The Chinese luxury goods market is poised to claim 25% of the global market share by the year’s end, with projections indicating a potential increase to approximately 40% by 2030. This anticipated growth positions China to surpass Europe and the Americas, becoming the world’s largest luxury goods market.
Driven by a surge in the popularity of luxury brands and rising levels of affluence, China’s luxury market is forecasted to reach around $80 billion in 2023, marking an 8% year-on-year growth, according to a recent study conducted by consulting firm Deloitte in collaboration with Douyin, China’s counterpart to TikTok.
Tianbing Zhang, a partner at Deloitte, remarked, “In 2023, China’s luxury sector is demonstrating a robust recovery trajectory, solidifying its pivotal role in the global brand landscape. Our analysis indicates a maturing Chinese consumer base, where luxury items are increasingly valued not only as social symbols but also as assets for personal enjoyment and long-term investment.”
Several factors are expected to underpin this remarkable growth, including the spending patterns of high-net-worth individuals, the emergence of new demand from the post-90s generation, the expanded availability of online retail channels, and the effective fine-tuning of pricing, product offerings, and marketing strategies by luxury brands.
In terms of product categories, bags and suitcases comprise over one third (35%) of the total luxury goods market in China, followed by clothing at approximately 23%, and jewelry and watches at 19% and 15%, respectively.
Among the segments experiencing notable growth are jewelry, watches, and bags, with their appeal attributed to their investment potential, brand exclusivity, and versatile design elements, as highlighted by the report’s authors.
Preferences for purchasing luxury products often revolve around practicality for everyday use (49%), self-reward (47%), and stylish design (35%), according to the findings.
Chinese consumers also demonstrate a keen interest in understanding the brand narrative, with short videos and livestreams emerging as effective platforms for delivering authentic content and engaging storytelling.
Moreover, the report emphasizes the importance for luxury brands to curate immersive “luxury experiences” across both physical and online channels to meet evolving consumer expectations and remain competitive in the digital era.
“While online platforms and digital experiences are reshaping consumer behavior in China, luxury brands must strive to meet heightened consumer expectations to stay relevant in the competitive landscape,” the report concludes.
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