Total worldwide sales of luxury goods may exceed $302 billion this year, or about $5.8 billion per week. Worldwide sales this year are up about 4% from 2011 levels, when the US bought over $72 billion, compared with almost $18 billion in China. It also represents a 22% increase since 2007.
The researchers said the emerging upper- and middle-class population of fast-developing BRIC nations (Brazil, Russia, India and China) will by and large take the place of those in currently higher-ranked developed countries (the Eurozone and Japan) where economic troubles will reduce buying power.
Buyers in BRIC nations presently account for 11% of overall luxury sales, paying over $33 billion at retail for luxury goods this year. Five years earlier, those nations together accounted for just 4% of the world’s luxury goods market. By 2017, the BRIC nations are predicted to make up 16% of the total luxury goods market, buying $59 billion worth of high-end lifestyle products.
While Euromonitor foresees the Chinese luxury goods market growing by an annual average of 15% by 2017, it forecasts India’s much smaller market for luxury goods will grow even faster. For India, the research group is predicting a 22% average annual growth rate in luxury goods purchases.
Right now, the four nations purchasing the most luxury goods are, in order, the United States, Japan, Italy and France. Together they make up nearly half of the world’s luxury goods sales. The US alone accounts for over a quarter of the world’s luxury goods purchases. Second-place Japan’s luxury goods purchases have been falling and this year are estimated to be down 11% over the last five years, to about $32 billion.
Economic troubles and consumer retrenchment are responsible for cutting the leading nations’ share of the overall market. The Euromonitor report cited rising prices and growing worries over employment and pensions as factors helping depress luxury-good purchases in Western nations and Japan.
By 2017, designer apparel is expected to account for 42% of total luxury goods sales, with major gains also predicted for luxury jewelry and watches. With precious metal price increase pushing price points upward, the category is projected to account for 20% of total luxury goods sales within five years.