The jewelry segment continued its positive momentum, heading for a strong result for the year, even as the overall personal luxury goods market lags.
There are three potential scenarios for the market this year, according to a report consultancy group Bain & Company released together with Italian luxury goods industry group Altagamma last week. The most likely scenario for the 12 months is a moderate decline of between 2% and 5%. The second option will see the market between 2% smaller and 2% larger. In the most extreme scenario, the personal luxury market would experience an extended downturn, shrinking 5% to 9%.
Following a strong post-pandemic recovery that pushed the personal luxury goods market to EUR 369 billion ($425 billion) in 2023, the sector slipped 1% to EUR 364 billion ($419.2 billion) in 2024. The first quarter of this year was expected to have brought a further dip of 1% to 3%.
While the outlook for the overall luxury goods sector is weaker, some key segments continued to perform strongly, most prominently experiential luxury, which is gaining popularity with Gen Z consumers. However, the jewelry segment’s results were still strong, with robust appetite for both ultra-luxury items and more accessible aspirational products.
Sluggish tourism has impacted the European market, but strong local demand, including continued interest in jewelry, has partially offset that decline, Bain noted.
Global luxury spending is under strain, with younger buyers questioning the relevance and worth of luxury products, Bain commented. The US and China, the two largest markets for luxury, are facing softened demand amid economic uncertainties, including tariffs. However, there is some hope, as Chinese consumers show a growing interest for emerging local luxury brands, signaling a shift in consumer preferences.
“Although demand is easing in the short term, the luxury sector has consistently demonstrated an extraordinary resilience — buoyed by a growing global consumer base and deeply rooted emotional drivers,” said Claudia D’Arpizio, Bain & Company senior partner and global head of the firm’s fashion and luxury practice. “Across generations, drivers linked with self-reward, status, personal identity, and the celebration of achievements will continue to drive engagement, reinforcing and building the lasting relevance of luxury within its consumers’ lives.”
Image: A young woman wearing diamond jewelry. (Shutterstock)
