxury experiences. The most likely outcome in the fourth quarter is a 1% year-over-year rise. All personal luxury goods categories have now recovered to 2019 levels or better, with hard luxury, leather, and apparel leading the resurgence following the pandemic. Outlets started to recover thanks to the easing of Covid-19 restrictions but still lagged their historical levels. Sparkling wine, disproportionately hit in 2020, recovered better than other segments of the wine market. As 2022 draws to a nervy close, the market is headed for a 22% year-over-year increase. The studys lead author is Claudia DArpizio, a Bain partner in Milan. According to our forecasts, shoes grew by 11% compared with 2019 to reach 23 billion, thanks to a switch to casual footwear (although there are signs that women are now snapping up shoes fit for more extrovert occasions). While there will not be "another China" to drive a. Most brands are now covering multiple price points to respond to different customer segments and needs. While US luxury market is still strong, and Europe managed to recover beyond 2019 thanks to solid local demand alongside an extra-boost from US and Middle Eastern tourist shoppers, new markets are surprising the industry. Luxury and the Abaya: The Middle East makes its mark - INSEAD Knowledge Sales are set to beat their pre-Covid record in 2021, with the market forecast to grow by 29% at current exchange rates to 283 billion, up 1% from its 2019 record. Post-streetwearis emerging as the new look. Luxury brands have faced two years of tremendous turbulence, but the industry is coming out of the crisis with more strength, resilience, and agility than before. Younger generations (Generations Y, Z, and Alpha) will become the biggest buyers of luxury by far, representing 80% of global purchases. 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. 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. The luxury watch market regained its record 40 billion valuation, reflecting solid demand for ber-luxury and iconic pieces, as well as genderless watches. The studys lead author is Claudia DArpizio, a Bain partner in Milan. We earned a platinum rating from EcoVadis, the leading platform for environmental, social, and ethical performance ratings for global supply chains, putting us in the top 1% of all companies. The policy-led transition toward greener automobiles continued. China's luxury market shrank 10% in 2022 -Bain | Reuters 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.
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