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LUXURY GOODS RETAIL - INTERNATIONAL - AUGUST 2019

Published By :

Mintel

Published Date : Aug 2019

Category :

Retail

No. of Pages : N/A

The global luxury goods market resisted some major headwinds in 2018, with ongoing political and economic uncertainty in a number of the key markets, as well as a decline in the population of High Net Worth Individuals. In spite of these challenges, consumer demand has remained robust and the leading players have continued to perform well. However, a slowing global economy could subdue demand going forwards, which will create a more challenging environment for luxury goods brands and retailers.

Table of contents

OVERVIEW
What you need to know
Products covered in this Report
Report scope
Mintel market sizes
Defining luxury goods
Product breakdown
Geographical breakdown
Company profiles
Technical notes
Financial definitions
Exchange rates
Figure 1: US Dollar to Euro annual average exchange rates, 2012-18
EXECUTIVE SUMMARY
The market
Growth in the luxury goods market accelerated in 2018
Figure 2: Luxury goods market size, reported and total retail sales and forecasts (excl VAT), 2014-24
Asia Pacific continues to capture a bigger share of the market
Figure 3: Luxury goods, sales by region, 2009-18
Fashion and leather goods is the best performing category
Figure 4: Global luxury market by type of product, 2018
The consumer
Fewer consumers buying luxury goods in Germany
Figure 5: Consumers who have bought luxury goods in the last 18 months, April/May 2015, May/June 2016, May/June 2017, June/July 2018 and June 2019
Beauty, clothing and footwear most purchased
Figure 6: Types of luxury goods bought in the last 18 months, June 2019
Rising number of consumers shopping online
Figure 7: Where luxury goods were bought in the last 18 months, June 2019
Consumers in China are boycotting brands
Figure 8: Luxury consumer behaviours, June 2019
Frequency is important to luxury shoppers
Figure 9: Attitudes towards luxury goods, June 2019
Companies and brands
Market shares
Figure 10: Top 10 luxury goods groups, share of all luxury goods sales, 2018
Online growth continues to outpace the wider market
Innovation focused on young consumers
What we think
Influence of new creative leaders
Beauty facing masstige competition
The need to be sustainable and inclusive
Frequent range updates in demand
ISSUES AND INSIGHTS
The changing face of luxury
The facts
The implications
The importance of innovation
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Slowing economy could subdue future growth
Fashion and leather goods continue to perform well
Recovery in Americas and Far East takes hold
A decline in the HNWI population threatens market
MARKET SIZE AND FORECAST
The global economy
Mintel’s market size methodology
The switch to retailing
Mintel’s market size and forecast
Figure 11: Luxury goods market size, reported and total retail sales and forecasts (excl VAT), 2014-24
PRODUCT SEGMENTATION
Mintel’s segmentation methodology
Market size breakdown
Figure 12: Global luxury market by type of product, 2018
Figure 13: Global luxury market, sales by product, 2009-18
Fashion and leather goods
Figure 14: Global luxury market: fashion and leather goods sales, 2014-18
Figure 15: Top 10 leading luxury goods companies by share of the fashion and leather goods sector, 2018
Jewellery and watches
Figure 16: Global luxury market: jewellery and watches sales, 2014-18
Figure 17: Top 10 leading luxury goods companies by share of the jewellery and watches sector, 2018
Perfumes and cosmetics
Figure 18: Global luxury market: perfumes and cosmetics sales, 2014-18
Figure 19: Top 10 leading luxury goods companies by share of the perfumes and cosmetics sector, 2018
REGIONAL BREAKDOWN
Mintel’s segmentation methodology
Market size breakdown
Figure 20: Luxury goods, sales by region, 2014-18
Share of market by region
Figure 21: Regional share of the luxury goods market, 2018
