According to a recent report by consultancy firm Bain, global sales of luxury goods are projected to experience a growth rate of at least 5% this year. Despite concerns around political uncertainty and rising inflation, consumers in the United States and Europe are still actively purchasing high-end items like watches, jewelry, and shoes. Claudia D’Arpizio, a partner at Bain, has stated that consumer consumption has not shown signs of being negatively impacted thus far.
Bain’s latest estimates anticipate that global sales of personal luxury goods will reach a minimum of 305 billion euros ($320 billion) this year, with a possibility of reaching up to 330 billion euros in a more optimistic scenario. These projections represent an increase from the previous range of 300 billion to 310 billion euros. The revised figures take into account the strong sales performance currently being observed, even in the face of stock market volatility in the United States and concerns surrounding a potential economic recession. D’Arpizio acknowledges the turbulent environment but remains positive about the future of the luxury goods market. The analysts at Bain also noted that global sales of personal luxury goods, which encompass clothing, accessories, and beauty products, exceeded their previous forecast of 283 billion euros for 2021, reaching 288 billion euros instead, thanks to robust holiday spending.
Despite the challenges posed by high inflation and COVID-19 lockdowns in mainland China, luxury brands have managed to tap into local demand in Europe and the United States through effective marketing strategies. D’Arpizio expressed surprise at the resilience of consumer confidence, given the inflationary pressures. Bain predicts that domestic spending by Chinese consumers will recover in the second half of the year and also highlights South Korea as a burgeoning market for luxury goods. In a previous report, Bain revealed that the United States surpassed Europe as the largest luxury market in the world.
Useful links:
– Bain’s Global Luxury Report 2022
– CNBC’s article on Bain’s Luxury Sales Forecast
