The Storefronts of Dolce & Gabbana, Tiffany & Co. And Patek Philippe are seen as people enter icon siam, a luxury shopping mall located on the chao phraya river, on June 12, 2024 in Bangkok, Thailand.
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The Personal Luxury Goods Market Looks Set to Face Its First Slowdown Since the Global Financial Crisis this year, as macroeconomic uncertain and a pronounced slowdown in china weight Ording to the Bain & Company’s Annual Luxury Report.
This is the first slowdown in demand for personal luxury goods — which include clothing, bags, jewelry and cosmetics — in 15 years, excluding the Covid-19 lockdown period, according to the Wednesday findings.
Higher costs and Falling customer Loyalty Saw Shoppers Shun High-Ed Brands in 2024, Denting Company Profits and Likely to Cause the Sector to Contract by a Projected 2% Over the Full-Over the Full-Over The Report.
It noted that overall luxury spending is forecast to remain flat year-on-year in 2024 at around 1.5 trillion euros ($1.59 billion), even as segments including autos, travel and fine wine record modest growth.
China Weakness Weighs Heavy
Global Economic Uncertainty and Inflationary Pressures Have Emerged as Common Threads in the Earnings Reports of Luxury Labels this year, with LVMH, Burberry And Gucci-Owner Kering All Posting Repeated Revenue Misses.
But it’s dwindling demand from the key chinese market that has proven especially concerning for the sector, as the economy has struggled to rebound from a covid-19 -19 -ra slowdown.
Even Cartier-Owner Richemont. Reported A 1% Fall in Sales in the First Half of its fiscal year, due in part to weakened demand from China.
“Mainland China has experienced a sharp slowdown, Worsening through
Sustained Weakness in the China Market Weigh Further on the Luxury Sector in 2025, According to the Report, Which Nevertheles Cited Cited This as a Lower Probleity Outome and Intead Pointed to AC Cond Half of Next Year as Its More “Realistic Scenario . “
Luxury demand in europe and the us has shown signs of gradual improvement Quarter-on -Quarter this year, with japan leading the way due to favorite currency exchange rates. As such, the report forecast the sector will grow slightly Next year, Barring any Major Economic Headwinds.
Pockets of growth
The report also pointed to glimmers of light for the sector, with luxury cars and hospitality, fin wines and gourmet dining all recording gains this year.
Luxury Travel Particularly Emerged as an Area of Growth, with Consures Increasing
Small Personal Items, Such as Eyewear and Beauty, also Saw An Uptick, as Shoppers Opted for “Small Indulgences” Rather than Bigger Buys, The Report Said.
Nevertheles, it noted that luxury brands would need to do more to do more to attract and retain their Increasingly fickle consumer base, especially within the Younger Gen-Z Segment Covering Peeple BorN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN BORN COTHIN THE
“50 Million Luxury Consures Have Eather Opted Out of the Luxury Goods Market or Been Forced Out of It in the Last Two Years. Udia d’ARPizio, Partner at Bain & Company and Lead Author of the Study.
“To win back customers, particular the younger ons, brands will need to lead with creativity and expand conversation topics. Simultaneously, they must keep their Must Customers Fort and Center, Surpressing and CELIGHTING ILE Rediscovering One-to-One Human Interactions, ” She added.
