Webinar: The Luxury Industry 2023: an Outlook and Beyond (Review)
Luxury expert Dr. Frank Müller recently discussed the challenges facing the luxury industry in a webinar, highlighting that while the industry has been thriving for the last 30 years, there are high challenges in the near and long term future. He outlined three factors contributing to the industry’s success: new markets and internationalization, incremental revenues and margins through vertical integration along the value chain, and the online and logistics revolution leading to home shopping.
Dr. Müller also discussed the impact of the global economy on the luxury industry. Fluctuations in GDP have repercussions on the luxury sector, and interest rates affect households and the borrowing costs for enterprises, leading to higher production costs, public price increases, and company margin cuts. Inflation has impacted the real life of consumers, with some countries experiencing a decline in real wages, particularly affecting the business of prestige and luxury brands. Consumer spending is also affected by the development of income in various countries.
The luxury industry must adapt to changing consumer behavior and preferences to continue its success in the future. One major shift in consumer behavior is the growing demand for sustainability and ethical practices in the production of luxury goods. Luxury brands also face competition from smaller, independent brands that offer more unique and personalized experiences. Additionally, e-commerce has disrupted the traditional retail model, forcing luxury brands to develop their online presence and omnichannel strategies.
In conclusion, the luxury industry must be agile and adaptable to thrive in a constantly evolving marketplace. While the challenges are significant, the industry has been booming in the past. It can continue to succeed by keeping up with changing consumer preferences and adapting to the changing global economy.
Would you like to learn more about how your company can master the challenges ahead, find out more about our Program in Luxury Management.
Watch the complete webinar: Video
Download the accompanying slides: Download