This report examines a number of key dynamics that are affecting how the world of luxury is developing. These include the impact of globalization and the changing patterns of wealth across nations, as well the constant push for innovation and the integration of new technology. We study examples of brands and businesses, both those that are faring well and those that are struggling.
- Identify what product features help create luxury, and how these can be developed.
- Understand the changing patterns of engagement that consumers have with luxury and what this means for how businesses need to behave.
- Analyze the fast-growing Asian markets to get beneath the hype of opportunity and see clearly the challenges that also need to be factored in.
- Evaluate where new growth in luxury fits and aligns with current dynamics.
- Gain perspective on the need for a balance between tradition and innovation in luxury.
- Given the premiumization of many everyday items, how can luxury products remain special?
- In a globalized world with the homogenization of needs and aspirations, how can luxury strike a balance between local alignment and brand consistency?
- At a time when consumer distrust and scrutiny of corporates is high, how should luxury businesses communicate with customers?
- What routes are open to companies wishing to enter or strengthen their presence in the luxury landscape?
- How should luxury brands balance the pressure to grow revenues through category extensions with the threat of brand dilution?
Growth in the luxury market has remained strong over recent years, despite the backdrop of a global financial crisis. Global luxury sales have grown 20% since 2008, a significant achievement considering that global GDP growth was very weak during this period and even negative in 2009.
The luxury market in India has potential but requires stamina and resourcefulness. Over the past decade, more than 150 international fashion brands launched in India have either changed partners or exited the country.
China is a market of great opportunity for luxury. According to the most recent Bain study, out of a global consumption base of 330 million luxury consumers, 50 million are Chinese. The Chinese are now the largest nationality of luxury buyers worldwide, with purchases that make up 29% of the global market.