A rose by any other name might smell as sweet, but when it comes to luxury goods, the name matters almost as much as the design, the feel and anything else that goes into a designer handbag. However, it seems like consumers around the world aren’t all impressed by those trappings of luxury goods.
According to a study conducted by Bain & Co. and Altagamma, the Italian luxury confederation, luxury good sales are expected to grow over the course of 2016, but where that growth occurs will differ based on regions, Reuters reported. Bain and Altagamma have pegged luxury sales to grow to a maximum of 2 percent, but the fastest-growing locale — Japan — could see numbers up to 5 percent thanks to a growing Asian tourism scene.
The rest of Asia, however, isn’t expected to see such a surge in luxury spending. Mainland Asian markets are projected to rebound from a several-year lull but not enough in places like Hong Kong and Macao to post a solid figure in the black.
Claudia D’Arpizio, partner at Bain, identified China and its biggest Western trading partner as the two locations to watch for luxury good sales.
“All eyes are turned towards China, key in guiding the relaunch (of the sector), and on the recovery of the United States, where currently local consumption is not able to counterbalance the absence of tourism spending,” D’Arpizio told Reuters.
China should see a strong return to luxury sales prominence, at the very least, by 2020, when the report estimates that Chinese consumers will comprise 34 percent of the worldwide luxury demographic. A growing middle class that should bring 40 million newly monied shoppers to China should keep the region’s sales growth continuing far beyond 2020.
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