Demand for luxury goods is expected to be flat in 2024 at constant exchange rates, according to the firm.
Since 2022, luxury brands have lost more than 10 per cent of their usual customer base, Xinhua quoted the The Wall Street Journal report on Wednesday.
“It is the first time in memory that the sector’s shopper numbers have shrunk,” said the report. “For the past three decades, brands have focused on attracting new middle-class consumers to expand their sales — a ‘democratisation’ of luxury that helped triple the size of the business.”
“Price increases have reversed this long-term trend,” noted the report. The cost of the average luxury product has risen sharply since the start of the pandemic, albeit with big variations across brands. “Some customers would have pulled back anyway as inflation ate into their disposable incomes. But millions of others have been priced out.”
Expensive brands aren’t only selling to fewer people, they are selling far fewer products. The number of units sold by the luxury industry this year is expected to be 20 per cent to 25 per cent lower than in 2022, according to Bain.
