Luxury Goods Market

Luxury Goods Market Size:

The global luxury goods market size reached US$ 275.2 Billion in 2023. Looking forward, IMARC Group expects the market to reach US$ 390.3 Billion by 2032, exhibiting a growth rate (CAGR) of 3.96% during 2024-2032. The market is primarily driven by the increasing economic growth, changing consumer behavior, rising number of sustainability initiatives, rapid digitalization, expansion of resale market, and quality and exclusivity offered by luxury brands.

Luxury Goods Market Analysis:

• Major Market Drivers: Growing customer desires for premium lifestyles and rising disposable incomes are the two main market drivers for the global luxury goods industry. Furthermore, the emergence of wealthy middle classes in emerging economies boosts demand for luxury goods and encourages innovation in the industry.
• Key Market Trends: Growing emphasis on sustainability and ethical sourcing, along with a growing need for individualized and experiential luxury offers catered to specific tastes and lifestyles, are some of the major market trends in the luxury goods sector.
• Geographical Trends: The market for luxury products is expanding rapidly, with Asia-Pacific emerging as the largest region due to increased disposable incomes and an expanding wealthy consumer base. Europe is the second largest market, due to its strong tradition of luxury consumption and tourism influx.
• Competitive Landscape: Some of the major market players in the luxury goods industry include Chanel, Compagnie Financière Richemont S.A., Gianni Versace S.r.l, Giorgio Armani S.p.A, Hermès International S.A., Kering S.A., LVMH Moët Hennessy Louis Vuitton, Prada S.p.A., Ralph Lauren Corporation, Rolex SA, The Estée Lauder Companies Inc., The Swatch Group Ltd, Valentino S.p.A., among many others.
• Challenges and Opportunities: Challenges in the market include increasing environmental consciousness. Opportunities include growing proliferation of technology for online sales, personalized marketing, and virtual experiences.

Luxury Goods Market Trends:

Experiential Luxury and Millennial Preferences

The market for luxury goods is changing as a result of the changing tastes of millennial buyers, which place an increasing focus on experience luxury as opposed to conventional material possessions. According to studies, millennials value experiences more than material possessions and are looking for unique opportunities to interact with brands. Numerous factors are driving the trend toward experience luxury. Special experiences that foster personal development and self-expression are highly valued by millennials. According to a survey by Eventbrite, 78% of millennials would rather spend money on experiences than tangible goods. Luxury travel packages, personalized lifestyle services, and invitation-only events are just a few of the immersive experiences that luxury firms are offering to capitalize on this trend.

Digital Transformation and E-Commerce Growth

The way that consumers find, interact with, and buy luxury goods is being completely transformed by the digital revolution in the luxury goods industry. As per Forbes, the retail e-commerce sector grew by 16 per cent in 2021, bringing in over 4.9 trillion dollars in sales globally. By 2025, this amount ought to expand by 50% to $7.4 trillion. Access to luxury products has been more accessible due to the growth of social, digital technology, and e-commerce platforms. This has allowed firms to reach a worldwide audience and media offer customized shopping experiences. The luxury goods market is witnessing exponential increase in sales due to e-commerce, which has emerged as a crucial development driver. Lockdowns and social distancing measures brought on by the COVID-19 pandemic further increased the trend toward online shopping by encouraging individuals to buy luxury goods through digital means.

Rising Affluence in Emerging Markets

The growing luxury goods market is mostly being driven by the rising affluence of emerging economies, especially in areas such as Asia-Pacific. The number of high-net-worth individuals (HNWIs) and wealthy middle-class consumers has been gradually increasing as these regions' economies continue to grow. In 2020, the Asia-Pacific area surpassed Europe to account for 35% of global luxury consumption, according to a report by Bain & Company. China in particular has become a global leader in luxury spending due to the rapidly expanding middle class of the nation, which is boosting demand for high-end brands. This rise in affluence is fueled by factors such as urbanization, increasing disposable incomes, and a growing appetite for luxury lifestyles.

Luxury Goods Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the global, regional, and country levels for 2024-2032. Our report has categorized the market based on product type, distribution channel, and end user.

Breakup by Product Type:

• Watches and Jewellery
• Perfumes and Cosmetics
• Clothing
• Bags/Purse
• Others
   

Watches and jewellery accounts for the majority of the market share

The report has provided a detailed breakup and analysis of the market based on the product type. This includes watches and jewellery, perfumes and cosmetics, clothing, bags/purse, and others. According to the report, watches and jewellery represented the largest segment.

Watches and jewelry make up the largest portion for a variety of reasons, their demand is constant across various demographics and cultures, and they are regarded as necessary accessories for both men and women. In particular, watches are useful accessories that many individuals use on a daily basis, making them necessities. According to IMARC Group, the luxury watch market is expected to reach US$ 36.8 Billion by 2032, exhibiting a growth rate of 2.9% during 2024-2032. Their demand in the luxury market is fueled by their status as fashion statements and status symbols.

Breakup by Distribution Channel:

• Offline
• Online
   

Online holds the largest share of the industry

A detailed breakup and analysis of the market based on the distribution channel have also been provided in the report. This includes offline and online. According to the report, online accounted for the largest market share.

