The luxury goods market in mainland China saw a significant boost in consumer spending in 2020. The report of the Bain & Company, written in collaboration with TMALL, examines the four factors that powered this increased growth rate and that will continue to offer opportunities for China’s luxury brands.
Mainland China’s luxury goods market will likely achieve 48% growth in 2020, reaching nearly RMB 346 billion. A decrease in global travel in the wake of the early Covid-19 lockdowns prompted Chinese consumers to turn to national sources for their luxury purchases, sending the domestic market climbing. This increase helped to double China’s overall share of the global luxury market in 2020, to 20%.
To determine the factors behind these impressive growth rates, the research (in collaboration with data from report contributor Tmall Luxury Division) examines four engines that powered China’s luxury goods market in 2020: Repatriation, Millennial and Gen Z shoppers, Digitalization and the Hainan duty-free shopping.
With global conditions unlikely to return to normal before 2022 or 2023, they think most luxury brands will continue to see positive domestic growth next year, to about a 30% level, at least until the second half of the year.
Link to the full report:
https://www.bain.com/insights/chinas-unstoppable-2020-luxury-market/
