View
104
Download
0
Category
Preview:
Citation preview
The Business of Luxury
How it works – where it leads
Luxury as a Business
Luxury is a fascinating phenomenon, but also a specialized business and an important eco- nomic factor.
The global business of luxury has grown subs- tantially in recent de- cades, and it plays by its own rules, many of them contrary to the ones that govern the mass market.
Growing Markets
Despite a number of global economic downturns, overall growth rates for luxury goods have been quite impressive, especially in emerging markets such as Brazil, Russia, India, and China.
Growing Markets
While European countries and the Americas currently still account for more than 60 % of global luxury sales, the market share of Asia has doubled during the past six years and continues to grow rapidly.
Growing Markets
Chinese consumers alone account for 20 to 25 % of global luxury sales.
7785 92 96
108
128 133 133 128136
147159
170 167153
173
192
212 217
Market value in billion euros
0
50
100
150
200
250
95Year 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13
Value of the Personal luxury Goods Market Worldwide from 1995 to 2013 (in Billion euro)
Figure 1: Bain & Company, Altagamma, © Statista 2014
Luxury Goods Market
Source: Bain & Company, Altagamma, © Statista 2014
Value of the Personal Luxury Goods MarketWorldwide from 1995 to 2013 (in Billion Euro)
Major Trends
While many wellknown luxury companies base their success on tradition, another important factor in longterm growth is innovation and responsiveness to changing circumstances.
1
Major Trends 2A major trend that is having an impact on many luxury players is the shift from material to experiential luxury in maturing markets.
Major Trends 3Currently, more than half of all luxury purchases are nonmaterial in nature and the sector is growing fast.
Major Trends 4Another phenomenon changing the way luxury is perceived, sold, and purchased is the Internet. Driving forces behind this and other trends are changing demographics, consumption patterns, values, as well as the tastes and habits of Generation Y.
Luxury Goods OnlineLuxury brands are reluctant to use online platforms because luxury is considered an identity and a philosophy that evokes uniqueness and exclusivity.
However, online platforms can still permit direct interaction between consumers and luxury brands while creating emotional and social values.
Several luxury brands now use online platforms very success-fully for their communication activities.
As a result, a good number of authors argue that online chan-nels are not appropriate for luxury brands because of the absence of personal contact, an ability to have a brand expe- rience, and its wide accessibility.
In The Business of Luxury the contents of this presentation are further expanded.
http://vdf.ch/the-business-of-luxury.html
Would you like to know more?
What you will learn: 1. about the historical roots and the conceptual basis of luxury;2. how the global luxury market is structured in terms of
industries and countries;3. what major trends will shape the business of luxury in
future years;4. about luxury in the online world and the specifics of
computermediated communication;5. what the transition from product to service and experience
focus mean for luxury companies and what they can learn from small niche players.
© 2017, vdf Hochschulverlag AG an der ETH Zürich. All rights reserved.We’re looking forward to your feedback: verlag@vdf.ethz.ch
Fabio Duma, Christine Hallier Willi, Cary Steinmann
2014, 62 pages, ISBN 978-3-7281-3662-6
vdf Hochschulverlag AG an der ETH Zürich
02 The Business of LuxuryFabio Duma, M.A. HSG
Prof. Christine Hallier Willi, PhD
Prof. Cary Steinmann, PhD
Recommended