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Global personal luxury goods market set to continue growing in 2023

Jul 11, 2023 World

After registering a record year in 2022, and despite uncertain macroeconomic conditions, the global personal luxury goods market is expected to grow between 5% to 12% in 2023

According to Bain & Company and Altagamma's 2023 spring luxury study, the global personal luxury goods market amounted to 345 billion euros in 2022, despite geopolitical tensions and macroeconomic uncertainty. In 2023, this market is set to reach between 360 billion euros and 380 billion euros, depending on a “realistic” growth scenario of 5% to 8% or a “positive scenario” of a 9% to 12% growth.

The study also shows in the first quarter of 2023 this market recorded a 9% to 11% growth year-over-year, due to the gradual easing of hyperinflation, higher local consumer confidence in Europe, China's reopening after the lifting of its zero COVID-19 policy restrictions and the intraregional tourism experienced in Japan and Southeast Asia.

In contrast, the US luxury market is slowing down, with consumers “refraining from spending”, mainly thanks to economic uncertainties and the end of the COVID-19 relief fund. “Top US customers are holding up, yet partially shifting their spending abroad as price differentials widen, and aspirational customers are spending less”, says the study.

“The luxury industry is experiencing a new phase after its post-pandemic growth, with renewed drivers of resilience establishing winners and losers”, states Claudia D'Arpizio, a Bain & Company partner and leader of Bain's Global Luxury Goods and Fashion practice. “Brands who want to succeed need to focus holistically on consumers; balance their exposure across geographies; offer a high-value proposition with elevated entry clienteling and experientiality at scale; and push on icons, timeless, and statement pieces”, she advises.

The American firm consultancy also noted that looking further out to 2030, the global personal luxury goods market is likely to reach from 530 billion euros to 570 billion euros, suggesting it will more than double the size it had in 2020.

Image Credits: Marissa Grootes on Unsplash

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