Study: Luxury Customers Coming Back

A new study by Bain and Co. predicted that luxury consumers will soon start spending the same way they did before the financial crisis.

The group’s “Spring 2011 Update: Luxury Goods Worldwide
Market Study” forecast that luxury sales in the Americas will raise eight
percent this year. Worldwide luxury sales are also predicted to rise eight
percent.

While the U.S. remains the world’s largest luxury market, it
noted that high-end marketers are increasingly turning their attention
overseas, particularly to China, which will see 25 percent year-over-year
growth this year.

Other attractive overseas markets include Russia (which
should see to 5 to ten percent annual growth), Brazil  (10 percent to 15 percent), and the Middle East
(10 percent to 12 percent).

The group also predicted the luxury market in Japan will see
declines of five percent, mostly due to the impact of the recent earthquake.
However, the Bain study estimates that Japan’s luxury sales will stabilize in
the third quarter of 2011, noting that some brands have already seen a
resumption in purchases.

 The study concludes
there are three keys to the future of luxury goods:

  • A focus on emerging markets
  • Adaptation to the continuing generational shift, with baby-boomers
    retiring, and “more connected” generations coming up
  • Continuous enhancement of the customer experience

Don’t miss a story! Subscribe to JCK’s e-newsletter here.