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The luxury e-tailing market size is forecast to increase by USD USD 32.48 billion, at a CAGR of 9.12% between 2023 and 2028. Market growth hinges on several factors, including the rise in online spending and smartphone penetration, which has transformed consumer behavior. Social media and celebrity endorsements play a significant role, in influencing purchasing decisions and driving brand visibility. Additionally, premiumization through product design and innovation elevates brands, appealing to discerning consumers seeking unique experiences. As online platforms become increasingly integral to commerce, companies leveraging digital channels and social media platforms can capitalize on this trend to expand their market reach and engage with customers more effectively. By embracing innovation and aligning with evolving consumer preferences, businesses can position themselves for success in a competitive market landscape driven by technological advancements and changing consumer behaviors.
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In the market, traditional luxury meets digital innovation to create an unparalleled shopping experience. Reputation and exclusivity remain paramount, with consumers seeking high-end lifestyle items that reflect their discerning tastes. As cell phones become ubiquitous, luxury e-tailers leverage digital platforms to offer personalization and shopping experiences tailored to individual preferences. Offline retailers are adapting to the digital landscape, enhancing their online presence to reach a broader audience. Through AI-powered algorithms, e-tailers provide tailored suggestions, ensuring each customer receives a curated selection of luxury items. From clothes to luxury houses, consumers benefit from a wealth of options and expertise, expanding their consumer knowledge in the process. Innovation marks the industry's evolution, with e-tailers continuously striving to elevate the luxury shopping experience, blending tradition with cutting-edge technology to redefine the boundaries of luxury retail.
The rise in online spending and smartphone penetration is notably driving the luxury e-tailing market growth. The popularity of online shopping through smart devices increased over the years due to the high penetration of Internet services, improved economic growth, and the fluid interfaces of mobile applications. Shopping websites provide detailed information about products, including quality, safety measures, and user guidance, which has increased the demand for e-retailing.
However, security features of online payments, free delivery, improved online services, and the customer-friendly designs of shopping websites are also contributing to the growth of the market. Moreover, the focus on m-commerce has increased, with the penetration of smartphones and the generation of more opportunities for buyers. eBay and Amazon are the two major vendors in the online space. They have mobile applications that are compatible with Windows, Blackberry, iOS, Android, and other operating systems. These factors will fuel the growth of the market during the forecast period.
Multichannel marketing is a key trend in the market. Social media plays a major role in increasing awareness about a product. Consumers use social networking and blogs to learn about premium cosmetics products. Hence, vendors are using platforms such as Facebook, Twitter, Instagram, and YouTube to increase awareness and promote their products.
Further, many brands partner with social media influencers to increase the popularity of their brands. For example, according to an analysis by Launch Metrics, influencers represent the major Share of Voice (SOV) for Huda Beauty. Thus, factors such as the increasing penetration of the Internet and smartphones and the growing number of customer-engagement practices by vendors of premium cosmetics have contributed to the overall sales volume and revenue of market vendors over the past few years.
Strict competition from offline channels may impede market growth. Consumers prefer to buy premium products such as personal care products, wine, spirits, home decor, home furnishings, and furniture from offline stores, as they can examine the products physically before purchasing. Moreover, many consumers are hesitant to perform high-value transactions online due to cybersecurity concerns.
Moreover, the offline segment of the global home decor market is influenced by the increasing number of product-specialty stores and brand-specific stores. Consumers prefer these stores owing to their high credibility. Moreover, employees of these stores can understand the needs of consumers and suggest products that suit their needs and budgets. Thus, offline stores pose a major threat to the global luxury e-tailing market.
The market share growth by the personal luxury segment will be significant during the forecast period. This segment includes watches, jewelry, accessories, shoes, bags, fragrances, cosmetics, glasses, and headphones, among others. The preference for online shopping is increasing, with the growing Internet penetration rate and the increasing number of smartphone users worldwide. A wide range of premium personal goods are available online in various categories, price ranges, and brands.
The personal luxury segment showed a gradual increase in the market share of USD 30.79 billion in 2018. Major manufacturers of personal goods such as cosmetics are expanding their professional skincare e-retail businesses to gain a competitive advantage over Internet-only retailers. They are building their own web portals and creating partnerships with other distributors to sell professional skincare products online. For instance, Beiersdorf AG has its online presence in China in partnership with NetEase Kaola. Such partnerships can help increase the online sales of luxury personal goods during the forecast period.
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APAC is estimated to contribute 51% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional market trends, drivers, and challenges that are expected to shape the market during the forecast period. The growth of the market in APAC is driven by factors such as the growth of the real estate sector for residential and commercial properties. Japan, China, and South Korea are the key revenue contributors. In addition, wide product portfolios and the launch of new and innovative products will also fuel the market growth during the forecast period. The growing Internet penetration is also expected to drive the online sales of luxury products in APAC.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
ASOS Plc - The company offers luxury E-tailing of men's and women's clothing.
The market growth and forecasting report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market research and growth report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.
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In the ever-evolving landscape of the market, driving forces such as new product launches and the demand for growth shape the industry's trajectory. Despite international market restrictions, e-tailers thrive by leveraging data collection and statistics to understand demand-side dynamics and macroeconomic indicators. Target competitors adapt to import/export regulations, seeking opportunities in the global market. Virtual shopping assistance enhances the consumer experience, fostering brand loyalty through influencer collaborations and personalized interactions. Leading e-tailers like Charms And Chain and Exclusively set industry standards, supported by industry experts, printed documents and research papers published in industrial magazines. As the market continues to evolve, companies refine their company profile to meet the evolving needs of luxury consumers, bridging the gap between tradition and digital innovation in the luxury e-tailing realm.
Market Scope |
|
Report Coverage |
Details |
Page number |
171 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 9.12% |
Market Growth 2024-2028 |
USD 32.48 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
8.15 |
Regional analysis |
APAC, North America, Europe, Middle East and Africa, and South America |
Performing market contribution |
APAC at 51% |
Key countries |
China, US, Japan, Italy, and France |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
ASOS Plc, Authentic Brands Group LLC, Bed Bath and Beyond Inc., Burberry Group Plc, Chanel Ltd., Charms and Chains, Compagnie Financiere Richemont SA, Crate and Barrel, Harrods Ltd., Hennes and Mauritz AB, Hermes International SA, Hudsons Bay Co., Inter IKEA Holding B.V., Kering SA, Luxuryperfume.com Inc, LVMH Group., Moda Operandi Inc., Nordstrom Inc., Ralph Lauren Corp., and SDI (Brands 2) Ltd. |
Market dynamics |
Parent market growth analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the market forecast period. |
Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by Channel
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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