The Altagamma 2024 Observatory, presented in Milan, highlighted a phase of stabilization for the luxury sector, after the strong post-pandemic recovery and the record results of 2023. Current estimates predict that the global luxury market will close 2024 with a value of approximately 1.478 billion euros, slightly down (about 2%) compared to the almost 1.500 billion reached the previous year.
According to the analysis of Bain & Company and Altagamma Foundation, the demand for personal luxury goods shows a slight slowdown: the turnover of this segment is expected to fall from 369 billion euros in 2023 to approximately 363 billion. In contrast, luxury experiences – such as travel, events, wellness treatments, and exclusive services – continue to register a 5% growth.
Among experiential goods, yachts, luxury cars, and private jets stand out in popularity, driven by the upper-income segment of consumers. Sectors such as beauty, jewelry, and eyewear also maintain strong appeal, confirming a lasting interest in quality tangible goods.
“Despite the macroeconomic complexities, luxury spending has maintained remarkable stability, thanks to consumers’ desire to live excellent experiences,” he explained. Claudia D'Arpizio, senior partner and global head of fashion & luxury at Bain & Company, during the conference. «However, the loss of 50 million consumers in the last two years signals that brands must rethink their value propositions. To win back customers, especially younger ones, it is necessary to focus on creativity and broaden conversations. At the same time, brands will have to continue to focus on their top customers, surprising them with human and personalized interactions».
"To ensure a sustainable growth path in the long term, brands will have to rethink their value proposition, mixing new rules of the game, with the characterizing elements of this sector, within a single strategy", he specified. Federica Levato, senior partner and Emea fashion & luxury leader at Bain & Company. «It will be essential to rediscover the true essence of the brand and, at the same time, embrace the founding pillars on which luxury has always been based, namely craftsmanship, creativity, personalization of the shopping experience and the intimate relationship with the consumer, leveraging technological tools such as artificial intelligence to ensure perfect execution».
The global economic and geopolitical environment – influenced by conflicts, inflation and rising costs – has reduced purchasing power and consumer confidence, particularly affecting Asian markets. In China, there is a sharp decline, partially offset by the positive performance of Japan, while other markets remain relatively stable compared to last year.
Finally, there is a growing polarization in the sector: ultra-high luxury consumption is holding up well, while aspirational luxury, aimed at a wider audience, is suffering from a decline in interest, especially among young people. “Generation Z” shows less affection for luxury brands, determining a contraction of about 50 million customers in the last two years. On the contrary, consumers with high spending power are gaining relevance, even if they perceive a decrease in the sense of exclusivity that luxury offers.
The forecasts for next year have been exposed by Stefania Lazzaroni, General Manager di high gamma, who presented the report “Altagamma Consensus 2025,” made with the collaboration of 21 Italian and international financial analysts. Due to global economic conditions, limited growth is expected for the luxury market, although the trend remains uncertain due to various factors, such as inflation, high interest rates, geopolitical tensions, rising prices and the reduction in purchasing power of the medium-high segment of consumers. "The average EBITDA for personal luxury goods is estimated to increase by 3%, with revenue growth also of 3%," Lazzaroni said. "A potential improvement in the second half of the year could come from the recovery of travel and the renewed optimism of Chinese consumers."
(Source:MFF)
