Luxury Goods Market

Luxury Goods Market Size and Share:

The global luxury goods market size was valued at USD 286.10 Billion in 2024. Looking forward, IMARC Group estimates the market to reach USD 405.80 Billion by 2033, exhibiting a CAGR of 3.76% from 2025-2033. Asia Pacific currently dominates the market, holding a market share of over 39.8% in 2024. The market is primarily driven by increasing economic growth, changing consumer behavior, rising number of sustainability initiatives, rapid digitalization, expansion of resale market, and quality and exclusivity offered by luxury brands.

The expansion of the luxury goods market is significantly influenced by rising disposable incomes and increasing urbanization, particularly in emerging economies. As individuals' disposable incomes grow, they have more financial capacity to spend on non-essential items, including luxury goods. For instance, the United States leads globally with an average gross disposable income of $54,854 per household, followed by Luxembourg at $49,860 and Switzerland at $43,035. Urbanization plays an important part in this scenario. As more people migrate from rural to urban areas, they are exposed to higher living standards and consumer cultures that often emphasize luxury consumption. In China, a key emerging market, the urbanization rate was 66.16% at the end of 2023, with projections to approach 70% within the next five years. This combination of increased disposable income and urban living fosters a consumer base more inclined toward luxury goods, thereby driving the market growth.

The United States is emerging as a leading market, holding a total of 76.80% share. The growth of the luxury goods market in the United States is significantly influenced by the country's affluent consumer base, characterized by high disposable incomes and a strong inclination toward premium products. In 2033, the U.S. luxury goods market is expected to reach US$ 108.5 billion, expanding at a compound annual growth rate (CAGR) of 5.3% from 2024 to 2033. This robust growth is attributed to the substantial purchasing power of American consumers, who are increasingly investing in high-end personal luxury items. The jewelry market in the country reached $75 billion in 2023. It is expected to reach US$ 85.5 billion by 2032, growing at a rate of 1.2%. This trend is further supported by the expansion of luxury retail networks across the country, including single-brand boutiques and multi-brand stores in urban centers and upscale shopping destinations.

Luxury Goods Market Trends:

Experiential Luxury and Millennial Preferences

The market for luxury goods is changing as a result of the changing tastes of millennial buyers, which place an increasing focus on experience luxury as opposed to conventional material possessions. According to studies, millennials value experiences more than material possessions and are looking for unique opportunities to interact with brands. Moreover, as per the industrial report, by 2030, Gen Z will account for 25% to 30% of luxury market purchases, while millennials account for 50% to 55%. Numerous factors are driving the trend toward experience luxury. Special experiences that foster personal development and self-expression are highly valued by millennials. According to a survey by Eventbrite, 78% of millennials would rather spend money on experiences than tangible goods. Luxury travel packages, personalized lifestyle services, and invitation-only events are just a few of the immersive experiences that luxury firms are offering to capitalize on this trend.

Digital Transformation and E-Commerce Growth

The way that consumers find, interact with, and buy luxury goods is being completely transformed by the digital revolution in the luxury goods industry. As per industrial reports, the retail e-commerce sector grew by 16% in 2021, bringing in over USD 4.9 Trillion in sales globally. By 2025, this amount ought to expand by 50% to USD 7.4 Trillion. Access to luxury products has been more accessible due to the growth of social, digital technology, and e-commerce platforms. This has allowed firms to reach a worldwide audience and media offer customized shopping experiences. The luxury goods market is witnessing an exponential increase in sales due to e-commerce, which has emerged as a crucial development driver. Lockdowns and social distancing measures brought on by the COVID-19 pandemic further increased the trend toward online shopping by encouraging individuals to buy luxury goods through digital means.

