According to Bain & Associates' launch of the 2017 Global Luxury Industry Research Report on October 25 in partnership with the Altagamma Foundation of the Italian luxury trade association, an increase in the spending power of personal luxury in China is setting the stage for global luxury goods in 2017 Market recovery injected strong momentum.
The key global luxury market figures mentioned in the report are as follows:
1. In 2017, the global luxury goods market (generalized luxury goods market, including high-end luxury cars, tourism and other high-end experience) is expected to achieve an overall 5% year-on-year growth and the estimated output value of 1.2 trillion euros.
2. Luxury car sales rose 6%, the total output value of 489 billion euros, the luxury goods industry as a whole the main driving force for growth.
3. Production of personal luxury is expected to be 262 billion euros, an increase of 6% at constant exchange rates, up from 2% to 4% previously forecast.
The increase in growth reflects Bain's view that a healthy 'new normal' growth model will eventually emerge in the global luxury goods market thanks to the strong Chinese market and the rise of millennial consumers worldwide.
China's luxury market has grown more than all other countries
As Chinese consumers' spending on luxury goods continues to surge both domestically and internationally, the report expects China's domestic luxury market to grow 15%, and the company also predicts that by 2017 Chinese buyers will account for 32% of global luxury spending.
In 2017, the personal luxury goods industry in various regions of the world showed as follows:
Europe: The luxury goods market in Europe maintained a rebound, with total retail sales of personal luxury goods reaching 87 billion euros, an increase of 6% over the same period of the previous year. The increase in visitor spending has played a significant role in the luxury markets in Britain, Spain and France Promote the role.
Mainland China: The rising demand for luxury goods from the middle class has greatly boosted the sales of luxury goods in mainland China, up 15% from the same period of last year. It has the highest market value and the total market capitalization of 20 billion euros.
Japan outside Asia and China: total output value of 36 billion euros, an increase of 6% over the same period of last year. The recovery of Hong Kong and Macao is the main driving force for growth.
Japan: Driven by the increase in tourist spending in Japan, Japan's personal luxury goods market reached 22 billion euros, an increase of 4% over the same period of last year.
Americas: Personal luxury goods output 84 billion euros, an increase of 2%. Canada and Mexico performed very well, but the United States because of the overall sluggish department store industry, so the brand is still full of challenges.
Middle East: Except for Dubai, the rest of the region showed mediocre performance, with the overall increase expected to be around 1%
The rise of the online luxury market has led to a physical store shift
The online luxury sector is booming in 2017 and Bain expects to grow 24%. The report predicts that by 2025, online channel market share is projected to reach 25%, up from 9% in 2017.
The collapse of online luxury sales channels shows that e-retailers will outperform brands and retailers' sites in total growth in 2017 due to their strong relationships with brands and their unique content and business integration efforts 39%.
Meanwhile, the luxury brand's own e-commerce site is also prevalent in 2017, which accounts for 31% of the global network's total sales in the past year including Gucci, Hermes and Louis A series of elite luxury brands, including Louis Vuitton, have stepped up their e-commerce efforts.
The above developments mark the shift in attitude of luxury goods companies to the digital channel, which brands in the past were reluctant to embrace digitized because they perceived digital as having an exclusive impact on consumers more than benefits.
Bain said over the next ten years, the offline physical network will continue to shrink, "the report states: 'The store needs to be seen as an episode of the brand's narrative to impress and reassure customers at the same time.' ' Pointed out that the physical store in the new retail era should play a new role.
For luxury brands, it is also important to integrate the various sales channels and create a seamless online-to-offline shopping experience for consumers.Bain recommends that the brand leverage the online platform as a 360 ° support channel for physical networks.
Brands need to attract luxury travel consumers
The booming tourism and tourism markets around the world, especially in China, blur the line between domestic and foreign consumption of luxury goods and show the growing importance of brands to consumers of luxury travel.
It is a well-known fact that Chinese tourists have a strong interest in buying luxury goods while traveling abroad. On a budget, middle-class consumers like to take advantage of price differences and duty-free shops in overseas duty-free shops and export shopping centers. On the other hand, super-rich customers Like shopping abroad for better customer service and more product choices.
Thus, Bain said luxury brands are responding to this growing need to serve tourists outbound, and brands should treat them through 'tweaking storefront concepts', 'providing products and in-store experiences at specific locations rather than trading' And 'make them feel welcome and recognized everywhere.' In serving domestic customers, brands should encourage them to offer multiple forms of shopping in the city, often updated categories, to relax in-store experiences and create a Seamless shopping experience.
The rise of millennialism has given birth to 'new luxury'
Bain said that with the younger generation into the luxury market, the significance of luxury goods have undergone tremendous changes.Luxury consumption has become a way of self-expression, allowing them to feel a group of people who share the same values.Y generation and Z The generation values the brand's creativity and strong opinion because they see their shopping behavior talking about their personal thoughts and preferences.
In addition, Millennials need to have a stronger relationship with the brand than their predecessors, and the report states: "Consumers do not want to just listen to brand stories, they want to live out stories." Therefore, luxury brands Need to come up with creative marketing activities to attract consumers, make them part of the ongoing dialogue, completely immersed in the luxury brand creation experience.
Looking ahead, Bain Capital has a positive attitude towards the global luxury goods market and expects the global luxury goods market to grow by 4% to 5% annually by 2020. It specifically refers to China's middle class and Generation Y and Generation Z's promotion Two major forces of development.