Table of Contents
Executive Summary
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- Top takeaways: what luxury consumers want
- Market overview
- Impact of COVID-19 on the personal luxury goods market
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- Figure 1: Impact of COVID-19 on personal luxury goods, May 2021
- Opportunities and challenges
- Challenge: skeptics think luxury brands are not worth the steep price tag
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- Figure 2: Barriers to purchasing luxury brands, October 2020
- Opportunity: emphasize the high quality of luxury items
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- Figure 3: Percentage who agree luxury brands make high quality products, October 2020
- Challenge: consumers don’t have a reason to own luxury items
- Opportunity: encourage shoppers to treat themselves during pandemic recovery
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- Figure 4: Luxury purchase motivations, by gender, October 2020
- Challenge: luxury brands must compete with their own products on resale platforms
- Opportunity: join forces for greater control of the resale market
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- Figure 5: Attitudes toward purchasing luxury items online, October 2020
The Luxury Market – Key Takeaways
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- Personal luxury market suffered in 2020
- Luxury became a lower priority
- Affluent households’ spending power remains strong
- The pandemic hastened a shift to online shopping
Personal Luxury Goods Market Size
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- Estimated market size
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- Figure 6: Size of global luxury market, global personal luxury goods market and the Americas’ personal luxury goods market, 2019 and 2020
- Personal luxury goods
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- Figure 7: Estimated global sales of personal luxury goods by category, in billions of Euros, 2020
- Sales by market
- Forecast
Impact of COVID-19 on the Personal Luxury Goods Market
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- Figure 8: Impact of COVID-19 on personal luxury goods, May 2021
- Immediate impacts
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- Figure 9: Agreement that interest in luxury shopping has diminished, October 2020
- Short term
- Recovery
- Learnings from the last recession
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Market Factors
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- Economic factors
- Affluence is more concentrated among older adults
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- Figure 10: Distribution of household net worth, by age of householder, 2017
- K-shaped recovery
- Changes in disposable personal income
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- Figure 11: Disposable personal income change from previous period, January 2019-February 2021
- Consumer confidence edges upwards
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- Figure 12: Consumer confidence index, January 2015-March 2021
- Travel revival can boost luxury industry in 2021
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- Figure 13: Percentage who enjoy luxury shopping when they travel, October 2020
- Pandemic purchases shift online
- Fashion industry must reckon with decades of waste
Companies and Brands – Key Takeaways
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- During recovery, brands should cater to a post-pandemic mindset
- Take advantage of recent attention to supply chains
- Luxury brands have a chance to shape the future of luxury resales
- The fashion world is shifting online
Market Opportunities
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- Re-emergence is a reason for shoppers to treat themselves
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- Figure 14: Barriers to purchasing luxury brands, October 2020
- Focus on craftsmanship
- Appeal to wealthier consumers by showcasing artisans
- Brand spotlight: M.Gemi’s line of handbags
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- Figure 15: Instagram post with image of a Tuscan shoemaker, April 2021
- Accommodate comfort
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- Figure 16: Women’s sweatpants, April 2021
- Use sustainable materials
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- Figure 17: Iris van Herpen ~ Roots of Rebirth, January 2021
Competitive Strategies
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- Luxury resellers: if you can’t beat the competition, join them
- Digital promotion: selling virtual luxury
- Fashionable gaming
- Non-fungible fashion
- Gucci’s digital expansions
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- Figure 18: Gucci Off The Grid, October 2020
The Consumer – Key Takeaways
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- Luxury shoppers skew younger and male
- Men go for apparel, women spend on accessories
- Brands and logos help men express their identity
- Luxury items offer value through quality
- Online luxury shoppers want easy returns and the opinion of their peers
Brands Purchased
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- Wealthier shoppers are less likely to purchase luxury brands
- Chanel and Gucci top the list of luxury brands
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- Figure 19: Luxury brands purchased in the past two years, October 2020
- Luxury shoppers skew male
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- Figure 20: Luxury brands purchased in the past two years, by gender, October 2020
- Younger adults are drawn to luxury brands
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- Figure 21: Luxury brands purchased in the past two years, by age, October 2020
- The audience for luxury items is diverse
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- Figure 22: Luxury brands purchased in the past two years, race and Hispanic origin, October 2020
Items Purchased
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- Chanel and Dior lead for fragrance
- Beauty and skincare a weak area for Gucci and Louis Vuitton
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- Figure 23: Luxury items purchased in past two years, by brand, October 2020
- Male luxury buyers gravitate toward clothing and shoes
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- Figure 24: Luxury items purchased in past two years, by brand, among men, October 2020
- Luxury brand clothing not a top purchase among female luxury shoppers
- Louis Vuitton bags are must-haves for female luxury shoppers
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- Figure 25: Luxury items purchased in past two years by brand, among women, October 2020
Categories Where Brand Names Matter Most
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- Younger shoppers more likely to link brands to personal identity
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- Figure 26: Agreement that brands purchased illustrate who a person is, October 2020
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- Figure 27: Attitude toward wearing brand logos, October 2020
- Advanced age of the wealthy influences brand preferences
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- Figure 28: Categories where brand names matter to affluent and HNW consumers, October 2020
- Luxury shoppers say brands matter most for clothing and shoes
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- Figure 29: Categories where brand names matter, total adults vs luxury shoppers, October 2020
- Male luxury shoppers appreciate clothing and shoe brands
- Brand name BPC products appeal to middle-aged women
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- Figure 30: Categories where brand names matter, by age and gender, October 2020
Purchase Motivations
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- Perceived quality drives value of luxury products
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- Figure 31: Percentage who agree luxury brands make high-quality products, October 2020
- Quality also helps justify a luxury purchase as a treat
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- Figure 32: Luxury purchase motivations, October 2020
- Male luxury shoppers more driven by appearances than quality
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- Figure 33: Luxury brand attitudes, by gender, October 2020
- Women want to treat themselves with luxury
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- Figure 34: Luxury purchase motivations, by gender, October 2020
Buying Luxury Items Online
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- Most consumers want to see expensive items first
- Third-party sites have a steep hill to climb
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- Figure 35: Attitudes toward purchasing luxury items online, October 2020
- Male luxury shoppers are third parties’ best bet
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- Figure 36: Attitudes toward purchasing luxury items online, October 2020
- Reviews from other shoppers carry more weight than experts’
- Easy returns can encourage luxury shoppers to buy online
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- Figure 37: Improving online luxury purchase experience, October 2020
- Reaching luxury consumers online
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- Figure 38: TURF Analysis – eCommerce features, October 2020
Appendix – Data Sources and Abbreviations
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- Data sources
- Consumer survey data
- Abbreviations and terms
- Abbreviations
Appendix – The Consumer
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- Figure 39: Luxury items purchased in past two years, by brand, October 2020
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- Figure 40: Categories where brand names matter, by gender, October 2020
- TURF analysis: ecommerce features
- Methodology
- Output
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- Figure 41: TURF Analysis – eCommerce features, October 2020
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