The Retailer Autumn Edition 2022

AUTUMN 202 2

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Canada A combination of increasing wealth, tourism and more affordable prime retail property have made Canada one of the top destinations for luxury retailers, according to analysts. Statista says that the luxury goods market in Canada was worth US$6.25bn in 2022 and will grow by 4.37% a year (CAGR 2022-2027). Luxury fashion is the largest segment of that market valued at US$2.29bn in 2022. Retail Insider says that there has been an influx of luxury brands opening flagship stores in major urban centres like Toronto and Vancouver over the last two years, including Chanel, Hermès and watchmaker Richard Mille. Nearly 40% of the 50 new international retailers entering Canada in 2021 were in luxury, added Retail Insider. Mexico As reported by Vogue Business, the $4.7 bn Mexican luxury market is maturing for fashion and luxury brands willing to go the extra mile in terms of service that’s expected by the consumer. Real estate developers and department stores are continuing to expand into second and third tier cities, targeting both locals and tourists, where they continue to dominate the market. From cosmetics to luxury goods, Millennials and Gen Z are buying signif icantlymore from outside their home countries than Gen X and Boomers. In fact, they are buying at or near twice the rate of Boomers in every category, including apparel. Faced with stagnant or underperforming domestic sales, retailers that can capitalise on international growth, by shifting regional ecommerce focus and building D2C capabilities tuned to the behaviours and preferences of burgeoning markets, will thrive.

From cosmetics to luxury goods, Millennials and Gen Z are buying signif icantly more from outside their home countries than Gen X and Boomers. In fact, they are buying at or near twice the rate of Boomers in every category, includ ing apparel.” Germany German luxury consumers are among the most demanding in the world but also among the most loyal. According to Statista, revenue in the Luxury Goods market amounts to US$12.14bn in 2022. The market is expected to grow annually by 8.18% (CAGR 2022-2027). The market’s largest segment is Luxury Fashion with a market volume of US$4.52bn in 2022. In the Luxury Goods market, 26.2% of total revenue will be generated through online sales by 2022. According to Roland Berger, the German luxury market is growing 5% a year faster than the overall global luxury market, with the strongest year-on-year growth (20%) from designer clothing and accessories, watches, and jewellery. This must be understood in the context of the German luxury market in Europe still lagging behind France and Italy. Australia The Australian luxury sector has grown on the back of the recent com modity boom, and annual luxury sales are predicted to grow 2.4% to AU$4.5bn in 2026 according to IbisWorld. Brian Wu, owner of premium multi-brand boutique Incu and operator of APC and Rag & Bone’s Australian businesses, says brands are piling into Australia because they have performed so badly in other markets. “Australia is a market with potential. Brands see Australia as being so positive right now.”

Chris Field chris@retailconnections.co.uk 0777 576 0876