Global and domestic direct-to-consumer e-commerce company ESW reported a 17 percent increase in cross-border online sales of luxury goods in the first half of 2022, despite diminishing consumer confidence.
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In spite of continued economic turbulence, geopolitical instability, and a cost-of-living crisis in 2022, ESW’s Global Voices: Consumer Pulse survey found that a fifth of consumers (21 percent) bought luxury goods internationally, led by shoppers from China (46 percent), South Korea (36 percent), and the UAE (34 percent).
Handbags and accessories were the most popular luxury product categories bought cross-border (44 percent), followed by clothing (42 percent), and jewellery (39 percent).
According to the report, international sales of handbags and accessories and jewellery were 40 percent higher than domestic sales (40 percent and 33 percent, respectively). The key drivers for shoppers to purchase from international luxury brands were satisfaction with previous cross-border purchases (31 percent), as well as a lack of availability in their home markets (27 percent).
In terms of cross-border luxury goods purchases, the UK ranks second (32 percent) after the United States (56 percent) and ahead of France (29 percent) and Italy (25 percent).
“Luxury is continuing to rise as the best performing cross-border category with this latest reported increase of 16 percent, which is even more impressive considering the fact that our research indicates sales in this category are expected to grow by 50 percent in 2021,” said Natashia Redfern, Vice President of UK ales at ESW.
“This showcases the impressive work luxury retailers have put in to recreate the in-store brand experience online to win conversions and customer loyalty. Additionally, brands and retailers must take note, the data clearly shows a positive previous cross-border purchasing experience is the key driver for engendering customer loyalty and repeat purchasing long-term.”
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Consumers are prioritising access to products over the traditional luxury flagship store model, according to ESW, which contributes to an increase in cross-border sales. Cross-border luxury purchasers said that they were willing to spend less time in-store in order to receive their products faster by purchasing online. However, customers still have high expectations of digital commerce with 79 percent saying they expect the exceptional, personalised customer service experienced in-store to be replicated online.