LONDON: Retail spending on branded luxury goods is set to rise by 17% in 2011, according to a new report from Verdict Research.
The report, Global Luxury Retailing, indicates that consumers will ignore volatile economic conditions and spend big on high-end goods.
Asia-Pacific (excluding Japan), which has escaped the worst of the global downturn, is this year set to replace the Americas as the world's second-largest luxury region, taking a share of 27%. China, South Korea and Taiwan were identified as nations making a particularly large contribution to regional growth.
But Europe will remain the largest luxury region with a share of 36% for 2011.
Globally, this year's growth rate quickened from the 10% expansion Verdict recorded for last year.
But the report warned that luxury brands must adapt to changing consumer shopping habits – such as an increased willingness to buy expensive goods online – if they were to maintain growth.
Ruta Perveneckaite, retail analyst at Verdict, said that many websites currently did not adequately reflect this trend.
"Too often luxury houses adopt practices which are common to the high street, missing the opportunity to use the new channel to further differentiate themselves as luxury retailers and, most importantly, strengthen their brand image and justify premium pricing," she added.
"There remains much confusion in the luxury goods sector surrounding how to guarantee a premium service online and there is a distinct reluctance to engage customers through digital marketing and mobile platforms."
Nevertheless, the Verdict data suggested that spending growth would be maintained over the years to come, with the market expanding by almost 65% between 2010 and 2015.
Accessories were identified as the luxury product category that would record the quickest growth rates over the next two years.
The report, Global Luxury Retailing, indicates that consumers will ignore volatile economic conditions and spend big on high-end goods.
Asia-Pacific (excluding Japan), which has escaped the worst of the global downturn, is this year set to replace the Americas as the world's second-largest luxury region, taking a share of 27%. China, South Korea and Taiwan were identified as nations making a particularly large contribution to regional growth.
But Europe will remain the largest luxury region with a share of 36% for 2011.
Globally, this year's growth rate quickened from the 10% expansion Verdict recorded for last year.
But the report warned that luxury brands must adapt to changing consumer shopping habits – such as an increased willingness to buy expensive goods online – if they were to maintain growth.
Ruta Perveneckaite, retail analyst at Verdict, said that many websites currently did not adequately reflect this trend.
"Too often luxury houses adopt practices which are common to the high street, missing the opportunity to use the new channel to further differentiate themselves as luxury retailers and, most importantly, strengthen their brand image and justify premium pricing," she added.
"There remains much confusion in the luxury goods sector surrounding how to guarantee a premium service online and there is a distinct reluctance to engage customers through digital marketing and mobile platforms."
Nevertheless, the Verdict data suggested that spending growth would be maintained over the years to come, with the market expanding by almost 65% between 2010 and 2015.
Accessories were identified as the luxury product category that would record the quickest growth rates over the next two years.
Data sourced from Verdict Research; additional content by Warc staff
