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Fashion United
08-07-2025
- Business
- Fashion United
Altagamma: future of luxury between top-tier, aspirational clients and high-potential countries like India and Thailand
Milan - Multi-brand retailers are facing a crisis. This is particularly true for those focused on clothing and leather goods, but not those in beauty and watches and necessitates an ever-closer relationship with customers. The luxury sector is experiencing a period of stagnant growth. There is also disaffection among aspirational consumers. This overview of the luxury market emerged this morning in Milan during the eleventh edition of the Altagamma Consumer and Retail Insight. Matteo Lunelli, president of Altagamma, emphasised in his speech that market uncertainty remains unresolved. Tariffs will play a significant role. Among the countries with the greatest potential for luxury companies are India, Indonesia and Thailand. "We face many challenges at the European level," said Lunelli, "from sustainability to Artificial Intelligence, and we must address these challenges at a European level." Recently, a study on the impact of the European luxury industry was presented to the European Parliament by ECCIA, the European Cultural and Creative Industries Alliance. Meanwhile, the eleventh edition of the Altagamma Consumer and Retail Insight presented a qualitative analysis of luxury consumers and new trends in retail. "The Boston Consulting Group study shows that 35 percent of aspirational consumers have reduced their purchases. This is due to the loss of spending power and the decline in consumption in China. On the other hand, the highest segment of the pyramid, which represents 0.1 percent of the total in numerical terms, has increased its spending. This now generates 37 percent in value. For the next 18 months, 75 percent of aspirational consumers say they will maintain or increase their spending. This percentage rises to 85 percent for top-tier clients. To seize this opportunity, companies will have to continue to invest in an increasingly personalised and effective relationship with customers. They will need to consolidate the relationship of trust with them, based on a solid sharing of values. They will also need to leverage the excellence of their creations and their innovative services," explained Lunelli. Aspirational consumers represent over 74 percent of the total market value The process of democratisation has generated extraordinary growth. Aspirational consumers now represent over 74 percent of the total market value. This segment is now showing some fragility. While still representing 61 percent of the high-end market, it has recorded a decrease of 13 percentage points compared to 2013. Among the causes is certainly the decline in purchasing power due to the global situation of uncertainty and the geopolitical crisis. Top-tier clients, with an annual spend of over 50,000 euros on luxury goods and services, are the market protagonists Top-tier clients, with an annual spend of over 50,000 euros on luxury goods and services, are the true protagonists of the market today. This is not only in categories such as yachts or jets (in which they represent the entirety of the segment). It is also across a wide variety of purchases. These include design, wines and spirits, cars, wellness, watches and jewellery, which constitute the majority of the value of their consumption. They have a predilection for experiential luxury and for the new "health as wealth" trend. This considers wellness, aesthetics and the care of personal spaces as priority dimensions. Spending is expected to increase by around 10 percent in the next 18 months. The "True-Luxury Global Consumer Insight" study, conducted by BCG in collaboration with the Altagamma Foundation, highlighted that top-tier clients represent the absolute top of the spending scale. They have an average annual spend of around 360,000 euros and a minimum threshold of over 50,000 euros. Although they constitute less than 0.1 percent of luxury consumers, in 2024 they generated over 23 percent of total market spending, excluding luxury mobility and wellness/longevity, and 37 percent including them. They exert a significant influence on the direction and dynamics of the entire sector. Looking ahead to 2025, the personal luxury market will continue to face headwinds, with growth expected to be flat or slightly down. The scenario reflects a combination of critical factors: slowing demand in China, persistent macroeconomic uncertainty in the US, and continued contraction of the aspirational segment. These are all signs of a market in full transition. What are the causes of the slowdown in the personal luxury market? Among the most cited causes of the recent slowdown in the personal luxury market is the