01/01/2022
Strongly dependent from “global shoppers”, the personal luxury goods market is expected to be hit hardest across all FMCG (fast-moving consumer goods) markets in 2020 by the economic consequences of the Covid-19 pandemic. With sales predicted to contract between 18% and 35% in 2020, the luxury industry faces a challenges like never before and will have to rethink itself to successfully weather the crisis and emerge even stronger.
Amid the coronavirus pandemic, many luxury companies have pivoted to address urgent public-health needs: factories that produced scarves and perfumes now manufacture face masks and hand sanitizers, and many luxury groups have made monetary or product donations to hospitals and other not-for-profit organizations.
In a longer-term, with millions of people relying on the luxury-goods industry to make a living, this unprecedented crisis forces luxury players to jump into the future now.
Unprecedented recession
With 20 to 30 percent of revenues generated by consumers making luxury purchases outside their home countries, the industry is heavily dependent on "global shoppers". [1] The suspension of most international travels therefore had an immediate effect on sales, and the impact was amplified by the closure of shops and the great confinement which followed the global spread of the virus.
