
Global sales of luxury products should progress by 5% in 2014, to 223 billion euros, according to a study published by Bain & Company. Market growth is driven by tourist spending, especially that of Chinese tourists.
Across the year, the growth of sales of luxury products is estimated at around 5% (versus 7% in 2013), bringing it to 223 billion euros. All the markets, with exception to Japan, China and South America are driven by purchases by tourists, with the nationality of taking precedence over the country where the purchase takes place. Chinese consumers are thus the leading consumers in terms of both purchasing volume and growth rate, and spend three times more when traveling abroad than in continental China. Inversely, Japanese tourists make most of their purchases in their own market due to the devaluation of the Yen.
On the American continent, the luxury market is increasingly supported by tourism, whereas this market is facing many evolutions in Europe, due to changes in the buying behavior of different nationalities. Thus, duty-free Chinese consumption increased by only 10% in the first eight months of 2014 and purchases by Japanese tourists continued to shrink. Spending by Russians also dropped by 3% as the flow of Russian tourist arrivals fell due to the political context. Finally, consumption by Middle Eastern clients increased by 11%, fed by growth in arrivals from the Middle East.
In terms of products, the upscale hotel segment benefits from steady growth in demand and posts progress by 9% (just behind the 10% growth of luxury vehicles). Those over 30 years of age who are seeking an upscale lifestyle experience also made it possible for the luxury cruise market to grow.
The worldwide luxury market is driven by the growth of international tourism and the emergence of the global middle classes. As consumers make more and more purchases outside their home country, a kind of consumer is emerging that Bain & Company qualifies as truly global.