slowdown in luxury goods consumption by aspirational consumers. But what is really happening? This year's edition of True-Luxury Global Consumer Insights delves into the historical evolution of luxury, going back to its origins in the nineteenth century, when it was intended exclusively for a wealthy elite. Over the last century, however, luxury has progressively opened its doors to a wider audience. The process of democratisation has generated extraordinary growth, with aspirational consumers, those who spend less than 5,000 euros a year, coming to represent over 70 percent of the total market volume. However, the segment that once fuelled growth is now showing its fragility. The spending of aspirational consumers has proven to be extremely sensitive to macroeconomic cycles. While top-tier clients tend to spend counter-cyclically, supported by the positive performance of financial markets and immune to general economic volatility, aspirational spending is closely correlated with global GDP trends, with a correlation of 0.97, according to the study. Due to this strong market volatility, the aspirational segment now represents 60 percent of the luxury market, down 13 percentage points from 2013. In the last year alone, about 35 percent of aspirational consumers have reduced or stopped spending on luxury goods. This percentage rises to 45 percent in China and to about 30 percent in Europe and the US. The main factors behind this shift are price increases, loss of perceived value and greater financial caution. The three main categories towards which consumers are reallocating their budget are: savings or financial investments (22 percent); wellness/longevity and personal care (13 percent); and second-hand luxury (13 percent). Top-tier clients are preparing to increase their luxury purchases "Today, aspirational consumers are focusing on investments in timeless products and are increasingly critical of price increases that are not justified by innovation or quality. Half say they prefer to buy iconic or timeless pieces and three out of four have given up on a purchase because of a negative perception of the price-quality ratio," the study continues. It is not just a matter of economic caution, but probably a real redefinition of the very meaning of luxury for this segment. The outlook for 2026 remains cautious for aspirational consumers: 50 percent still feel financially vulnerable (compared to 10 percent of top-tier clients) and 60 percent say they are concerned about macroeconomic pressures (such as tariffs). Overall, 25 percent expect a further reduction of between 5 percent and 25 percent in the next 18 months, while 40 percent of these expect their spending on luxury goods to remain stable. In contrast, top-tier clients are preparing to increase their luxury purchases, with 51 percent expecting growth of between 5 percent and 25 percent in the near future, while 34 percent expect to maintain their spending. What is the impact on luxury brands? Today, for brands heavily dependent on this segment, the consequences are clear: brands that count more than 50 percent of their clientele among aspirational consumers are experiencing the most marked declines, with significantly lower performance in the last three years and, in particular, in the last 12-18 months. In contrast, brands that have maintained their loyalty to the core of top-tier clients (the 0.1 percent of the clientele responsible for 37 percent of market value (including the luxury mobility and wellness/longevity categories) are not only weathering the crisis, but are experiencing a period of strong growth. Who are the top-tier clients? At the heart of the true-luxury sector is a small but extremely influential group: top-tier clients who, despite representing just 0.1 percent of the total clientele, have an annual spending capacity of over 50,000 euros and alone contribute to a considerable slice of the luxury market. The relevance of these clients is closely linked to a solid and constantly expanding demographic segment: high net worth individuals (HNWIs). In 2024, globally, the HNWI population exceeded 940,000 individuals and is expected to grow with a CAGR of 9 percent in terms of numbers and 8 percent in terms of wealth by 2030. In just six years, in fact, the wealth held by this segment will increase from 68 to 103 trillion euros. North America remains the heart of global HNWI wealth, holding 46 percent of total wealth and continuing to drive the market. At the same time, however, new growth areas are emerging: regions such as India and Southeast Asia are seeing a significant acceleration in wealth creation. India, in particular, will see the number of HNWIs increase with an estimated CAGR of between 11 percent and 15 percent until 2034, supported by an increasingly international and dynamic clientele. This article was translated to English using an AI tool. FashionUnited uses AI language tools to speed up translating (news) articles and proofread the translations to improve the end result. This saves our human journalists time they can spend doing research and writing original articles. Articles translated with the help of AI are checked and edited by a human desk editor prior to going online. If you have questions or comments about this process email us at info@
