Fashion and luxury will continue to grow, but more slowly than in the last 10 years. This is supported by the rating agency Standard & Poor's in its report entitled “Europe's Luxury Goods Industry Will Likely Cope Well With Ongoing Shifts In Global Demand”: the recovery of the mature economies will take place and the emerging markets will also continue to increase, but this will not be enough for the Italian and European fashion industry to rediscover its golden times. Except if your name is Armani, Prada or Ferragamo: because according to S&P's analysis, the most important and independent players will be able to continue to consolidate, and the polarization between the big players and the smaller ones could increase.
“The success story of several independent gamers, such as Prada, Ferragamo, Armani, Dolce & Gabbana, Max Mara, Trussardi, Tod's, and Zegna, to name just a few, shows that well-managed independent companies that produce great products are well positioned to continue to be successful and continue to grow,” underlined analyst Barbara Castellano, citing some of the most well-known Italian fashion houses.
In general, however, notes the US agency, growth will probably occur at a slower pace than the rapid increase recorded in the last 10 years, and competition from non-EU brands is likely to intensify. The key is always the same: too slow recovery in the old continent and China which is no longer growing as it did a few years ago, and which has slowed down demand. “Stagnation in Europe – explains the analyst – and the slowdown in demand from China have increased the attention of luxury companies on production and on maintaining a competitive advantage in their retail network. However, we believe that the luxury industry will continue to grow at a mid-single-digit pace, given growing demand from newer economies, coupled with favorable demographic trends in Europe."
However, the demographic aspect is only one of the aspects: in fact, luxury consumers make up less than 5% of the world population (about 330 million people, according to the consulting firm Bain & Company), and this figure includes both "true luxury" and the lower category called "premium". While the latter customer segment is larger, currently – and markedly with the crisis – it contributes much less to sales than true luxury consumers, who spend more on luxury goods.