Figure 22: Luxury goods, percentage of sales by region, 2009-18
Country market sizes
Spend per capita
Figure 23: Wealth per HNWI by region, 2018
Luxury spending by country
Figure 24: Top 10 luxury goods markets, 2014-18
Figure 25: Top 10 countries in the luxury goods market by share of luxury spending, 2014-18
Americas
Figure 26: The Americas: leading luxury goods markets, 2014-18
Figure 27: The Americas, luxury markets’ shares of all luxury spending in the Americas, 2014-18
Asia Pacific
Figure 28: Asia Pacific: leading luxury goods markets, 2014-18
Figure 29: Asia Pacific luxury markets’ share of all luxury spending in the Asia Pacific region, 2014-18
Europe
Figure 30: Europe: leading luxury goods markets, 2014-18
Figure 31: European luxury markets’ share of all luxury spending in Europe, 2014-18
MARKET DRIVERS
Economic background
Figure 32: GDP growth in real and constant prices, 2015-19
Global uncertainty: The trade war between the US and China
Global uncertainty: Brexit
Currency
Figure 33: Leading international currency exchange rates, 2008-19
The who, where and why of the luxury goods consumer
Who?
High Net Wealth Individuals (HNWIs)
Figure 34: Numbers and share of wealth of HNWIs, 2018
HNWIs: Regional view
Figure 35: Number of HNWIs by region, 2009-18
Figure 36: Wealth of HNWIs by region, 2010-18
Figure 37: Top 10 largest HNWI populations, 2017 and 2018
HENRY joins the party
Where?
Shopping channels
Figure 38: Retailers used to buy luxury goods in the last 18 months, June/July 2018
Buying outside of the home market
Figure 39: International inbound tourism, 2005-18
THE CONSUMER – WHAT YOU NEED TO KNOW
Technical note
Demand stable in most regions
Product preferences vary by market
Rising online penetration
Sustainability concerns boosting the resale market
Young luxury shoppers demand more
WHO BUYS LUXURY GOODS
Stability in the market
Figure 40: Consumers who have bought luxury goods in the last 18 months, April/May 2015, May/June 2016, May/June 2017, June/July 2018 and June 2019
Young drive the Chinese luxury market
Figure 41: China: consumers who have bought luxury goods in the last 18 months, by gender, age and monthly household income, June 2019
Men remain more engaged
Figure 42: Consumers who have bought luxury goods in the last 18 months, by gender, June 2019
Purchasing influenced by age globally
Figure 43: Consumers who have bought luxury goods in the last 18 months, by age, June 2019
Affluence inevitably also plays a part
Figure 44: Europe: consumers who have bought luxury goods in the last 18 months, by monthly household income, June 2019
Figure 45: US: consumers who have bought luxury goods in the last 18 months, by annual household income, June 2019
Figure 46: UK: consumers who have bought luxury goods in the last 18 months, by annual household income, June 2019
WHAT THEY BUY
Changes in luxury purchasing
Figure 47: Types of luxury goods bought in the last 18 months, June 2019
Figure 48: Breakdown of the types of luxury goods bought in the last 18 months, June 2019
Luxury customer profiles by country
China: Bags popular amongst affluent consumers
Figure 49: China: types of luxury goods bought in the last 18 months, by monthly household income and age, June 2019
Italy: Older shoppers drive luxury fragrance purchasing
Figure 50: Italy: types of luxury goods bought in the last 18 months, by monthly household income and age, June 2019
US: Footwear popular amongst less affluent buyers
Figure 51: US: types of luxury goods bought in the last 18 months, by annual household income and age, June 2019
Spain: Jewellery and watch purchasing driven by young
Figure 52: Spain: types of luxury goods bought in the last 18 months, by monthly household income and age, June 2019
UK: Affluent more likely to buy luxury childrenswear
Figure 53: UK: types of luxury goods bought in the last 18 months, by annual household income and age, June 2019
France: An appetite for prestige beauty amongst older consumers
