The luxury goods market is experiencing accelerated growth worldwide, with a record-breaking year in 2022 and further expansion expected in the coming years. According to the Luxury Goods Worldwide Market Study – Spring 2023, conducted by Bain & Company and Altagamma, the personal luxury goods market is projected to grow by 5-12% in 2023, surpassing the €345 billion mark achieved in 2022. Despite economic uncertainties, the industry is expected to reach €530-570 billion by 2030, more than doubling its size from 2020.
The study reveals that the luxury shopping landscape varies across regions. While the United States is witnessing a slowdown in luxury spending due to economic uncertainties, Europe is experiencing a rise in sales driven by tourism. However, Europe’s resilience may face challenges in the second half of 2023 when the decline in US and Middle Eastern tourists is expected to impact local luxury shopping. In contrast, Asia is undergoing a reshuffling, with destinations like Hong Kong, Macau, and Southeast Asia attracting Chinese tourists and driving growth in the luxury market.
Within the luxury goods categories, watches and jewellery are performing exceptionally well. Customers are opting for “less but better” purchases, focusing on iconic and uber-luxury pieces. Iconic bags and shoes continue to drive spending, while beauty products such as fragrances are also witnessing growth. The study highlights the importance of experientiality and travel retail, as these channels regain popularity and tap into other luxury markets.
Looking ahead to 2023 and beyond, the luxury market is expected to continue its growth trajectory. In the positive scenario, sales growth in the personal luxury goods market is projected to be between 9% and 12% in 2023. However, a more realistic scenario suggests a growth rate of 5% to 8%, influenced by a slowdown in mature markets and a slower recovery in China. By 2030, the market is predicted to reach a value of €530-570 billion, driven by solid market fundamentals.