Financial and Technology News

Chinese to take 46% of luxury sales by 2025

 2019/01/21
BUYING POWER:The Bain & Co studay said high-end sales in China are forecast to be up 18 percent this year, while the Americas and Europe remain flat.
 
Chinese consumers are to remain the driving force for the luxury goods market and account for nearly half of global high-end sales by 2025, a Bain & Co study released on Thursday showed.
 
Chinese shoppers are expected to account for 46 percent of global luxury sales of about 365 billion euros (US$414.47 billion) in just six years, the consultancy firm said in the study, which was prepared for Italy’s Altagamma Foundation, an association of Italian high-end goods producers.
 
That is up from one-third of all sales of luxury apparel, accessories and cosmetics last year.
 
Half of those purchases would be made in China, as price differences between countries fade and brands improve the customer experience in China, Bain partner Claudia D’Arpizio said.
 
Bain said luxury sales this year are forecast to grow 2 percent to 260 billion euros, in figures restated to exclude luxury art, design and decor.
 
Taking into account both luxury goods and experiences, the market is expected to grow by 5 percent to 1.2 trillion euros globally.
 
Luxury goods sales in China this year are forecast to be up 18 percent to 23 billion euros. Europe and the Americas, still the two largest markets, remain flat due to strong currencies, totaling 84 billion euros and 80 billion euros, respectively.
 
Bain identifies five different generations of luxury goods consumers in the market, from those born before 1945 whose spending focuses more on experiences than hard luxury, to teenagers who favor casual wear like expensive sneakers, D’Arpizio said.
 
“This is an opportunity for brands to cherry-pick the customer. Loro Piana and Balenciaga have different customer bases, while Gucci or Louis Vuitton can be relevant for teenagers or older customers,” she said.
 
“That is why we are very positive on the market going forward,” she said, with annual growth of 3 to 5 percent.
Back