Buying First Luxury Item at 15... Today's Elementary Students Are Future Big Spenders

Increase in Wealthy Class and Influence of SNS
MZ Generation Accounts for 80% of Sales

Due to the influence of social networking services (SNS) and others, the age group consuming global luxury fashion brands is getting younger. It is predicted that by 2030, the Alpha generation (born after 2010) will become a major force consuming the majority of luxury goods alongside the MZ generation (Millennials + Generation Z).

"By 2030, young generations will account for 80% of the global luxury market"

Following the news of a price increase for luxury brand Chanel, citizens lined up in front of the luxury goods hall at the Lotte Department Store main branch in Jung-gu, Seoul, on the morning of the 13th, hoping to purchase Chanel bags.
[Photo by Yonhap News]

According to CNBC on the 17th (local time), consulting firm Bain & Company recently reported that "by 2030, young generations (MZ generation and younger) will account for 80% of global luxury fashion brand sales." The firm forecasts that the consumption share of Generation Z and the Alpha generation (currently under 13 years old) will make up about one-third of the luxury market by 2030.

The report states that the average age for Generation Z's first luxury purchase is around 15, which is 3 to 5 years earlier than the Millennial generation. This is attributed to the increase in affluent consumers, the spread of SNS, and the popularization of online sales channels, making luxury consumption easier.

Bain & Company also noted that despite rapid inflation, resulting interest rate hikes, and economic recession, luxury fashion brand sales were not impacted last year; rather, global sales increased by 22% compared to the previous year, reaching 353 billion euros (approximately 471 trillion won).

Among these, the United States was recorded as the country with the highest luxury fashion brand consumption last year. Sales increased by 25% from the previous year to 121 billion dollars (approximately 150 trillion won). While China’s sales decreased by 1% due to the spread of COVID-19 and lockdowns, Europe saw a 27% increase as American tourists increased.

Meanwhile, Bain & Company forecasts that this year’s global luxury market sales size will depend on China’s economic activity resuming under 'With Corona' policies and the economic conditions in the United States and Europe, but it is expected to grow by about 3 to 8%.