Wedding Finance

Designer labels for 15 year olds? The new generation splashes luxury-Bath

By Mimosa Spencer

PARIS, Nov 15 (Reuters) – Luxury buyers are increasingly young and form a group that should support the growth of the sector in the years to come with purchases made from the age of 15, according to forecasts by the consultancy. Bain advice released on Tuesday. .

Concern has grown in recent months that the appetite of financially strained Gen Z consumers for “ambitious” purchases, ranging from $300 bucket hats to $900 sneakers, could wane, as inflation and the rising cost of living are hurting the incomes of young American and European consumers while Chinese youth are struggling. with high unemployment rates.

But third-quarter results showed European luxury goods companies continued to defy the overall lackluster economic climate, as consumers used their savings and a pent-up appetite to shop to splurge on designer clothes as as pandemic restrictions ease.

Young Gen Z consumers, or those born between 1996 and 2012, as well as so-called millennials born in the 1980s and early 1990s, have fueled growth in the luxury market this year, according to the Bain report. .

These generations started making luxury purchases between the ages of 18 and 20. Their heirs — born between the late 1990s and mid-2020s — will start buying high-end products even earlier, at age 15, Bain said.

“They were exposed to these kinds of brands earlier through digital technologies and through social media which made them very savvy luxury watchers since childhood,” said Bain partner Federica Levato.

High-end brands, including megabrands like LVMH’s Louis Vuitton and Kering’s Gucci, have been cultivating young adults and twenties in recent years, as evidenced by a wave of streetwear and gender-specific styles sweeping the runways.

Many are embracing the metaverse, like Balenciaga and Dior, to engage teens and young adults with affordable ways for them to create virtual identities on gaming platforms. As these younger generations enter the workforce, they will have even more money for luxury goods, Levato said.

Bain expects industry sales growth to reach 353 billion euros ($368 billion) this year, above the upper limit of its previous estimate of 330 billion euros in June. This would represent a growth of 15% compared to 2021 at constant exchange rates.

LVMH chief financial officer Jean-Jacques Guiony said last month that the luxury industry was not an indicator of the general economy. He said that while he was not recession-proof, “when it happens, it usually doesn’t last very long.”

($1 = 0.9601 euros) (Report by Mimosa Spencer, edited by Silvia Aloisi and Bernadette Baum)