Maps tell stories. They outline narratives of places and people. They chart ship’s voyages, courses of history and intended routes to the future, giving context to worlds — real or imagined. They’re our collective frames of reference.

They’re also drawn by people, who inevitably have their own biases and agendas. Standard atlases are limited in what they show us, angled in the perspective of their cartographers and often the national curriculum. But by pulling maps from all corners together — along with a compendium of reports, op-eds and teamwide wisdom in this case — they reveal gaps; in geography, in thinking and in opportunity. 

To understand the state of luxury as it is now, we have to see beyond the front-page bar charts and line graphs. We have to go deeper, studying the global drivers that become the unseen slipstreams on our maps; the flowing arrows accelerating market expansion in some parts of the world yet stymying growth in others. Drivers like evolving demographic lay, cultural waves, advanced technological adoption, geopolitics, climate chaos, migration, travel, urbanisation, and yes, COVID-19’s lingering effect. 

Thorough, contextual approaches are the only way we can think globally in the current luxury landscape — a mindset that is fast becoming a prerequisite for brands who want to avoid becoming the marque of nostalgic dinner party reverie, always finitely acknowledged with the rhetorical question: Now whatever happened to them?

The Changing Luxury Market

Today, there’s an unprecedented complexity when it comes to luxury market forecasting, thanks to geopolitics, the scope of the term’s sprawling definition and the world’s overarching economic turmoil. Even the significantly tone-deaf portmanteau ‘richcession’ has its place in the dialogue. 

Because although luxury brands usually rely on just 20% of their clientele – the very and ultra-wealthy – for the majority of their sales, that percentage will see a dramatic shift in terms of location as large working-age demographics move away from Western Europe and the United States.

An interactive piece from The New York Times, published in July, shows that by 2030 many dominant powers including the UK, France, Germany, Italy, Spain, Portugal and the States will have record old-age populations, giving way to often overlooked nations like India, Mexico and regions of Southeast Asia.

It’s not a stretch then to speculate that Europe’s historic monopoly on traditional luxury could well wane as the majority age climbs. As could the USA’s significant influence on what luxury means today. But to gaze into the future — short, medium or long term — we should always, first, look back.

Europe’s Precedent & Stateside Symbols

Gratuitousness and excess have been favoured pastimes as far back as the Roman Empire, so favoured legislation was enacted to quell overindulgences. Eventually, as lands were conquered and populations assimilated, luxury wove itself into the fabric of society and culture. But its negative connotations weren’t totally shaken until the seventeenth century. 

Development of international trade routes, the rise of the bourgeois psyche and the world's growing preference for affluence all factored into the time’s newfound love for the luxuries of life. The unchecked opulence of Versailles a prime example. 

Traditional luxury of the twentieth century kicked off amid the austerity of the Roaring Twenties, powered by new technologies and mass production.

Throughout the ensuing decades, America furthered luxury’s corporatisation while nouveau riche industrialists set the tone for prevailing standards and tastes. Though always caught up in ‘goods’, luxury has never been about mere products. 

Now more than ever, luxury is rooted in craft, a history of tradition balanced with modern innovation and a certain je ne sais quoi that differentiates a timeless marque from the oversaturated brandland of the twenty-first century. 

As part of their Worldwide series, Walpole — the UK’s official sector body for luxury —  have recently interviewed various stakeholders from some of Europe’s most prominent luxury houses. Each was asked what are the qualities and characteristics of your country’s luxury sector that make it unique in the world? 

Given answers are all fascinating in their own right, and all deeply rooted in history, traditions of craft and people. A storytelling trinity that’s certainly not exclusive to the European continent.

The vastness and variety of our world, however, doesn’t exactly lend itself to a speedy (or even brisk) read. So in the interest of pace for busy people like yourselves, this intellectual voyage will be a whistlestop tour of emerging key players brands need to notice now. 

China’s Ongoing Fluctuation

A timely quality is always front of mind for writers, but China’s luxury market six months ago was notably different from what it is now. 

Following the Lunar New Year in early February, luxury’s revival looked set. Spending on goods across fashion, apparel, jewellery and beauty exceeded expectations in Q2. As a result, Morgan Stanley Research analysts predicted Chinese consumers would account for 60% of total spending growth on personal luxury goods from now to 2030. 

