Despite mounting global social and economic challenges, China’s luxury goods market finished 2021 with strong double-digit growth overall, with some brands exceeding a 70% increase. Chinese consumers have continued to shop mostly in the mainland, given limited international travel options. This led to a 48% increase of China’s domestic sales of personal luxury goods in 2020, and another 36% in 2021 totalling nearly RMB 471 billion, a near doubling in just 2 years. Domestic spending in the luxury market also continues to be strengthened due to duty-free opportunities, and digitalization.
Following 2020 trends, market growth has varied significantly across brands, ranging from 10% to more than 70%, and categories. However, 2021 was very contrasted: all categories saw strong year-over-year increases in the first half of the year, while growth throughout the second half of 2021 dipped.
Bain’s research identified three major trends that are expected to shape the luxury market for years to come. Primarily an acceleration of several of the growth engines we noted in 2020, these trends indicate even stronger implications for personal luxury brands in the future.