Rising Affluence in Emerging Markets

The growing luxury goods market is mostly being driven by the rising affluence of merging economies, especially in areas such as Asia-Pacific. The number of high-net-worth individuals (HNWIs) and wealthy middle-class consumers has been gradually increasing as these regions' economies continue to grow. According to an industrial report, in 2020, the Asia-Pacific area surpassed Europe to account for 35% of global luxury consumption. China in particular has become a global leader in luxury spending due to the rapidly expanding middle class of the nation, which is boosting demand for high-end brands. This rise in affluence is fueled by factors such as urbanization, increasing disposable incomes, and a growing appetite for luxury lifestyles.

Luxury Goods Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the global luxury goods market, along with forecast at the global, regional, and country levels from 2025-2033. The market has been categorized based on product type, distribution channel, and end user.

Analysis by Product Type:

• Watches and Jewellery
• Perfumes and Cosmetics
• Clothing
• Bags/Purse
• Others
   

Watches and jewelry hold an approximate market share of 27.0% in 2024 primarily due to the following reasons. They are in demand continuously for wide demographics and cultures and, it is believed to be essential accessories for males as well as for females. In particular, watches are an essential accessory, which a lot of people use in their lives on a daily basis. Accordingly, the luxury watch market size is projected to touch US$ 36.8 Billion in 2032, at an estimated growth rate of 2.9% for the forecast period from 2024 to 2032, a new report by IMARC Group noted. These products rank amongst the fashion statement items as well as status symbols, for which consumers are ready to pay for.

Analysis by Distribution Channel:

• Offline
• Online
   

Online leads the market with about 32.5% market share in 2024 owing to the numerous benefits it avails and the change in consumer behavior. It makes it easier for both the business and the consumer, making a wide reach and accessibility of distribution methods towards online platforms. With the rise of e-commerce, businesses can now operate with lower overhead costs than traditional brick and mortar stores, reach a wider audience, and access a global market. Consumers are also becoming increasingly accustomed to using online channels because of their ability to provide a seamless buying experience, personalized recommendations, and efficient delivery services. The global e-commerce market will reportedly reach US$ 183.8 Trillion by 2032 at a growth rate of 27.16%, according to reports from IMARC GROUP.

Analysis by End User:

• Women
• Men
   

Women lead the market with around 60.5% of market share in 2024 due to their significant buying power and influence on consumer spending. According to HARWARD REVIEW, women control about $20 trillion in annual consumer spending, and this figure is expected to reach $28 trillion in the next 5 years. Additionally, women are becoming primary decision-makers in households globally. Besides this, women are also considered primary targets for various products and services, such as cosmetics, healthcare, and apparel. Moreover, the influence of women extends to numerous product categories.

Regional Analysis:

• North America
  • United States
  • Canada
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Others
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

In 2024, Asia Pacific is the largest market, holding over 39.8% of the market share, because of a number of reasons. Significant economic growth of the region has brought increased disposable incomes in the markets, especially in Japan, South Korea, and Japan, thereby making it a promising market for international and luxury brands. Additionally, the huge youth population in the region, particularly the age group of 15-24 years, is highly interested in buying luxury goods, which drives the market. The UN states that over 60% of the world's youth reside in Asia-Pacific, meaning more than 750 million young men and women are aged 15 to 24 years.

Key Regional Takeaways:

North America Luxury Goods Market Analysis

The North America luxury goods market is booming for several reasons, including the strength of the economy, the change in consumer behavior, and the growth of online retail platforms. The United States, along with other countries in North America, has one of the world's highest disposable incomes per capita. Economic affluence creates a strong consumer expenditure on luxury products. The region also enjoys a growing HNWIs and UHNWIs base, whose demand for luxury goods remains resilient. E-commerce is the most important factor in the growth of North America's market. Luxury brands use digital platforms to offer personal and seamless shopping experiences. Sustainability and transparency are also changing purchasing decisions, which forces luxury brands to adopt eco-friendly practices and highlight ethical sourcing.

