After the highly exponential growth of the world of high-end luxury, there was a need for small businesses to move quickly to keep up, but it is also true that the trend is imploding for all production segments waiting for the financial market , also caused by the economic crisis in China which currently represents the main luxury purchasing market, can find a new growth balance. According to analysts, the moment is also very worrying because consumers in China are recognizing their own sense of taste identity and aesthetic sensitivity, a bit like what happened in Tokyo after the bursting of the economic bubble of the 80s.
Luxury goods such as super cars, watches, including fashion accessories, beauty products, represent the heart of the luxury market
This segment grew constantly until 2019, the year of the pandemic which affected the consumption of all kinds of goods. In 2022, despite a delayed COVID recovery especially in China, the market continued to grow 27% between 2020 and 2022. It seemed that the promise of growth could be constant but global economic uncertainties are now delaying this analysis, excluding of some brands like Hermes and some others that continue to give good signals. Otherwise, the market is contracting for various reasons: little creativity, too much exaggeration, little sustainability, reduced internationalization, reduction of the young target, focus only on high-users and fashion victims, unjustified increase in prices, without going into the merits of cases of capolarato or other alleged illegalities in production.
Traceable and environmentally friendly products are preferred
Now caring for the planet is becoming a crucial part of loyalty to luxury brands, especially in Europe, where shoppers are ready to spend more on environmentally friendly products, blending their traditional appeal with the power of the Internet and social media average. Influencers are also playing a significant role, using their online presence to make luxury brands seem more personal and relatable. In Europe, the concept of "green" is spreading in luxury shopping, with a figure approaching 80% of people looking for ecological products. We must certainly consider all this not as a passing phase but rather as a radical change in the meaning of luxury in the future.
Some examples from the fashion industry
European luxury brands are increasingly integrating sustainability into their operations and brand philosophies, showing a commitment to environmental responsibility alongside the traditional emphasis on quality and craftsmanship. For example, LVMH, an important French luxury group, launched Nona Source in April 2021, the first online resale platform for waste materials from the group's houses, effectively recycling high-quality fabrics that would otherwise go to waste. Another luxury fashion house which Chanel has long defined a precise plan with sustainability objectives. This financial instrument ties the bond's interest rates to the achievement of specific sustainability objectives, directly linking its financial instruments and sustainability performance. This shows that European luxury brands actively embrace sustainability, balancing the pursuit of excellence with responsibility towards the environment and society.
Importance of adopting an omnichannel strategy
Therefore next to one clear sustainability policy the luxury industry will increasingly have to marry the digital revolution. If luxury brands are now focusing on communicating the history and values of their brand they will then have to focus on the provision of “omnichannel” experiences” seamlessly. Online and mobile channels are expected to dominate, reaching a third of the market and driving a complete transformation. With these premises in next decade we will witness the fusion between tradition and technology, creating a new era of luxury which caters to a diverse and demanding global audience.