Figure 54: France: types of luxury goods bought in the last 18 months, by monthly household income and age, June 2019
Germany: Luxury fragrance buyers age the customer profile
Figure 55: Germany: types of luxury goods bought in the last 18 months, by monthly household income and age, June 2019
WHERE THEY SHOP
Most luxury buyers shop at home
Figure 56: Where luxury goods were bought in the last 18 months, June 2019
A decline in domestic purchasing in China and the US
Figure 57: Where luxury goods were bought in the last 18 months, in-store in home country, May/June 2017 and June 2019
Fewer British tourists are buying luxury goods abroad
Figure 58: Where luxury goods were bought in the last 18 months, in-store abroad, May/June 2017 and June 2019
France is the primary destination for Chinese luxury shoppers
Figure 59: China: where consumers bought luxury goods abroad in the last 18 months, June 2019
More US luxury consumers shopping online
Figure 60: Where luxury goods were bought in the last 18 months, online, May/June 2017 and June 2019
LUXURY CONSUMER BEHAVIOURS
Resale market gaining momentum
Figure 61: Luxury consumer behaviours, June 2019
Discount purchasing is common
Figure 62: Luxury consumer shopping behaviours, June 2019
China: Young are willing to boycott brands
Figure 63: China: luxury consumer behaviours, by age, June 2019
Europe: Young men are particularly savvy
Figure 64: Europe: luxury consumer behaviours, by age and gender, June 2019
US: Renting peaks amongst 25-34s
Figure 65: US: luxury consumer behaviours, by age, June 2019
UK: Second-hand buying strongest amongst older millennials
Figure 66: UK: luxury consumer behaviours, by age, June 2019
ATTITUDES TOWARDS LUXURY GOODS
Sustainability efforts lack conviction
Figure 67: Attitudes towards luxury goods, June 2019
China: Young deterred by prolific discounting
Figure 68: China: attitudes towards luxury goods, by age, June 2019
Europe: Older consumers want more provenance
Figure 69: Europe: attitudes towards luxury goods, by age, June 2019
US: Demand for diversity amongst young
Figure 70: US: attitudes towards luxury goods, by age, June 2019
UK: 24-44s driven by experiences
Figure 71: UK: attitudes towards luxury goods, by age, June 2019
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Aggregate sales up in all regions in 2018
Acquisitions provide a boost to revenues
Leading players strengthen their position
Online is becoming more important
Young shoppers are shaping the industry
COMPANY METRICS
Figure 72: Leading luxury companies, by net revenues, 2016-18
Revenue growth rates
Figure 73: Leading luxury companies, % CAGR in revenues, 2013-18
Product revenue mix
Figure 74: Leading luxury companies, revenue by product group, 2018
Figure 75: Leading luxury companies, revenue by product group (continued), 2018
Figure 76: Leading luxury companies, percentage point change in product mix by product group revenue, 2014-18
Regional revenue growth
Figure 77: Leading luxury companies, total revenue by region, 2014-18
Store numbers
Figure 78: Selected leading luxury retailers, estimated store numbers, 2018
Brand ownership
Figure 79: Brand ownership, by leading luxury companies, 2019
MARKET SHARES
Consolidation in the luxury goods market
Figure 80: Top 10 luxury goods groups’ shares of all luxury goods sales, 2018
Figure 81: Top 20 luxury goods groups, share of all luxury goods sales, 2016-18
ONLINE AND SOCIAL MEDIA
The market
The outlook
The allure of luxury e-commerce
An opportunity for online growth in India
The brands online
Figure 82: Major luxury brands: Number of markets with transactional websites, 2016-19
Pureplay luxury e-tailers
Social media
Get with the program! How luxury brands are using WeChat’s Mini Programs
Check out Instagram’s latest feature
LAUNCH ACTIVITY AND INNOVATION
Upping the ante on sustainability
Animal welfare becomes a priority
New ways to boost customer experience
Pop-ups create hype
Paying homage to brand heritage
Virtual try-before-you buy
Challenging luxury
