Insights into US luxury consumption trends in 2022! Demand in multiple market segments surges!

It is learned that despite the adverse factors such as inflation, economic recession and sluggish consumer demand, the US luxury market remains resilient. Research from eMarket reveals why the US luxury bubble has not yet burst.

1. The impact of inflation on the luxury goods market

According to the latest forecast from eMarket, the growth of luxury goods sales in the United States will slow down significantly in the next few years. By 2026, US luxury retail sales will increase by 1.3% year-on-year, far lower than the double-digit growth (13.3%) in 2022.

Affected by inflation, low- and middle-income people cut spending on non-essential categories and are more reluctant to buy luxury goods. Although high-income people may not be affected by inflation, they cannot reverse the weak market.

2. Beauty and leather products are the favorites of luxury buyers

Data shows that in the past 12 months, the most popular category among American luxury buyers was footwear (47.3%), followed by handbags and leather goods (46.2%), and cosmetics and beauty products (45.4%).

Notably, beauty companies such as Ulta Beauty and Coty have seen strong sales growth in the past few months due to the “lipstick effect” (i.e. consumers continue to buy lipstick even in tough economic times), while LVMH Moet Hennessy Louis Vuitton also had a strong third quarter as demand for handbags rose.

3. Luxury e-commerce sales rise

According to eMarket's forecast, luxury e-commerce sales in the United States will increase by nearly 40% year-on-year to US$2.484 billion this year. In the next few years, the growth of luxury e-commerce sales will slow down.

On the other hand, the US luxury market is still larger than China's. In 2022, the US luxury market will be worth $10.925 billion, much higher than China's $7.823 billion.

4. What do luxury buyers care about most?

The survey found that discounts were the biggest motivator for luxury consumers to shop online, with nearly a third saying they would make a purchase if an online retailer offered discounts and offers.

While some brands are experimenting with AR/VR try-on tools to attract online shoppers, luxury buyers are still relatively uninterested in these technologies at the moment.

5. Luxury goods orders continue to grow in value

Luxury goods were one of the best performing categories in terms of average order value growth, ranking second after furniture and home furnishings. In 2022, the average order value for furniture and home furnishings was $141, while luxury goods was $126.

Editor ✎ Nicole/

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