Cited in the same report as “the industry’s growth engine”, China’s rise has been anything but smooth sailing — the majority of turbulence coming from the pandemic’s enduring grip. Their borders opened over a year after the UK’s, and continuous lockdowns contributed to a 10-15% decrease in luxury spending. 

While the isolation did foster sophistication in the domestic market — rapidly tapped into by the likes of Gucci, LVMH and Saint Laurent in Q1 — China’s surge seems to be faltering, stymied by macroeconomic headwinds. 

Many front pages, digital and print, are changing their tune; delegating China from hotspot to sore spot. But as the last six months have demonstrated, fluctuation is, for now at least, the only guarantee. 

Full retreats from the market are fool's play, while savvy strategies are steadily working for luxury’s forward-thinkers. Store upgrades and VIC POAs are still causing seismic waves, brands simply need to be brave enough to start the ripple. 

As for high-net-worth travellers, in China and the rest of the world, the Middle East is moving up the wealthiest’s wishlists. 

The Middle East’s Ascent

Home to the GCC (Gulf Cooperation Council), the Middle East is continually heralded as a luxury playground. Boston Consulting Group estimates their luxury market to double in size by 2030 to €30-€35 billion. Yet overarching sentiment when it comes to foreign luxury brands is that they adopt a lacklustre copy-and-paste approach to the region. 

How to win in the Middle East is a far more challenging answer than why brands should win there. The latter spans the region’s:

• Rapid Growth & Demand – Thanks, in large part, to the UAE, Saudi Arabia and Qatar, Middle Eastern markets have experienced remarkable development over the past two decades.
• High Spending Power – Fuelled by oil wealth, young populations and a growing middle class. 
• Affluent Preferences – Consumer profiles tend to have a strong affinity for luxury brands and often prioritize status symbols.
• Extensive Tourism – Cities like Dubai and Abu Dhabi have become internationally coveted destinations, with tourists flocking to buy luxury goods due to a combination of lower taxes, brand variety and experiential shopping.

Despite sprawling malls already boasting a slew of European and American luxury marques, the houses themselves often throw the Middle East under ‘Other Markets’ in annual reports. 

Step one to thriving in this arena, then, is to stop treating it as an afterthought. It’s frankly insulting, and definitely not a winning tactic. The Middle East has a vast culture, a rich history and rooted traditions. They also have a uniquely extensive relationship with technology. Like any location, it’s about knowing the place and its people deeply. Not papering over the cracks with a well-worn strategy that was designed for somewhere and someone else. 

India: The Next Frontier?

India is fast becoming the next demographic sweet spot. As early as 2036, China will join the West in their overwhelmingly old populations, leaving a colossal gap for this rising superpower. 

According to an Ernst & Young report published earlier this year, the Indian economy is set to grow 7% in 2023 to become the fifth largest economy in the world. Owing to rising numbers of high-net-worth individuals and developing digital infrastructure, the country’s potential for luxury goods and services is significant. Especially while other global powers are experiencing tightening recessionary trends. 

A handful of marques are already flourishing in major cities, across the expected (fashion, jewellery, beauty, fragrance), the less expected (property, automotive) and the mildly surprising: department stores. 

Next year, Europe’s largest upmarket department store chain, Galeries Lafayette, will open a branch in Mumbai. The first of its kind in India, the project aims to fill the vacant space in the luxury department store market with over 200 international and local brands spanning fashion, lifestyle, and cuisine across the gallery. 

Though the French house has already secured first-mover advantage, the gap is still a wide one. Waiting for another right fit to prioritise India’s vastness, richness and diversity as the next frontier for a luxury that values quality, locality and craft. 

A New North Star

Luxury’s changing landscape and global expansion opens a world of opportunity for heritage brands and innovative startups alike. But as the luxury diaspora continues to relocate, ever-evolving to the skewed and partial maps humans make, we need to cease treating global audiences as homogenously European, American or Australian. 

Localisation and culture are becoming vital currencies for brands, more crucial than any other kind of capital. Because the only way to carve out a place in new territories is to be in the thick of it — the thick, rich melting pots of culture, so sticky with promise — chisel in hand, ready to work for it. 

***

Our idea of luxury isn’t limited to the lines etched into world maps or accepted mindsets. We’ve worked with the likes of India’s largest luxury property developer, retail and hospitality marques across Europe’s finest area codes and internationally renowned architects whose work dots the globe. We’ve even been to the Arctic. Never hindered by geography. To push boundaries with us, get in touch with one of our consultants via hello@matterofform.com.