The survey found that sales in the global luxury market fell to 1.48 trillion euros ($1.54 trillion) in 2024, down 1-3% year-on-year at current exchange rates.
This slight decline means strong growth normalization seen in 2022 and 2023, the report says that 2024 performance remains above pre-Covid levels.
Bain & Co. The report explores the reasons behind the decline in sales last year, how the jewelry category works, and US market trends.
Here are five takeaways from the report.
The luxury market’s customer base is shrinking.
For the first time in the report’s 23-year history, the luxury market customer base has been contracted.
Bain estimates that it lost around 50 million customers worldwide between 2022 and 2024, with 400 million to 350 million customers by the end of 2024, particularly among younger consumers. The demand for personal luxury goods is declining.
The market for personal luxury items (e.g. gems, watches, clothing, cosmetics, etc.) that Bain is known as the “core core” of the luxury segment saw its first contraction in 15 years excluding the pandemic period.
“We are tackling macroeconomic uncertainties and working to continue to promote prices by brands, reducing discretionary items slightly,” the report said.
The size of the personal luxury goods market was immersed in 2024 by 2% year-on-year at current exchange rates to 363 billion euros ($377 billion).
“This trend — particularly among Gen-Z, where luxury brand advocacy continues to decline, and (overall) has reduced the luxury customer base,” the report states.
The slowdown in the market has resulted in polarized performance among luxury brands.
The report estimated that in 2024 only about a third of brands had grown compared to 95% from 2021 to 2022 and 65% from 2023.
“The average profitability of individual luxury brands has been eroded, reflecting a rise in prices and rising costs to serve consumers, from marketing to distribution,” the report states .
By region, America’s sales totaled 100 billion euros ($103.86), down 1% year-on-year at current exchange rates.
U.S. luxury markets have been on a “generally upward” quarterly trajectory throughout the year despite the decline and flow of consumer trust.
Ambitious customers face financial pressures, with more shoppers choosing high-value luxury and non-luxurious brands and turning to department stores and outlet malls to shop.
Shoppers, especially young people, value “hyperpersonized” customer service and are looking for unique items.
He said several factors should help maintain performance in the US market, including potential interest rate cuts by the Federal Reserve, presidential election conclusions, ease of inflation, tax cuts outlook and strengthening economic growth.
Jewelry was the “most resilient” part of the Koal Luxury segment.
The overall market for personal luxury goods was struggling, but jewelry was a top performer, especially in the US.
The gem “proves to be the most resilient koal luxury category in 2024,” the report said, up 2% at current exchange rates to 31 billion euros ($32.2 billion) in sales. He said he would reach it.
“This performance was driven by a consistent high-low brand strategy and a strengthened customer-centric approach,” the report said.
High jewelry has done particularly well, surpassing the “less-good” portion of the market.
“Competition has increased, luxury fashion houses have expanded their presence in the segment, and the rise of the local giants looking to grow beyond the domestic market,” he said.
For example, Chanel introduced the “Haute Joaillerie Sport” high jewelry collection in 2024.
The report also states that secondhand luxury is becoming increasingly a “gateway” for ambitious consumers who can’t afford new items, with secondhand gem sales being particularly strong and secondhand sales being accelerated I’m paying attention to what I’m doing.
The success of the jewelry category is impressive considering that few gorgeous categories recorded growth in 2024.
The report states that “experienced elevation-related volumes have been reduced as our focus is on rising table prices and improving the price category for the mixture of products sold.”
Apart from gemstones, gorgeous beauty and eyewear rose 3-5% year-on-year as customers chose small dul and responded well to “updated creativity” in the eyewear category.
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The watch category struggled as consumer interest waned.
The watch had a tough year, with sales of 5-7% at current exchange rates falling to around 51 billion euros ($529.7 billion) in 2024.
“This segment has concluded its recent growth cycle amid declining consumer interest and prices falling in the secondary market,” the report said.
Only top brands said they saw positive results, and there is an increasing demand for unique shapes and valuable materials.
In particular, gender-specific designs were less common.
The report also noted that the “retail” trend of distribution continues, with brands trying to build connections with customers in their stores rather than relying on multi-brand distributors.
The outlet store worked fine as shoppers were looking for deals.
According to the report, the outlet channel surpassed the market in 2024, recording a growth rate of 0-3% at current exchange rates.
While most physical luxury stores have suffered from “slow down” pedestrians, outlet channels are the gateway to luxury markets driven partly by shoppers looking for more for money It gained popularity as
“Ambitional consumers faced increased financial pressure, leading to a shift towards large luxury and non-luxury brands, particularly in department stores and outlet malls,” the report said.
Regarding other channels, Monobrand Store saw sales decline of 1-4% at current exchange rates.
Multi-brand stores also struggled, with department stores sales dropping by 2-4%, while specialty stores fell by 4-8%.
Regarding online sales, the report said the channels have normalised after the post-pandemic swing, recording a 1-4% decline at current exchange rates. It maintained a 20% share of the luxury market.
In particular, off-price online platforms have “growed as gateways to (service) luxury purchases and an attractive alternative for wealthy consumers to trade down.”
Success in 2025 requires a strong strategy for luxury retailers.
Last year was challenging for the luxury sector, but this year there could be growth.
The personal luxury segment is projected to grow moderately in 2025, with sales estimated to increase by 4%.
According to the report, the solid market foundation will lead to 4-6% annual growth until 2030, with estimated totals from 460 billion to 500 billion euros ($4777775 billion to $5192.9 billion) by the end of the period ) said it should have reached the level.
The demographic and macroeconomic tailwinds need to bolster the sector as they said there is a high chance that more than 300 million new customers will emerge in China and other markets over the next five years.
Retailers may make some tough choices to navigate the challenges facing the luxury industry. For example, deciding whether to seek exclusiveness or reach more audiences, but determining strategies is the path ahead, the report says.
“In every potential strategic choice, there is a common need to rebuild luxury foundations by refocusing the fundamentals that always characterize luxury, such as the best quality and creativity. Beyond individual transactions, By connecting with multiple audiences and promoting relationships with consumers that transcend short-term hype. And finally, by delivering perfectly, new technologies such as AI generated along the entire value chain. By using it,” the report states.
Read the full report on the Bain & Company website.
