According to the latest report from consulting firm Bain this month, global luxury goods sales may not increase significantly in the fourth quarter as global consumers become more cautious in their shopping expenses. Global sales of personal clothing, accessories, and beauty products may remain the same as the same period last year, with a 3% decrease based on current exchange rates.
As consumption in the United States and Europe returns to a more normal level after experiencing a surge in the past three years, personal luxury goods sales this year will increase by 8% at a fixed exchange rate, reaching 362 billion euros.
Given the continued volatility of the macro environment in the short term, the company expects that global luxury goods sales may not experience significant growth in 2024, with a growth rate calculated at a fixed exchange rate ranging from 1% to 4%.
Mohammed Abdulmagied Seddiqi, Chief Business Officer of Ahmed Seddiqi&Sons, the parent company of UAE watch retailer, recently revealed at Dubai Watch Week that the waiting list for Rolex watches is shrinking, with some models having their waiting numbers reduced from 10000 to 8000, partly due to the cooling global luxury consumption and reduced market demand.
The Subdial Watch Index fell 1.8% in October, reaching its lowest level since 2021. The index tracks the prices of the 50 most traded watches in the second-hand market, with prices of used watches such as Rolex and Patek Philippe currently down 42% from their peak in April 2022.
As another barometer of the luxury goods market, sources have revealed that the price of Herm è s handbags in the secondary market has decreased, and the brand's sales in some stores in China have recorded a decline in recent months compared to the same period last year. Many consumers have reported that their store's supply is more abundant than before, making it easier to obtain desired items.
Despite the approaching holiday season and the fact that Chinese consumers have always had the habit of shopping during holidays, the queuing phenomenon at Chanel and Herm è s stores, which used to have long queues, has significantly decreased in many landmark shopping malls in China.
Looking at different regions, the luxury goods markets in Europe, the United States, and Asia all lack significant growth momentum.
In addition to stable local sales, the European luxury goods market has long relied heavily on travel retail for sales. However, due to the weakening of tourism demand due to the geopolitical influence in the Middle East, wealthy Americans have temporarily postponed booking trips to Paris.
According to data from travel analysis company ForwardKeys, sales of first class, business class, and premium economy class tickets between New York and Paris increased by 44% in the three weeks leading up to October 7th compared to 2019. However, in the three weeks following the geopolitical turmoil in the Middle East, this number dropped to 4%. Many affluent American consumers who can afford premium economy class and above tickets have postponed or cancelled their pre booked trips.
Luxury tourism retail in Europe is still not waiting for a large number of returning Chinese tourists.
