Topic: Global personal luxury goods industry (2024)

FAQs

Is the luxury industry a good industry to be in? ›

The luxury industry has been on an impressive growth trajectory over the past few decades, marking its resilience and adaptability. Despite global economic downturns, changes in social trends, or even health crises, the demand for luxury products and experiences has remained high.

In 2022, the value of the personal luxury goods market worldwide was estimated to be 353 billion euros. The global luxury goods industry, which includes drinks, fashion, cosmetics, fragrances, watches, jewelry, luggage and handbags, has been on an upward climb for many years.

In 2024, the Luxury Goods market is projected to generate a revenue of US$368.90bn. This market is anticipated to grow at an annual rate of 3.22% (CAGR 2024-2028). The largest segment within this market is Luxury Fashion, which is expected to reach a market volume of US$115.90bn in 2024.

Luxury is essentially characterized by rarity, quality and price. It can concern several sectors of activity such as the hotel industry, gastronomy, cosmetics, haute couture, travel or leather goods. If you want to work in the luxury industry, you need the right training.

Stimulating the Global Economy

The high demand for products from European brands, such as Italian and French fashion, Swiss watches, and German automobiles, not only drives economic growth in these countries but also fosters employment and the development of specialized skills.

Luxury items tend to be sensitive to a person's income or wealth, meaning that as wealth rises, so do purchases of luxury items. As a result, luxury items are considered to show positive income elasticity of demand, which is a measure of how responsive the demand is for a good to a change in a person's income.

South Koreans continue to stand out as the largest spenders of luxury goods in the world, ranking first globally in per capita spending in 2022, spending an average of 325 USD on luxury items, compared to the US at 280 USD and China at 55 USD.

Luxury Goods Market Insights

Luxury Goods Market size was valued at USD 230.05 billion in 2019 and is poised to grow from USD 242.8 billion in 2023 to USD 369.8 billion by 2031, growing at a CAGR of 5.4% in the forecast period (2024-2031). Premium goods play a significant role in displaying the status symbol.

Personal Luxury Goods refer to high-end products that are considered as a symbol of affluence and are primarily purchased for their exclusivity, craftsmanship, and brand value. This category includes designer clothing, accessories, watches, jewelry, cosmetics, and personal care products.

Products which are not necessary, but which tend to make life more pleasant for the consumer. In contrast with necessity goods, luxury goods are typically more costly and are often bought by individuals that have a higher disposable income or greater accumulated wealth than the average.

Why are luxury markets important today? ›

We estimate that new-luxury goods already represent about $350 billion—or 19%—of the combined $1.8 trillion in annual sales of 23 consumer goods categories and that the new-luxury segment is growing 10% to 15% annually. What's more, companies can quickly realize the profit potential of such goods.

LVMH. LVMH (Moët Hennessy Louis Vuitton) stands as the world's largest luxury goods company and one of the largest companies globally. It is renowned for its extensive portfolio of 75 prestigious brands, among which Louis Vuitton is the most valuable by a wide margin.

The three most important factors influencing the future of Luxury are evolving consumer preferences, technological advancements, and sustainability.

The main difference between luxury brands and other brands is that luxury brands focus on providing their customers with the highest quality products and services. Luxury brands have a long history and are known for their craftsmanship.

The luxury market is predicted to grow by 2%-4% in 2024, allowing for regional and international variations, according to McKinsey's analysis.

Luxury goods company sales soar, profitability higher than pre-pandemic levels. During FY2022 the Top 100 luxury goods companies generated composite sales of US$347 billion, up from the US$305 billion registered in FY2021.

Executive summary. Despite challenging macroeconomic conditions, we estimate the overall luxury market reached €1.5 trillion globally in 2023, a robust 8% to 10% growth over 2022 at current exchange rates (11% to 13% at constant exchange rates), setting a record for the industry and proving its unparalleled resilience.

Luxury as a whole is widely considered “recession proof” due to the fact that its shoppers tend to have more discretionary income. As recently as 2022, luxury sales surged as customers bought products like handbags and shoes.