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Global Powers of Luxury Goods 2023: A Quantum Leap Towards Sustnability
The luxury goods industry has experienced an unprecedented revival since the pandemic’s impact, with companies not only regning pre-pandemic profitability levels but also embarking on a transformative journey towards an environmentally sustnable circular business model. This shift is being propelled by customer demand and escalating regulatory pressures, while technological innovations are accelerating this green transition.
In harmony with traditional craftsmanship and exclusivity, luxury brands have now become pioneers in adopting cutting-edge digital technologies such as , and the Internet of Things IoT. These advancements aren’t merely reshaping consumer experiences; they’re revolutionizing sustnability efforts, supply chn management, and product authenticity across the industry.
Authors: Giovanni Faccioli Karla Martin Evan Sheehan
Recovery and Growth: The Top 100 luxury goods companies witnessed a sales surge of US$347 billion in FY2022 compared to US$305 billion in the previous year. This robust performance underscores an industry-wide recovery from pandemic effects.
Market Dominance: Just 17 of these giants, with sales exceeding US$5 billion each, accounted for nearly three-quarters 70 of total Top 100 sales revenue, while smaller players contributing less than US$1 billion in sales collectively held only a minor share 6.4.
Net Profit Surge: Companies reporting net profits had an impressive composite net profit margin increase to 13.4 in FY2022, surpassing pre-pandemic levels.
The luxury industry's journey towards sustnability is exemplified through its embrace ofand the circular economy model:
Traditionally synonymous with craftsmanship and exclusivity, luxury brands are now pioneeringled innovations to enhance personalized experiences. From chatbots providing real-time customer support to virtual assistants offering styling advice, technology is redefining consumer interaction.
The luxury industry has embraced the circular economy concept, leveragingfor Digital Product Passports DPPs and other digital tools to trace products' lifecycle and encourage sustnable practices. This shift not only minimizes waste but also fosters responsible consumption patterns.
This transformation involves collaboration among stakeholdersbrands, suppliers, retlers, and consumersto ensure transparency across the supply chn, from raw material sourcing to final product disposal.
The integration ofin luxury goods production optimize resources, reduce waste, and enhance efficiency. This technological pivot is expected to set a new standard for sustnability in the industry, potentially influencing broader consumer behaviors and market practices.
Giovanni Faccioli: Fashion Luxury Market Leader [email protected]:[email protected]
Karla Martin: Managing Director, Deloitte Consulting LLP [email protected]:[email protected] +1 415 218 7645
Evan Sheehan: Global Retl, Wholesale Distribution Sector Leader [email protected]:[email protected] +617 437 2734
highlights the industry’s journey towards sustnability through technological innovation. As the luxury goods sector evolves, companies are encouraged to integrate practices into their operations for a more sustnable future.
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Luxury Goods Industry Sustainability Transformation AI Driven Circular Economy in Fashion Top 100 Brands Profit Surge Post pandemic Digital Product Passports for Traceability Collaboration for Supply Chain Transparency Future Outlook on Sustainable Luxury