THE STATE OF THE LUXURY MARKET TODAY
A feeling of optimism over growth prospects prevails in the luxury industry in 2018. According to the Luxury Daily and Unit Marketing’s second annual survey, nearly half of the luxury professionals surveyed (47%) believe that the situation in the luxury market in general will improve in 2018 and more than two-thirds of them believe that conditions for their own companies will get improved as well. These two results are significantly better this year than they were in 2017.
ADVERTISING, MARKETING AND INNOVATION STRATEGIES
The digital revolution continues to disrupt retail trade in general and luxury is obviously not invulnerable to all these changes, although the survey reveals that more and more luxury companies have become this year aware of the potential of web marketing and e-commerce. Innovation, both in products and services, also offers a path for growth in the future for many players, while political upheavals continue to negatively affect the luxury market today.
In 2018, the majority of luxury goods and experience marketers (58%) plan to spend more on advertising, social media, website enhancement and Internet advertising. The three biggest growth challenges for marketers of luxury goods and services are prospecting, intense and increasing competition and price competition.
KEY TRENDS IMPACTING THE LUXURY MARKET
The cost of transactions in the luxury market also hinders business growth. However, this year, retailers of luxury products and services are less faced with the challenge of selling to customers who are not willing to spend, which is a positive change for professionals. Overall, luxury goods and services specialists consider the Internet and social media as the solution that must be mastered in 2018 to reach new customers, create a good brand image and make connections.
Three trends emerge as the most positive for the growth of the luxury industry: innovation and diversification in products and services, social media and digital transition. On the other hand, the most negative trends affecting companies in the luxury market are political instability and conflicts, followed by monetary policies and the challenge of finding and maintaining qualified employees.
This survey was conducted from August 1 to September 31, 2018, among 600 luxury business professionals from all around the world. The results provide an overview of the current luxury industry situation, its challenges, its opportunities and its prospects.
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