Global Luxury Spending Flattens

Global luxury spending is expected to reach nearly $1.58 trillion in 2024, remaining relatively flat compared to 2023. That’s according to the latest luxury report from management consultant Bain & Co., in partnership with Altagamma, the Italian luxury goods manufacturers’ industry association.

Global luxury consumers, grappling with macroeconomic uncertainty and continued price increases among brands, are cutting back on discretionary items. As a result, Bain expects the personal luxury goods market to see its first slowdown since the Great Recession, excluding Covid, experiencing -2% erosion, at current exchange rates, compared to last year.

This trend—particularly among Generation Z, whose affinity for luxury brands continues to decline—has led to a shrinking luxury customer base by a magnitude of about 50 million over the last two years, Bain finds. Meanwhile, top customers continue to grow their share of luxury consumption, although they are progressively losing the feeling of exclusivity from brands.

“Luxury spending has shown remarkable stability this year, despite macroeconomic uncertainty, largely driven by consumers’ appetite for luxury experiences,” said Claudia D’Arpizio, Bain & Co. partner and leader of the firm’s global Fashion & Luxury practice, the lead author of the study. “And yet, 50 million luxury consumers have either opted out of the luxury goods market or been forced out of it in the last two years. This is a signal for brands that it’s time to readjust their value propositions. To win back customers, particularly the younger ones, brands will need to lead with creativity and expand conversation topics.

“Simultaneously, they must keep their top customers front and center, surprising and delighting them while rediscovering one-to-one human interactions. For all customers, it will be critical to double down on personalization, leveraging technology to achieve it at scale.”

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