Bain & Company jointly with the Fondazione Altagamma presented a study of the market for personal luxury goods, which predicts its decline this year by 20-35% depending on the speed of the already started recovery. A return to the level of 2019 will take two to three years, and the future market will largely depend on the ability of his players to change in accordance with the changing perceptions and demands of consumers.Bain & Company and the Foundation for Italian manufacturers of luxury goods Fondazione Altagamma presented on Thursday, may 7th, the spring update of its global study on commodity market of personal luxury for 2020.The good news is that consumers, primarily in China, gradually began to return to shopping after the liberalization or abolition of quarantine measures. The market starts the road to recovery, despite the fact that in the first quarter, a decline of about 25%, and in the second, according to analysts Bain, the decline will accelerate. Depending on the recovery rate of the final reduction of the market by the end of the year will be from 20% to 35%.More good news — the full recovery of the market is not so far away. In 2019, the market volume reached €281 billion, this year it will be reduced to €180-200 billion In the years 2022-2023 Bain analysts expect renewed growth to €275-285 billion, and by 2025, the market will reach €320-330 billion Saviors and the main engines of the market will remain the Chinese: as stated in the report, they are in 2025 will account for almost 50%. European and North American markets of luxury goods will suffer the most and will recover longer.The major news is that after pandemics, the market is seriously changed in accordance with customer expectations. “The luxury market will recover, but the industry is waiting for a deep transformation. The crisis caused by the coronavirus, would force the industry to think more creatively and to innovate faster in order to satisfy a large number of new user demands and restrictions on channels of sales,” said Bain partner and main author of the study Claudia D Aspicio.The most important of these changes is the continued growth in online sales. According to Bain, in the first quarter, online sales increased significantly with a sharp drop in sales in physical stores. By 2025, analysts say, 28-30% of sales will occur online, compared to only 12% last year. Will be online by this time the main sales channel, surpassing even the mono-brand boutiques, high-end still: they will account for 26-28% of sales versus 31% in 2019. The purchase of travel in the medium term will return to previous levels (5-7%). As analysts Bain, the growing popularity of online trading luxury items is associated among other things with the that by 2025 the main buyers in this market will become members of generations Y and Z. If in 2019 they accounted for 39% of the market, then by 2025 the proportion will rise to 50-60%.Among other changes in this market, who predicts Bain, a greater attention of consumers to the safety and also to environmental and social components, their interest in local brands. Bain analysts also expect a greater polarization of consumers, in terms of costs and relationship to luxury goods, so brands will need to develop products in different price categories and for different audiences. In addition, customers will increasingly expect from the trip to the store or shop online of exciting experiences and positive emotions.Ian Christmas, Andrew Kulekeev
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