Fashion Network
04-07-2025
- Business
- Fashion Network
Europe's luxury sector is ' economic powerhouse' but needs more support
A new report on the high-end and luxury sector in Europe shows that it's a '€986 billion economic powerhouse driving jobs, tourism and craftsmanship'. The study comes from the European Cultural and Creative Industries Alliance (ECCIA), which includes EU countries and the UK, and shows that Europe's high-end/luxury sector represents 5% of the continent's GDP and that it 'continues to drive economic growth, preserve cultural heritage, and champion excellence well beyond the continent'. The study was conducted by Bain & Company for ECCIA and also said that the sector has global leader status with 70% global market share. And for personal goods, that share is 80%. But the prospects are 'clouded' due to 'external challenges such as tariffs and emerging global trade uncertainty'. That's a worrying situation given that the sector employees as many as 2 million people throughout Europe and further concerns include the difficulty of attracting and retaining the next generation of skilled artisans. 'European luxury goods continue to dominate global markets, with the latest figures demonstrating a strong performance over the past five years and a solid position for growth within the global high-end and luxury market — rooted in the sector's unique resilience and its ability to adapt and seize opportunities in emerging markets,' said Claudia D'Arpizio of Bain & Company. And she added that 'while these new findings show that the sector accounts for 11.5% of total European exports, high-end and luxury goods are much more than economic drivers. Luxury represents Europe's soft power 'The brands, through their products and experiences, also represent the ultimate expression of the soft power Europe wields through its creativity, innovation, and craftsmanship — Europe's unique 'artisanal intelligence'. This sector is a creative powerhouse that invests up to 5% of revenues in education and training, and up to 3% in sustainability and innovation, which contribute to social prosperity, cultural preservation, and economic growth across Europe's clusters of excellence'. But as mentioned, the sector has huge challenges to deal with, notably 'escalating geopolitical tensions, rising tariffs, and protectionist trade policies, especially between the US and China which make up 35%-45% of the global revenues for the sector'. 'It's tempting to assume that this the sector is shock-proof from some of the economic turbulence we've been seeing…. [but] we are sensitive to the some of the warning signs,' said Michael Ward, the MD of luxury London retailer Harrods who's also president of ECCIA. 'European high-end and luxury brands supported 2 million jobs in 2024, with 160,000 new jobs created since 2019, outpacing broader EU labour market growth. Tariff measures threaten to disrupt global demand, drive up costs, and force companies to reconsider supply chains as we focus on profitability and call for greater stability.' The reports shows that the high-end/luxury sector is also key for 40% of international travellers who cite luxury as a reason for visiting Europe. And high-spending tourists represent up to 25% of tourism-generated value. One aim of the report is to publicise the need for 'smart and urgent policy support to safeguard one of Europe's cultural and economic treasures'. Among the measure the body is calling for are strengthened intellectual property rights (IPR) and more power given to combat counterfeiting. It also wants to see a boost to the EU's legislative framework to help brands enforce their selective distribution networks against unauthorised distributors, protecting brand image and investments while ensuring consumer safety. And it's calling for more EU support for craftsmanship and skills development, as well as support for free trade agreements, simplifying procedures for obtaining EU visas and encouraging VAT-free shopping for non-EU tourists. The ECCIA, established in 2010, is composed of seven European cultural and creative industries organisations — Altagamma (Italy), Circulo Fortuny (Spain), Comité Colbert (France), Gustaf III Kommitté (Sweden), Laurel (Portugal), Meisterkreis (Germany) and Walpole (UK). Between them they represent 750 brands and cultural institutions.
