After a difficult period, the luxury sector is starting to recover, driven by consumers' willingness to spend heavily on high-end fashion items once again. However, players in the luxury sector will have to deal with new consumer expectations relating to sustainability and the transformation of the shopping experience, a new study reveals.
After a momentary standstill due to the pandemic, the luxury sector -- and, more precisely, the luxury fashion sector -- is getting back on track, as revealed by the latest Vogue Business Index . In any case, the consumers concerned seem ready to return to stores -- or the internet -- to spend heavily on luxury goods. According to the report, 16% of luxury consumers plan to increase their spending in the next six months, up from 9% last fall.
Millennials and Gen Z are the two age groups that plan to increase their luxury spending the most in the next six months. Nearly one-fifth (19%) of Gen Z luxury buyers plan to increase their luxury fashion spending today, compared to just 11% at the end of 2020. The report also reveals that luxury fashion will be able to count on Gen Z buyers in the US, UK and South Korea, in particular.
A cross-channel shopping experience
After having massively turned to e-commerce due to the closure of physical stores during the pandemic, consumers now expect a reinvented shopping experience, integrating all sales channels, and even making them complementary, for a cross-channel experience. For example, this could involve shoppers being able to order online and pick up their purchases in stores. This is a demand to which players in the luxury sector will have to adapt quickly -- if they haven't already done so -- and which requires optimal services, including (fast) delivery, which appears to be essential for a large majority of the luxury consumers polled.
Another finding is that sustainability seems to have become a significant purchasing criterion for buyers of luxury fashion items. Nearly two-thirds (62%) see it as an important factor when purchasing this kind of product. In the same vein, workers' rights are another issue to which consumers are paying close attention.
In the ranking of the world's biggest luxury fashion brands, Louis Vuitton once again comes out on top, overall, while Gucci is a hit with Gen Z.
The data presented in the Vogue Business Index is based on a survey of luxury consumers (with an annual luxury fashion spend over $2,500), conducted between March and May 2021, and including input from more than 7,000 consumers across 13 markets.