The luxury market is poised for a comeback by 2030 – here’s what US and China clients want
A new McKinsey and Business of Fashion report reveals how aspirational spending, emotional connection and experience are reshaping the luxury sector
Although the luxury market has been affected by economic headwinds in recent years – with conflict in the Middle East and tariffs imposed by US President Donald Trump causing chaos globally – it’s projected to make a comeback by 2030, with China and the US expected to lead that surge in growth.
Here are some key takeaways from the report, which drew on data from over 2,000 luxury clients across different spending tiers in the US and China.
Shopping as self-expression
One major finding from the report suggests that aspirational and established luxury clients – those who spend between US$5,000 and US$50,000 on luxury goods each year – have been systematically underserved. Yet this segment represents some US$70 billion to US$90 billion in potential growth for the sector.
Self-expression has become the defining driver that modern luxury shoppers stand by when it comes to making a purchase. Both the American and Chinese buyers surveyed said they tend to favour emotional connection with a brand over logo recognition, heritage and even craftsmanship.
In China, brand desire is more closely tied to visibility and recognition, with 33 per cent of established luxury clients, and 47 per cent of occasional and aspirational ones, saying they shop to feel more confident.
Exclusivity or artificial scarcity?
That doesn’t mean today’s luxury client doesn’t care about special treatment, though. About 40 per cent of US luxury clients say limited editions, early product drops and loyalty rewards create a sense of exclusivity. In China, the luxury buyer is more keen on bespoke products and a personalised approach – aspects that are especially important for the Gen X demographic, which holds significant spending power.