The Chinese will Account for 50% of Luxury Sales by 2025
Chinese consumers remain the focus of luxury goods makers, as a new study by Bain consultancy shows they will fuel nearly half of global high-end sales by Y 2025.
Bain said Thursday that Chinese shoppers will account for 46 – 50% of global luxury sales of an estimated $412-B in just 6 years. That is up from 33% of all sales of luxury apparel, accessories and cosmetics last year.
Bain partner Claudia D’Arpizio says 50% of those purchases will be Made in China, as price differences fade and brands improve the customer experience in the country.
Bain said luxury sales this year are forecast to grow 2% to EUR 260-B, from EUR 254-B last year, in figures restated to exclude luxury art, design and decor.
Luxury goods sales in China this year are forecast to be up 18% to EUR 23-B.
Europe and the Americas, are still the 2 largest markets, but remain flat due to strong currencies, totaling EUR 84-B and EUR 80-B, respectively.
Mr. D’Arpizio said that Bain identifies 5 different generations of luxury goods consumers in the current market, from those born before Y 1945 whose spending focuses more on experiences than hard luxury, to current teenagers who favor casual wear like expensive sneakers.
“This is an opportunity for brands to cherry-pick the customer. Loro Piana and Balenciaga have different customer bases, while Gucci or Louis Vuitton can be relevant for teen-agers or older customers,” she said.