Expensive Luxury Gadget

The luxury goods market has been on an upward climb for many years. Apart from the setback caused by the 1997 Asian Financial Crisis, the industry has performed well, particularly in 2000. In that year, the world luxury goods market – which includes drinks, fashion, cosmetics, fragrances, watches, jewelry, luggage, handbags – was worth close to US$170 billion and grew 7.9 percent. The largest sector in this category was luxury drinks, including premium whisky, Champagne, Cognac. This sector was the only one that suffered a decline in value (-0.9 percent). The watches and jewelry section showed the strongest performance, growing in value by 23.3 percent, while the clothing and accessories section grew 11.6 percent between 1996 and 2000, to US$32.8 billion. North America is the largest regional market for luxury goods: unlike the modest 2.9 percent growth experienced by the Western European market, the North American market achieved growth just under 10 percent. The top ten markets for luxury goods account for 83 percent the market, and include the U.S., Japan, Taiwan, Germany, Italy, France, UK, Brazil, Spain, and Switzerland.
Market trends
The three dominant trends in the global luxury goods market are globalization, consolidation, and diversification. Globalization is a result the increased availability these goods, additional luxury brands, and an increase in tourism. Consolidation involves the growth big companies and ownership brands across many segments luxury products. Examples include LVMH, Richemont, and PPR, which dominate the market in areas ranging from luxury drinks to fashion and cosmetics. Leading global consumer companies, such as Procter & Gamble, are also attracted to the industry, due to the difficulty making a prit in the mass consumer goods market.