Gifts / Sports & Toys

According to Huacheng Import and Export Data Observation, not long ago, due to the sharp drop in Tesla's share price, Elon Musk, the Twitter owner and Tesla boss, lost the title of the world's richest man. Bernard Arnault, the chairman of LVMH, a French luxury giant, took over the title of the world's richest man. Against the background that the world economy has not yet come out of the haze of epidemic and the development of economic globalization has been dragged into a slow recession by the countercurrent, how can LVMH Group's share price, as a symbol of luxury goods, soar?

This year, the global economic growth is sluggish, the geopolitical turmoil is endless, the supply chain is blocked, and the inflation is high, but the sales of luxury goods are soaring against the trend. According to the industry research report released in November by Bain Consulting and Altagamma, an Italian luxury goods agency, the global luxury goods market is expected to witness a year-on-year growth of 21% this year, with the market size reaching 1.4 trillion euros. The mature markets in the United States and Europe are the strongest, with an increase of about 25% each. Luxury sales in the United States are expected to reach 113 billion euros this year; Europe is the world's second largest market, with sales estimated at 94 billion euros, and most luxury brands have good revenue. According to the report, about 95% of brands have achieved positive growth. In addition, the personal luxury market in China is expected to grow by 36% in 2021, reaching nearly 471 billion yuan, and is expected to become the world's largest luxury market in 2025, Huacheng Import and Export Data Observation reported.

The Bain Consulting Report predicts that in the next ten years, the development speed and capacity of China's luxury market will not be the same as that of the past ten years. However, the Indian market, emerging Southeast Asian markets and African markets still have great potential. Among them, South Korea is expected to become the strongest growth engine in the emerging luxury consumer market.

Under the background of enthusiastic consumers and extremely loose monetary policy of the Federal Reserve in the past three years, the current luxury market has set off the third wave of price rise in the year. Chanel raised the price of handbags again in November. The price of classic small CF handbags rose from 58600 yuan to 61900 yuan, breaking through the 60000 mark. The price of medium CF handbags rose from 62700 yuan to 66500 yuan. The price of large CF handbags rose to 75500 yuan, approaching the official price of Hermes platinum bags. The increase was as high as 84% compared with the price at the beginning of 2019. Tiffany diamond ring products have also undergone a new round of price adjustment. The growth range of the Chinese market is 20% to 59%. The latest price of a T series bracelet is 2300 dollars, more than 53% higher than 1500 dollars when it was just launched eight years ago. Louis Vuitton, Dior, Celine, Fendi and other luxury brands affiliated to LVMH have raised their product pricing several times this year. Gucci, the core brand of Kaiyun Group, another luxury goods giant, raised the price of European products on October 26. The frequency of price increases has changed from two or three times a year to two or three times a year. The price of Bottega Veneta, which belongs to the same group, also rose quietly in the third quarter, by about 10%. Saint Laurent, Balenciaga and other brands have also joined in the regular price increase in recent two years, to improve their own value and make up for the losses caused by the epidemic. Recently, Rolex, a luxury watch brand, quietly raised the retail price of all its products in the European market by 4.38% to 5.45%. The popular model of Ditongna directly rose by 5% to 14600 euros. This is the third time Rolex has raised the price this year. Huacheng Import and Export Data Observation Report.

Even in the face of the current economic turmoil, luxury brands still insist on continuous price increases, mainly because the absolute number of high net worth personal luxury consumers is still increasing, and luxury groups firmly believe that the market will continue to expand in the next year and even 2030. This is mainly due to the excellent growth of personal luxury consumption. After a V-shaped rebound in luxury consumption in 2021, the growth rate of this year will be further accelerated. Bain Consulting report indicates that the sales of global personal luxury goods, including leather accessories, clothing, footwear, jewelry and watches, are expected to grow by 22% this year, from 290 billion euros in 2021 to a record 353 billion euros. Huacheng Import and Export Data Observation reported.

Why are some people keen on luxury goods? Because within a certain scope, luxury consumption and wear have become a symbol to strengthen the external advantages and emphasize the superiority of individual social status. Through big data analysis, researchers found that in areas with more income inequality, people are more sensitive to "status". A study in the United States shows that where the gap between rich and poor is large, the use rate of luxury brands such as Louis Vuitton and Rolex is 70%, while where the income gap is small, the difference is not significant; In places where the gap between rich and poor is large, the proportion of high-end brands' pictures searched online is larger.

It must be noted that the global gap between rich and poor is actually widening. The 2022 Global Wealth Report released by Credit Suisse in September this year shows that although the total global wealth will increase by 12.7% in 2021, it will be the largest growth since its records. In contrast, the proportion of global wealth of the richest 1% has risen for two consecutive years, from 43.9% in 2019 to 45.6% in 2021. The number of "ultra-high net worth people" with wealth of more than 50 million dollars increased by 46000, Huacheng Import and Export Data Observation reported.

At the same time, the number of people facing extreme poverty has increased by at least 75 million this year. The latest Poverty and Shared Prosperity Report of the World Bank also pointed out that the COVID-19, which broke out in 2020, has caused the biggest setback to the cause of global poverty reduction since 1990. The epidemic has caused the most harm to the poor groups: the income loss of the lowest 40% of the population is 4% on average, twice that of the richest 20% of the population. The result was the first rise in global inequality in decades. The increasing inequality between the rich and the poor has made luxury goods more psychologically demanding and more affordable.

A recent statistical survey in South Korea shows that in 2022, the gap between 20% of households upstream and 20% downstream of South Korea's assets will reach a record high, and the Gini coefficient of net assets will also hit the highest record in nearly 10 years. According to the Bain Consulting Report, South Korea is expected to become the strongest growth engine in the emerging luxury consumer market.