With the resumption of tourism and the search for exclusive experiences, the global luxury market showed significant stability and surpassed the mark of 1,5 trillion euros in 2023, even in the face of the economic and geopolitical turmoil of the period. The new Global Luxury Report from Bain & Company, developed in partnership with Altagamma, the Italian association of the luxury goods manufacturers industry, shows that, even so, the pace in 2024 indicates a slight slowdown
The research highlights the trend of demand for luxury experiences, to the detriment of tangible assets. The search for gourmet food and refined gastronomy has been driven by the recovery of the tourism industry and the increasing demand for immersive activities, how more intimate luxury cruises. Furthermore, the market has seen consistent growth in private jets and yachts, while showing a slight contraction in the segments of fine art auctions and luxury personal items
To maintain your relevance and resilience, luxury brands must rethink how their value proposition is built and need to prioritize trust and connection with their consumers, explain Gabriele Zucarelli, partner at Bain and leader of the Retail practice in South America. "To distance oneself from instability", the best way is to create a more personal connection between brands and customers. The positioning of companies regarding their purposes and the attention given to consumers will be the differentiators to highlight successful companies in an increasingly competitive scenario.”
Driven by tourism flows in the first quarter of 2024, Europe and Japan have shown greater resilience. An increasing number of people from around the world have been seeking the cities of the Japanese archipelago, and tourist flows in the country have surpassed pre-pandemic levels, supported by favorable exchange rates
On the other hand, the Chinese market remains under pressure, with the resurgence of outbound tourism and the weakening of local demand caused by economic uncertainties. Especially among middle-class consumers, the behavior of "shame of luxury" has been growing, similar to what happened in the US during the financial crisis of 2008-09. In the same way, Americans continue to face macroeconomic pressures, despite the signs of gradual improvement in GDP and consumer confidence
Around the world, younger generations have delayed spending on luxury goods due to rising unemployment levels and weakened future prospects. The Generation X and the Baby Boomers continue to enjoy the accumulated wealth, while attracting the attention of luxury brands. This positioning fuels the continuous growth of the number of high-end consumers.
To expand, many brands have adopted a dichotomous approach, focusing on key clients and large-scale events, while seeking to expand their reach, entering new territories, how the sport. This segment, seen as a branding opportunity for luxury goods for a long time, now it is a target for brands that want to invest in new sports. With the prominence that the 2024 Olympic Games in Paris are expected to gain, the branding opportunities to reach new audiences and engage existing customers in new ways promise significant results for 2024.
