By Fflur Roberts, Head of Luxury for Euromonitor International
The luxury industry has flourished for the past 10 years, but the good times have started to stall and brands are now facing a possible power shift from East to West. Nevertheless, at the same time, connectivity and digital sales will continue to drive new opportunities in digital innovation, with the internet and social media reaching new frontiers.
Our latest data reveal that 2016 will be yet another challenging year for the luxury goods industry. In particular, the economic instability, social unrest, armed conflict, and further threats of terrorist attacks in key luxury shopping destinations will continue to act as a drag on sales, not to mention the turmoil on the global foreign-exchange markets which could create further global currency wars for the industry.
Despite these headwinds, our latest data show that the outlook for the luxury goods industry remains optimistic, with sales set to reach US$328 billion by 2016, having increased from US$317 billion in 2015. The new data also indicates that developed markets are largely outperforming emerging markets and that there is a clear shift in spend from East to West.