The rising popularity of aspirational luxury products, the increase in internet penetration among the local millennials and Gen Z, combined with the active engagement of brands on social media have facilitated the growth of Asia-Pacific (APAC) luxury sales. With strong growth in the APAC region, brands are now seeking a deeper level of connection with luxury consumers and are adopting strategies to engage with local consumers, particularly the younger population, finds GlobalData.
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GlobalData’s latest report, ‘Asia Pacific (APAC) Luxury Retailing Market Size, Consumer and Retail Trends, Competitive Landscape and Forecast, 2016-2026‘ reveals that the APAC luxury retail market sales fell by 14.6 percent in 2020 – a loss of USD 16.1 billion – as COVID-19 induced economic uncertainty made the consumers wary of making high value purchases. However, the market bounced back and experienced a growth of 29.7 percent in 2021 to reach USD 122 billion, 10.8 percent above 2019 as vaccination drives opened up retail access and boosted consumer confidence.
“Despite the disruption, the COVID-19 pandemic had a positive impact on sales in 2021 in the region, as consumers who were earlier shopping for luxury items from Europe were now unable to travel and thus shifted their purchases to brands that were available in the region, boosting luxury sales in the APAC region. Brands are hiring regional celebrities to market their products and adopting strategies such as Livestream commerce events which are in vogue in the region,” said Koyel Ray, Retail Analyst at GobalData.
Some brands are also opting to create their own resale platforms as well, which will help the brand provide a better customer experience and maximize gains from the ongoing trend of the younger generation looking to buy products that are more accessible and that allow them to update their wardrobes more frequently.
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“Luxury retailers in the APAC region are now leveraging NFTs as a lucrative source of secondary revenue. Brands are targeting the young, affluent APAC consumers who are likely to invest in digital tokens like the NFTs and bitcoin and sell digital tokens of their iconic products. Brands are reducing their dependence on traditional sources of revenue as the young and affluent luxury consumer is looking towards the metaverse as their second life, making it an important place for trade of luxury goods,” concluded Ray.