Ongoing brand extension
New stores focus on the next generation
GIORGIO ARMANI
What we think
Brand restructuring should improve sales with wholesale accounts
Exploring growth through pop-up shops
What next?
Company background
Company performance
Figure 83: Giorgio Armani: group financial performance, 2012-18
E-commerce
BURBERRY GROUP
What we think
New contemporary logo to reflect new vision and repositioning strategy under new chief creative director
Collaborations
Reducing in-store technology
Internationals Women’s Day
Ramps up sustainable and eco-credentials
Company background
Company performance
Figure 84: Burberry Group Plc: Group financial performance, 2014/15-2018/19
Figure 85: Burberry Group Plc: revenue by product division, 2014/15-2018/19
Figure 86: Burberry Group Plc: outlet data, 2014/15-2018/19
E-commerce
HERMÈS
What we think
The Chinese hunger for luxury
Pop-up shops offering personalisation
The face of Hermès cosmetics and skincare
Plastic-free packaging on upcoming cosmetics and skin care
What next?
Company background
Company performance
Figure 87: Hermès: financial performance, 2014-18
Figure 88: Hermès: sales by product category, 2016-18
Q1 2019
E-commerce
KERING
What we think
Flagship Gucci brand experiencing slower growth
Revitalised in-store shopping experience helping drive directly-operated store sales
Stepping up its own digital operations and taking e-commerce in-house
Moving towards a more sustainable and eco-friendly luxury fashion house
Company background
Company performance
Figure 89: Kering: Financial performance, 2014-18
Figure 90: Kering Luxury: Breakdown of revenue by region, 2013-18
Figure 91: Kering Luxury: Directly-operated stores, 2017-18
E-commerce
ESTÉE LAUDER
What we think
Estée Lauder showcases latest research into anti-ageing
Estée Lauder expands its Animal Welfare Partnerships
Estée Lauder raises outlook of Leading Beauty Forward initiative
Company background
Company performance
Figure 92: Estée Lauder Companies: group financial performance, 2013/14-2017/18
Figure 93: Estée Lauder Companies: Group financial performance, by region, 2013/14-2017/18
Figure 94: Estée Lauder Companies: Group financial performance, by product category, 2013/14-2017/18
E-commerce
RALPH LAUREN
What we think
Social media celebrities to woo high-spending younger consumers
Accelerating push into streetwear to win over millennials
Bricks-and-mortar expansion focused on China
Pushing further into the digital space
New commitment to boost eco-friendly credentials
Company background
Company performance
Figure 95: Ralph Lauren Corporation: Group financial performance, 2014/15-2018/19
Figure 96: Ralph Lauren Corporation: Global directly-operated stores and concessions, 2014/15-2018/19
E-commerce
L’ORÉAL LUXE
What we think
L’Oréal launches AI powered Mobile Acne Analysis App with Alibaba
L’Oréal revolutionises the plastic lifecycle with Carbios
L’Oréal confirms exclusive negotiation for acquiring Mugler and Azzaro
Company background
Company performance
Figure 97: L’Oréal group: net revenues b division, 2014-18
Figure 98: L’Oréal Luxe: financial; performance, 2014-18
E-commerce
LVMH
What we think
A diverse and balanced group
Acquisitions and launches boost diversity
Digital is the future
Commitment to France
What next?
Company background
Company performance
Figure 99: LVMH Group: financial performance, 2014-18
Figure 100: LVMH: Distribution of luxury revenues by region, 2014-18
Figure 101: LVMH: geographic distribution of total revenues by product category, 2014-18
Wholesale/retail
Figure 102: LVMH: sales by type of distribution, 2014-18
Figure 103: LVMH: outlet portfolio, 2017 and 2018
Figure 104: LVMH: Store numbers by Maison (division), 2018
Brands
Figure 105: LVMH: Brands by ‘Maisons’, 2019
E-commerce
PRADA GROUP
What we think
Shaping a digital future for Prada
Partnerships with e-tailers
Investing in a sustainable and environmentally-friendly makeover
Prada stops end-of-season markdowns to protect its brand
What’s next?