Fashion Network
04-07-2025
- Business
- Fashion Network
Europe's luxury sector is ' economic powerhouse' but needs more support
A new report on the high-end and luxury sector in Europe shows that it's a '€986 billion economic powerhouse driving jobs, tourism and craftsmanship'. The study comes from the European Cultural and Creative Industries Alliance (ECCIA), which includes EU countries and the UK, and shows that Europe's high-end/luxury sector represents 5% of the continent's GDP and that it 'continues to drive economic growth, preserve cultural heritage, and champion excellence well beyond the continent'. The study was conducted by Bain & Company for ECCIA and also said that the sector has global leader status with 70% global market share. And for personal goods, that share is 80%. But the prospects are 'clouded' due to 'external challenges such as tariffs and emerging global trade uncertainty'. That's a worrying situation given that the sector employees as many as 2 million people throughout Europe and further concerns include the difficulty of attracting and retaining the next generation of skilled artisans. 'European luxury goods continue to dominate global markets, with the latest figures demonstrating a strong performance over the past five years and a solid position for growth within the global high-end and luxury market — rooted in the sector's unique resilience and its ability to adapt and seize opportunities in emerging markets,' said Claudia D'Arpizio of Bain & Company. And she added that 'while these new findings show that the sector accounts for 11.5% of total European exports, high-end and luxury goods are much more than economic drivers. Luxury represents Europe's soft power 'The brands, through their products and experiences, also represent the ultimate expression of the soft power Europe wields through its creativity, innovation, and craftsmanship — Europe's unique 'artisanal intelligence'. This sector is a creative powerhouse that invests up to 5% of revenues in education and training, and up to 3% in sustainability and innovation, which contribute to social prosperity, cultural preservation, and economic growth across Europe's clusters of excellence'. But as mentioned, the sector has huge challenges to deal with, notably 'escalating geopolitical tensions, rising tariffs, and protectionist trade policies, especially between the US and China which make up 35%-45% of the global revenues for the sector'. 'It's tempting to assume that this the sector is shock-proof from some of the economic turbulence we've been seeing…. [but] we are sensitive to the some of the warning signs,' said Michael Ward, the MD of luxury London retailer Harrods who's also president of ECCIA. 'European high-end and luxury brands supported 2 million jobs in 2024, with 160,000 new jobs created since 2019, outpacing broader EU labour market growth. Tariff measures threaten to disrupt global demand, drive up costs, and force companies to reconsider supply chains as we focus on profitability and call for greater stability.' The reports shows that the high-end/luxury sector is also key for 40% of international travellers who cite luxury as a reason for visiting Europe. And high-spending tourists represent up to 25% of tourism-generated value. One aim of the report is to publicise the need for 'smart and urgent policy support to safeguard one of Europe's cultural and economic treasures'. Among the measure the body is calling for are strengthened intellectual property rights (IPR) and more power given to combat counterfeiting. It also wants to see a boost to the EU's legislative framework to help brands enforce their selective distribution networks against unauthorised distributors, protecting brand image and investments while ensuring consumer safety. And it's calling for more EU support for craftsmanship and skills development, as well as support for free trade agreements, simplifying procedures for obtaining EU visas and encouraging VAT-free shopping for non-EU tourists. The ECCIA, established in 2010, is composed of seven European cultural and creative industries organisations — Altagamma (Italy), Circulo Fortuny (Spain), Comité Colbert (France), Gustaf III Kommitté (Sweden), Laurel (Portugal), Meisterkreis (Germany) and Walpole (UK). Between them they represent 750 brands and cultural institutions.