United States Luxury Goods Market Analysis

There is a significant well-off population with high disposable incomes in the United States, which would like to indulge in the premium personal luxury accessories by top brands. The country also enjoys a robust retail network, with both single brand and multi-brand outlets placed at the right location, such as the high traffic areas including airports and shopping malls that provide access to a range of regional and international luxury goods.

Shifting consumer preferences toward premium and curated collections have led to the development of curated fashion stores targeting the changing tastes of U.S. buyers. Industry reports show that luxury-branded footwear is currently the most popular category, with 47.3% of adults reporting purchases in this segment. Handbags and leather goods, including purses, belts, and wallets, follow closely, with 46.2% of consumers making purchases over the last year. Cosmetics, fragrances, and other beauty products have also led to huge contributions, since 45.4% of users still patronize such luxuries.

Luxury brands are engaging themselves with this growing demand through the launch of exclusive collections and strategic collaborations. One such example is in May 2022, where Kering Group's Gucci joined hands with Adidas to launch a hybrid-pattern ready-to-wear clothing and accessory line that would be available both online and in select stores targeting discerning luxury consumers in the region.

Europe Luxury Goods Market Analysis

The European luxury goods market has demonstrated dynamic tradition and innovation in terms of heritage brands embracing new strategies to cope with changing consumers' demands. As per several industrial reports, luxury spending in Europe was reported at 24.6% in 2023, which further cemented the continent's position as one of the strongest luxury markets around the world. European consumers spent on average around USD 130 per capita on luxury goods, showing strong demand from the region.

Significant change, of course is online with luxury shifting and the same pattern repeats with the luxury shifts in Europe, as their luxury sectors are dominated largely by those firms such as LVMH, L'Oréal, Hermès and Dior that belong under their parent banner, LVMH and there is partial recovery also through tourism channels too. Indeed, the rising returns and prospects through international tourists now arrive significantly with substantial spends to the resort towns, major cities of luxury brands on earth.

Despite macroeconomic challenges affecting local aspirational buyers, high-net-worth individuals and top-tier customers have been the bright spot for the market, as their demand continues to keep the market momentum positive. An industry report stated that tourist spending by U.S. tourists in Europe increased 2.5 times between 2019 and 2023, and spending by Middle Eastern tourists increased 1.7 times during the same period. In general, tourist spending on luxury goods in Europe increased by 50% in 2022, thereby strongly driving market growth. International tourism together with local demand has made Europe a premium luxury destination in the global arena.

Asia Pacific Luxury Goods Market Analysis

The Asia-Pacific luxury goods market is an exciting and fast-moving industry that is the world's largest consumer base for luxury products. Growth in the region is mainly due to strong domestic demand and the revival of Chinese tourists traveling throughout Asia. Japan has seen high growth, fuelled by healthy local consumer spending and a weak yen, which has brought various tourists to the country. Meanwhile, Mainland China shows strong performance in the past quarter after the reopening; however, it has cooled down due to arising macro concerns. Moreover, as per the industrial report, generation Z is becoming an increasingly important demographic segment in developing Asia. By the year 2025, it is anticipated that Gen Z will make up at least 25% of the population in the Asia-Pacific area. For instance, the Gen Z demographic in China is projected to be 233 million, representing 13% of household spending. These factors are also boosting the demand.

Southeast Asia region, particularly Thailand, witnesses positive momentum based on healthy intraregional tourist traffic and an increasing share of local customers. Market is driven largely by the Chinese consumers segment, with high net-worth to low net-worth shoppers buying luxury goods from luxury to mass luxury. Between 2020 and 2022, domestic luxury spending has increased. During public holidays, Chinese consumers spend lavishly on luxury items in resort destinations like Hong Kong, Macau, and Hainan Island. Trends such as these underscore Asia-Pacific's important role in shaping the global luxury goods landscape.

Latin America Luxury Goods Market Analysis

The luxury market in Latin America has experienced remarkable growth, propelled by a convergence of economic, social, and cultural factors. This expansion spans diverse categories such as fashion, automobiles, jewelry, and luxury experiences. The market’s trajectory of sustained growth is attributed to rising wealth in select regions, economic stabilization in key countries, and increasing consumer interest in premium goods and experiences.

