Evolving Trends in Global Luxury Market
By Dr. Sheetal Jain
Over the last decade, global luxury industry is witnessing rapid changes due to shift in focus from class to mass; traditional media to social media; offline to online; Baby Boomers to Generation Y; developed markets to emerging markets; physical possessions to experiential value – to name a few. However, how these evolving trends will influence the luxury industry in the years to come is a question for now!
Let’s have a close look at some of the changing trends in Global Luxury markets and its implications on global luxury marketers.
Millennials to Rule the Luxury Market: Gone are the days when luxury was the monopoly of ‘elite few’ who grew with silver spoon and inherited the old money. Over the years, the luxury consumer base has evolved. Now the time has come to shift the focus from baby boomers to millennials. Luxury brands no more see growth opportunities in targeting your grandparents rather they see potential in new age buyers who aspire to buy high-priced designer labels. A recent report by Bain & Co. revealed that millennials are set to constitute 40% of world-wide luxury market across all personal luxury goods categories by 2025. Middle class population in countries including China and India are estimated to add 50 million new users to existing luxury market. This has made it imperative for luxury marketers to come up with affordable and accessible luxury items to tap this growing market segment.
Drive for experience based spending: Today, millennial generation looks life through a different lens. They value experiences more than physical products. Marketers can no longer win them by just selling a product rather they need to create an experience with them. Today’s youth think of spending on a lavish holiday or on front row seats to watch live concert of their favorite celebrity rather than on buying a home or a car. A recent study by Harris Group revealed that around 70% of affluent millennial population prefers to spend more on experience rather material possessions.
Digitalization: The new mantra of success in luxury marketing is going digital. According to a recent research, 95% of luxury consumers are digitally connected and around 75% of luxury purchases are affected by atleast one digital touch point. In the coming years, it will be critical for the marketers to create a unique, integrated, bespoke online experience for their luxury consumers.
These are few upcoming trends in global luxury market which will redefine the future of luxury market.