Fashion Network
04-07-2025
- Business
- Fashion Network
Europe's luxury sector is ' economic powerhouse' but needs more support
A new report on the high-end and luxury sector in Europe shows that it's a '€986 billion economic powerhouse driving jobs, tourism and craftsmanship'. The study comes from the European Cultural and Creative Industries Alliance (ECCIA), which includes EU countries and the UK, and shows that Europe's high-end/luxury sector represents 5% of the continent's GDP and that it 'continues to drive economic growth, preserve cultural heritage, and champion excellence well beyond the continent'. The study was conducted by Bain & Company for ECCIA and also said that the sector has global leader status with 70% global market share. And for personal goods, that share is 80%. But the prospects are 'clouded' due to 'external challenges such as tariffs and emerging global trade uncertainty'. That's a worrying situation given that the sector employees as many as 2 million people throughout Europe and further concerns include the difficulty of attracting and retaining the next generation of skilled artisans. 'European luxury goods continue to dominate global markets, with the latest figures demonstrating a strong performance over the past five years and a solid position for growth within the global high-end and luxury market — rooted in the sector's unique resilience and its ability to adapt and seize opportunities in emerging markets,' said Claudia D'Arpizio of Bain & Company. And she added that 'while these new findings show that the sector accounts for 11.5% of total European exports, high-end and luxury goods are much more than economic drivers. Luxury represents Europe's soft power 'The brands, through their products and experiences, also represent the ultimate expression of the soft power Europe wields through its creativity, innovation, and craftsmanship — Europe's unique 'artisanal intelligence'. This sector is a creative powerhouse that invests up to 5% of revenues in education and training, and up to 3% in sustainability and innovation, which contribute to social prosperity, cultural preservation, and economic growth across Europe's clusters of excellence'. But as mentioned, the sector has huge challenges to deal with, notably 'escalating geopolitical tensions, rising tariffs, and protectionist trade policies, especially between the US and China which make up 35%-45% of the global revenues for the sector'. 'It's tempting to assume that this the sector is shock-proof from some of the economic turbulence we've been seeing…. [but] we are sensitive to the some of the warning signs,' said Michael Ward, the MD of luxury London retailer Harrods who's also president of ECCIA. 'European high-end and luxury brands supported 2 million jobs in 2024, with 160,000 new jobs created since 2019, outpacing broader EU labour market growth. Tariff measures threaten to disrupt global demand, drive up costs, and force companies to reconsider supply chains as we focus on profitability and call for greater stability.' The reports shows that the high-end/luxury sector is also key for 40% of international travellers who cite luxury as a reason for visiting Europe. And high-spending tourists represent up to 25% of tourism-generated value. One aim of the report is to publicise the need for 'smart and urgent policy support to safeguard one of Europe's cultural and economic treasures'. Among the measure the body is calling for are strengthened intellectual property rights (IPR) and more power given to combat counterfeiting. It also wants to see a boost to the EU's legislative framework to help brands enforce their selective distribution networks against unauthorised distributors, protecting brand image and investments while ensuring consumer safety. And it's calling for more EU support for craftsmanship and skills development, as well as support for free trade agreements, simplifying procedures for obtaining EU visas and encouraging VAT-free shopping for non-EU tourists. The ECCIA, established in 2010, is composed of seven European cultural and creative industries organisations — Altagamma (Italy), Circulo Fortuny (Spain), Comité Colbert (France), Gustaf III Kommitté (Sweden), Laurel (Portugal), Meisterkreis (Germany) and Walpole (UK). Between them they represent 750 brands and cultural institutions.
