What: Global luxury spending is expected to remain flat at nearly EUR 1.5 trillion in 2024, with minimal growth as consumers shift focus from products to experiences.

Why it is important: This trend signals a shift in consumer priorities, compelling luxury brands to adapt by focusing on personalised experiences and creativity to retain their customer base, especially among younger consumers.

A report by Bain & Company and Altagamma forecasts that global luxury spending will reach nearly EUR 1.5 trillion in 2024, showing little growth compared to 2023. This stagnation is attributed to consumers prioritising luxury experiences such as travel and wellness over traditional luxury goods. The personal luxury goods market is expected to shrink by 2%, marking its first slowdown since the Great Recession (excluding the COVID-19 period), largely driven by economic uncertainty and rising prices. Generation Z's reduced advocacy for luxury brands has contributed to a shrinking customer base, with 50 million fewer consumers over the past two years. While certain segments like beauty and eyewear are performing well, overall demand for discretionary items has decreased. The outlet channel has gained popularity as consumers seek value purchases, while online sales are stabilising after post-pandemic fluctuations. Regionally, the US, Japan, and parts of Europe are seeing positive trends, but China and Canada are experiencing slowdowns. Emerging markets like Latin America and India are expected to add significant numbers of new luxury consumers by 2030. To navigate these challenges, brands must focus on creativity, personalisation, and leveraging technology to enhance customer experiences. The long-term outlook remains positive, with potential growth beyond 2024 depending on macroeconomic conditions.

Bain & Company report: global luxury sales to drop by 2% in 2024, one of the weakest years on record