The online sector holds the greatest share of the market due to its numerous benefits and the way consumer behavior is evolving. Online platforms provide businesses and consumers with ease, accessibility, and a broad reach, which has led to a change in distribution methods toward online platforms. With the growth of e-commerce, businesses may now operate with lower overhead expenses than traditional brick and mortar stores, reach a wider audience, and access a global market. Additionally, consumers are becoming more and more accustomed to using online channels due to their capacity to offer a flawless buying experience, tailored recommendations, and effective delivery services. According to IMARC GROUP, the global e-commerce market is expected to reach US$ 183.8 Trillion by 2032, exhibiting a growth rate of 27.16%.

Breakup by End User:

• Women
• Men
   

Women presents the leading market segment 

The report has provided a detailed breakup and analysis of the market based on the end user. This includes women and men. According to the report, women represented the largest segment.

Women are the largest segment in the market breakup by end-user due to their significant buying power and influence on consumer spending. According to HARWARD REVIEW, women control about $20 trillion in annual consumer spending, and this figure is expected to reach $28 trillion in the next 5 years. Additionally, women are becoming primary decision-makers in households globally. Besides this, women are also considered primary targets for various products and services, such as cosmetics, healthcare, and apparel. Moreover, the influence of women extends to numerous product categories.

Breakup by Regional:

• North America 
  • United States 
  • Canada 
• Europe
  • Germany 
  • France 
  • United Kingdom 
  • Italy 
  • Spain
  • Others 
• Asia Pacific
  • China 
  • Japan 
  • India 
  • South Korea 
  • Australia 
  • Indonesia
  • Others
• Latin America
  • Brazil 
  • Mexico 
  • Others 
• Middle East and Africa
   

Asia Pacific leads the market, accounting for the largest luxury goods market share

The report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Europe (Germany, France, the United Kingdom, Italy, Spain, and others); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Latin America (Brazil, Mexico, and others); and the Middle East and Africa. According to the report, Asia Pacific represented the largest market for luxury goods.

Asia Pacific holds maximum number of shares in the luxury goods market due to several reasons. The significant economic growth of the region has led to increased disposable incomes, especially in markets such as Japan, South Korea, and Japan, thus making it a lucrative market for international and luxury brands. Additionally, the large youth population across the region, especially those aged between 15-24 years, are keen on purchasing luxury goods, thus propelling the market. According to the UN, above 60% of the global youth lives in Asia-Pacific, that is more than 750 million young men and women are aged 15 to 24 years.

Competitive Landscape:

• The market research report has also provided a comprehensive analysis of the competitive landscape in the market. Detailed profiles of all major companies have also been provided. Some of the major market players in the luxury goods industry include Chanel, Compagnie Financière Richemont S.A., Gianni Versace S.r.l, Giorgio Armani S.p.A, Hermès International S.A., Kering S.A., LVMH Moët Hennessy Louis Vuitton, Prada S.p.A., Ralph Lauren Corporation, Rolex SA, The Estée Lauder Companies Inc., The Swatch Group Ltd, Valentino S.p.A.
  
  (Please note that this is only a partial list of the key players, and the complete list is provided in the report.)
   
• Key players are adopting numerous methods to maintain growth, including joint ventures, introduction of novel products, and mergers and acquisitions to increase their market share. For instance, L’Oreal entered into an agreement with Prada S.p.A. to produce and distribute luxury beauty products. Besides this, companies are also concentrating on exclusivity, quality, and unique designs in order to cater to the evolving demands of the consumers. Other than this, key players are extensively investing in research and development (R&D) activities in order to expand their product portfolios.

Luxury Goods Market News:

• January 2021: LVMH Moet Hennessy Louis Vuitton SE announced the acquisition of global luxury jeweller, Tiffany & Co.
• April 2021: LVMH, Richemont, and Prada Group announced their partnership to launch a platform called Aura Blockchain Consortium 34. This platform will allow consumers to access and view the product history from its sourcing to sales. This strategic step has been taken to establish the authenticity of luxury goods.

Luxury Goods Market Report Scope:

Key Questions Answered in This Report:

• How has the global luxury goods market performed so far, and how will it perform in the coming years?
• What are the drivers, restraints, and opportunities in the global luxury goods market?
• What is the impact of each driver, restraint, and opportunity on the global luxury goods market?
• What are the key regional markets?
• Which countries represent the most attractive luxury goods market?
• What is the breakup of the market based on the product type?
• Which is the most attractive product type in the luxury goods market?
• What is the breakup of the market based on the distribution channel?
• Which is the most attractive distribution channel in the luxury goods market?
• What is the breakup of the market based on the end user?
• Which is the most attractive end user in the luxury goods market?
• What is the competitive structure of the market?
• Who are the key players/companies in the global luxury goods market?

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the luxury goods market from 2018-2032.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the global luxury goods market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the luxury goods industry and its attractiveness.
• The competitive landscape allows stakeholders to understand their competitive environment and provides insight into the current positions of key players in the market.