Company background
Company performance
Figure 106: Prada: group financial performance, 2013-18
Figure 107: Prada: group net revenues breakdown, by channel, 2013-18
Figure 108: Prada: group net retail revenues breakdown, by brand, 2013-18
Figure 109: Prada: group net retail revenues breakdown, by region, 2013-18
Figure 110: Prada: group net retail revenues breakdown, by product line, 2013-18
Figure 111: Prada: directly operated stores, 2013-18
E-commerce
RICHEMONT
What we think
YNAP’s post-Richemont acquisition figures send out mixed messages
YNAP acquisition will boost online presence of Richemont’s other brands
Being part of Richemont opens up access to more brands for YNAP
Partnership with Alibaba takes Richemont deeper into China
What next?
Company background
Company performance
Figure 112: Richemont: group financial performance, 2014/15-2018/19
Figure 113: Richemont: revenues by region, 2014/15-2018/19
Figure 114: Richemont: revenues by product, 2014/15-2018/19
Figure 115: Richemont: revenues by maison, 2014/15-2018/19
Figure 116: Richemont Group: outlet numbers and transactional websites, 2017/18-2018/19
Figure 117: YNAP Group: group financial performance, 2015-2018/19
SHISEIDO
What we think
Shiseido partners with Alibaba to accelerate growth
Shiseido ups its green efforts
Shiseido launches IoT skincare service, Optune
Integrating foundation and medicated skincare
Company background
Company performance
Figure 118: Shiseido: group financial performance, 2014/15-2018
Figure 119: Shiseido: Group Financial performance, by region, 2014/15-2018
Figure 120: Shiseido: Group sales performance, by region, 2017-18
Q1 2019
E-commerce
SWATCH GROUP
What we think
Growth expected to continue across all product ranges
Swatch Group withdraws from Baselworld to hold its own fair in 2019
After success in China, Swatch Pay contactless payment comes to Switzerland
Positive outlook in spite of potential turbulence from the Chinese market
Where next?
Company background
Company performance
Figure 121: Swatch Group: financial performance by brand, 2013-18
Figure 122: Swatch Group: net sales by region, 2013-18
Figure 123: Swatch Group: watches and jewellery segment, financial performance, 2013-18
Retail operations
E-commerce
TAPESTRY
What we think
Building a house of brands
Expanded product offering sales offsetting sluggish women’s handbag revenue
Maximising opportunities with Chinese consumers
Reducing its environmental impact
Company background
Company performance
Figure 124: Tapestry Inc.: Group financial performance, 2013/14-2017/18
Figure 125: Tapestry Inc.: Net sales, by region, 2013/14-2017/18
Figure 126: Tapestry Inc.: Product sales breakdown, 2013/14-2017/18
Figure 127: Tapestry Inc.: Directly-operated stores, 2013/14-2017/18
E-commerce
TIFFANY & CO.
What we think
Continuous investment in marketing and public relations
Stronger presence in digital and social media
Selling through emotions
Serious about diamond sourcing
What next?
Company background
Company performance
Figure 128: Tiffany & Co., sales performance by jewellery category, 2018/19
Figure 129: Tiffany & Co.: group financial performance, 2013/14-2018/19
Figure 130: Tiffany & Co.: company-operated stores and estimated sales per outlet, 2013/14-2018/19
E-commerce
TOD’S GROUP
What we think
More frequent product launches and collaborations
Directly-operated store sales bounce on back of new boutique concept
Maximising digital opportunities with newly acquired e-commerce business
Company background
Company performance
Figure 131: Tod’s Group: Financial performance, 2014-18
Figure 132: Tod’s Group: sales, by region, 2017-18
Figure 133: Tod’s Group: Sales by product type, 2017-18
Figure 134: Tod’s Group: Sales, by brand, 2017-18
Breakdown of sales by distribution channel
Figure 135: Tod’s Group: sales by distribution channel, 2017-18
E-commerce
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Data Sources
Abbreviations

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