Fashion United
04-07-2025
- Business
- Fashion United
European luxury: A new report reveals the challenges and growth prospects
European premium and luxury brands represent 5 percent of European GDP, or 986 billion euros. This figure, from a new report by the European Cultural and Creative Industries Alliance (ECCIA), in collaboration with the Comité Colbert and Bain & Company, is up 1 percent compared to 2018. While its evolution demonstrates growth dynamics, the sector's future appears more fragile than ever, given the tariff announcements by the Trump administration and geopolitical tensions. Absence of a single, clear evolutionary scenario In 2024, the value of the premium and luxury sector is down 1 percent compared to the previous year and now stands at 1,417 billion euros. These figures reflect the sector's sensitivity to recent economic fluctuations. 'In a baseline scenario where current turbulence gradually subsides, the luxury sector should reach a market size of between two trillion and 2.5 trillion euros by 2030,' the ECCIA study states. The experts confirm: 'The macroeconomic uncertainty following recent tariff announcements makes it difficult to define a single, clear evolutionary scenario.' The personal luxury goods market, which includes fashion, currently represents about a quarter of the entire luxury goods sector. It has experienced robust growth over the past five years, with a CAGR (Compound Annual Growth Rate) of 5 percent from 2019 to 2024 (estimate). In 2024, the market is expected to experience its first slowdown since the Great Recession (2008-2009), excluding the impact of Covid-19, with a projected contraction of two percent at current exchange rates compared to the previous year. In this context, ECCIA is sounding the alarm: 'Retaliatory measures, including tariffs and non-tariff barriers, threaten the industry's ability to maintain competitive access to these essential export markets,' the organisation stated in a press release. The rise of protectionist discourse could heighten tensions for a sector that relies heavily on open markets. ECCIA concluded: 'Moreover, our production cannot be relocated, as our business model and attractiveness are based on European cultural heritage and expertise.' Key pillars of luxury To maintain positive momentum, luxury and premium players must keep in mind the maintenance of key pillars: aura; craftsmanship and technical excellence; creativity and innovation; sustainability and social responsibility; customer experience; selection of their distribution network; and their global appeal. Focus on six of them. Aura Aura is an essential value lever in the luxury sector. It encompasses a brand's heritage, creativity, emotion and exclusivity to create a strong emotional bond with the consumer. In the age of digital technology and AI, where luxury codes are increasingly imitated, brands must preserve the authenticity of their creativity by combining innovation and heritage. Tomorrow's aura will no longer be limited to rare objects and materials. It will be expressed through strong emotional experiences, consistent storytelling and sincere engagement with contemporary issues such as inclusion, identity and social responsibility. Aura will thus become a marker of meaning as much as distinction. Craftsmanship and technical excellence The future of European luxury depends on brands' ability to preserve and transmit their craftsmanship in the face of two major challenges: the rise of local competition in emerging markets and the scarcity of skilled craftspeople in Europe. To address this, brands are investing in training, academies and actions to promote crafts, in order to guarantee succession and strengthen the attractiveness of these professions. By anchoring this expertise in the future, they are securing their value chains while reaffirming their uniqueness in an increasingly competitive global market. Sustainability and social responsibility The future of European luxury relies on ever-deeper integration of sustainability and social responsibility at the heart of business models. Rooted in craftsmanship and respect for nature, luxury brands must continue to innovate to protect their resources, while strengthening transparency, traceability and ethics throughout their value chain. In a context of increasing regulation, it will be essential for them to be able to make their sector-specific characteristics heard, in order to build ambitious, coherent and consumer-understandable sustainable strategies. Customer experience The future of luxury lies in deepening the relationship between brands and customers, far beyond the act of purchase. To remain relevant, brands must offer immersive, cultural and emotional experiences that fully integrate into their customers' lifestyles and values. By cultivating these authentic connections through exclusive events and personalised interactions, they will strengthen their place in each consumer's personal world, transforming loyalty into lasting attachment. Selective distribution The future of luxury relies on increasingly selective, controlled and omnichannel distribution, in order to preserve exclusivity while meeting the expectations of a demanding global clientele. Brands will need to continue to closely integrate physical and digital channels to offer personalised, consistent and emotionally engaging experiences. This strategy will not only strengthen loyalty and perceived value, but also protect product integrity in the face of growing grey market risks, while guaranteeing a direct and controlled relationship with each customer. Global recognition and appeal To stay ahead, brands will need to step up their global marketing investments, adapting to the specific expectations of key markets such as Asia, the Middle East and the US, while preserving their European identity based on excellence, creativity and expertise. This strategy will enhance their attractiveness to an increasingly diverse and demanding international clientele. This article was translated to English using an AI tool. FashionUnited uses AI language tools to speed up translating (news) articles and proofread the translations to improve the end result. This saves our human journalists time they can spend doing research and writing original articles. Articles translated with the help of AI are checked and edited by a human desk editor prior to going online. If you have questions or comments about this process email us at info@
