Despite pandemics, wars and recessions, the luxury retail market is actually growing. The rising number of high net worth individuals and mass affluent globally is the key driver behind rapid expansion of the luxury retail market. This new data comes from global research by Communications Specialist Ltd.
Its study with senior executives at luxury retailers with total annual turnover of $3.1 billion across Asia, Africa, Europe, the US and South America found they are forecasting annual growth of more than 5.6% for the luxury retail sector over the next three years.
Senior executives that were questioned about this said the growth as due to high net worth individuals and mass affluent people across the world as the biggest reason for rising sales.
Around 80% of executives said growing wealth globally is boosting sales while more than half (53%) pointed to improved performance by luxury retailers and pent-up demand following the COVID-19 pandemic. Around a third (31%) say increased sales are because of more personalized offers from luxury retailers for clients.
The combination of factors is undoubtedly translating into higher sales – almost all (96%) questioned believe revenues at their firm will be higher this year than in 2022. More than a fifth (22%) expect revenues to be 50% higher this year.