Experientality, travel retail regain traction

Watches and jewellery were the top-performing luxury categories globally.

Experientality and travel retail are “gaining back shine” and are enabling channels to access other luxury territories, a report by Bain & Company showed.

The travel retail sector is recovering following a rebound on the back of Southeast Asia and Japan.

On experientiality, monobrand category maintained its solid growth from 2022 due to the demand for in-store experiences and “shifts in consumer flows.”

Bain also said that direct retail will continue to grow with the support of tech-enabled consumers and sales through omnichannel 3.0.

Meanwhile, on luxury categories, Bain found a cross-category “quest elevation” as customers look for “less but better” purchases, mainly driven by iconic and ube-lux pieces.

Per category, watches and jewellery were the top performing sector, with iconic bags seeing a rise in spending as they are perceived as valuable assets.

ALSO READ: Asia’s luxury market undergoes reshuffling: report

For the beauty sector, Bain found that fragrances posted growth anchored on niche offerings and the recovery of duty-free, with the makeup and skincare sectors maintaining “positive trajectories.

On the other hand, shoes are on the rise in Asia but are slowing down in the West.

“Luxury is entering the ‘literally me’ era, marked by a desire to show ourselves moving beyond purely aspirational items, valuing uniqueness over status,” said Federica Levato, partner at Bain & Company and leader of the firm’s EMEA Luxury Goods and Fashion practice, co-author of today’s report. 

Levato added that demand for timeless and iconic pieces remains due to limited supply and continuous appreciation, suggesting that newcomers–despite overperforming–would have to compete with luxury giants.

”To remain relevant in the long run, brands will need to continue to channel an insurgent mindset, championing hero products and their founders’ visions, while also tooling up to sustain long-term growth by getting the business fundamentals right,” he added.