World economics is changing and evolving very fast. As consumers from emerging markets such as Brazil, Russia, India, China and South Africa (BRICS) are gaining purchasing power, new luxury consumers have to be considered as they will be shaping the future of luxury retailers all around the globe. In February 2017, Deloitte conducted a study across 11 countries to explore consumers’ changing attitudes and behaviors on luxury goods. The results of their survey and studies are crystal clear: luxury goods spending is still pretty robust, and is coming from consumer segments that have not been very active in the past.
Overall, only 4% of people seem to have dropped their spending on luxury goods over the last 5 years. However, growth in this particular category appears to be driven by consumers coming from emerging markets. Consumers coming from these specific markets declared a major increase of their luxury buyings of 70% in the last 5 years, compared to 52% in the more mature markets such as United States and France.
Deloitte study’s also revealed an interesting aspect of emerging markets consumers reality. As luxury goods are not accessible and affordable in their domestic countries, emerging markets shoppers are often doing their purchases while traveling in more mature countries. 40% of these consumers are choosing to buy their luxury goods abroad, while traveling for work or for pleasure.
Takeaways
Emerging markets have to be considered as great opportunities by retailers. If you are using the right strategy, reaching these new consumers might help your business grow exponentially. Are you thinking about expending your operations and sales to these new territories anytime soon ? Do you already generating a lot of business coming from tourism ? You’ll definitely need to adapt you stores experiences to new realities and consider different shopper’s behaviors.
Prodco is now present in 42 different countries. We have the technology, the knowledge and the data to help you operate territories that you might not already deeply know. Contact us today to start understanding the shoppers reality of the new territories you are looking to explore.