The growing upper-middle and high-income classes in countries like Brazil, Mexico, and Colombia have significantly boosted demand for luxury products and services. Luxury tourism further amplifies this trend, drawing affluent consumers to high-end offerings. Mexico has emerged as a dominant player in Latin America's luxury market, achieving an impressive 12% growth in 2023, as per an industrial report.

Also, according to industrial reports, the Mexican luxury market is distinctively skewed toward male consumers, with 64% of buyers being men over 36 from high-income groups. These consumers increasingly value experiences over material possessions, positioning experiential marketing as a vital strategy for capturing their interest.

Middle East and Africa Luxury Goods Market Analysis

The luxury goods market in the Middle East and Africa, particularly in GCC countries, is experiencing robust growth, driven by increasing consumer spending and strategic investments by global luxury brands. Over 50% of consumers in the region report an increase in their luxury spending, underscoring the market's rising affluence. Dubai continues to serve as the region's premier luxury hub, while Saudi Arabia emerges as a rapidly accelerating market with substantial untapped potential that is attracting significant investments from major luxury brands.

In response to growing demand, many high-end brands have intensified their focus on the region. In 2023 and 2024, luxury brands have strategically tailored their offerings to the local market by hosting localized fashion shows and collaborating with regional influencers to enhance their appeal. Additionally, flagship stores are being established in key luxury destinations such as Dubai and Abu Dhabi, enabling brands to cater to the region’s sophisticated and affluent clientele. These initiatives position the Middle East and Africa as a critical growth driver in the global luxury market.

Competitive Landscape:

Key players are adopting numerous methods to maintain growth, including joint ventures, introduction of novel products, and mergers and acquisitions to increase their market share. For instance, L’Oreal entered into an agreement with Prada S.p.A. to produce and distribute luxury beauty products. Besides this, companies are also concentrating on exclusivity, quality, and unique designs in order to cater to the rising demands of the consumers. Other than this, key players are extensively investing in research and development (R&D) activities in order to expand their product portfolios.

The report provides a comprehensive analysis of the competitive landscape in the luxury goods market with detailed profiles of all major companies, including:

• Chanel
• Compagnie Financière Richemont S.A.
• Gianni Versace S.r.l
• Giorgio Armani S.p.A
• Hermès International S.A.
• Kering S.A.
• LVMH Moët Hennessy Louis Vuitton
• Prada S.p.A.
• Ralph Lauren Corporation
• Rolex SA
• The Estée Lauder Companies Inc.
• The Swatch Group Ltd
• Valentino S.p.A.
   

Latest News and Developments:

• January 2024: Miu Miu, a label under Prada, introduced its fourth limited-edition collection of upcycled bags, named "Miu Miu Upcycled: Denim and Patch."
• September 2023: Richemont SA unveiled a new beauty division, called Laboratoire de Haute Parfumerie et Beauté.
• September 2023: Ralph Lauren broadened its footprint in Canada by opening its first luxury physical store and launching a dedicated e-commerce platform.
• June 2023: Kering Beauté (Kering) revealed that it has signed an agreement to acquire Creed, a prestigious heritage fragrance brand.
• April 2021: LVMH, Richemont, and Prada Group announced their partnership to launch a platform called Aura Blockchain Consortium 34. This platform will allow consumers to access and view the product history from its sourcing to sales. This strategic step has been taken to establish the authenticity of luxury goods.
• January 2021: LVMH Moet Hennessy Louis Vuitton SE announced the acquisition of global luxury jeweller, Tiffany & Co.

Luxury Goods Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the luxury goods market from 2019-2033.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the global luxury goods market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the luxury goods industry and its attractiveness.
• The competitive landscape allows stakeholders to understand their competitive environment and provides insight into the current positions of key players in the market.