After the pandemic, luxury market will increasingly depend on China In 2025, Chinese customers will account for up to 49% of the world's luxury market
It is now clear that 2020 can be considered an annus horribilis for the world of luxury. Between the cancellation of physical fashion weeks, the closure of retail and the huge delays accumulated in the schedule of the production chain, the luxury market will face a long phase of recovery – a phase in which the Chinese market will be even more fundamental than before. One of the effects that the crisis from Covid-19 had, especially in its initial moments, was to emphasize how important the volume of consumption and production from China was to the fashion industry that, immediately after Wuhan's initial lockdown, had faced the first series of losses: the market shutdown in Asia, followed in the early months of the year to that in the West, caused a 25% loss in industry profits in the first quarter. At the same time, however, China will also be the main economic rebound base for fashion. A report by Bain & Company and Altagamma says that:
Luxury shopping is likely to restart first in China if the virus remains under control there; continued restrictions on travel will mean that many purchases that would have been made abroad will happen in China.
In this sense, the current crisis in Covid-19 is likely to act as an accelerating factor for the development of market trends which, without a pandemic, would have evolved much more slowly. The projections illustrated by recent reports speak of a world in which the economic axes of luxury will move to the East. Other changes planned for the future include a more widespread integration of phygital that will lead to the birth of a new omnichannel system; a drastic downsizing of both the role of the physical store, the distribution network and the role of shopping malls, as well as new importance attributed to the concept of sustainability.
