Part 3/8:
The economic slowdowns and rising unemployment rates have created an environment where luxury purchases are no longer seen as a necessity. Many affluent consumers, who once splurged without a second thought, are now stretching their budgets, opting for quality and value instead of brand prestige.
Data-Driven Declines
Recent reports indicate that sales for luxury giants like LVMH and Kering group in Asia have witnessed double-digit declines. In February 2023, Gucci shuttered multiple stores in Shanghai, leaving only a fraction of its original locations open. The brand had experienced rapid growth since its entry into the Chinese market in 2010 but has since been caught in the crosshairs of changing preferences and economic hardship.