Is the US in recovery mode now or is it just a blip? – Vogue Business
Fri 21 May
Bain has upgraded its forecasts for the global luxury market to recover to pre-pandemic levels as soon as 2021 based on an earlier-than-expected recovery across the US and continued growth in China.
Luxury may be roaring back in the US, recovering from the pandemic slump quicker than the industry expected.
The US market, together with China, has emerged as the force behind the luxury industry’s recovery, which is happening faster than anticipated. The most optimistic scenario, published by consultancies Bain & Company and Altagamma in their annual spring update, sees the personal luxury goods market growing as much as 5 per cent in 2021 over 2019, reaching a total value of between €280 billion and €295 billion. In November, the consultancies estimated a much slower recovery.
“We are definitely more positive, in particular we were not expecting such a strong rebound of the US market,” says Claudia D’Arpizio, partner at Bain & Company. “It’s a clear second engine of growth after China.”
Brands and retailers are continuing to invest in strategies that have worked well during the pandemic, focusing on tight management of inventory, smaller orders and digital presence.
Retailers that were cautious in ordering summer collections are now trying to catch up as they report increases in footfall and spending, notes Emily Silverstein, vice president of Tomorrow-owned sales, merchandising and distribution agency Goods & Services. “We’re guiding our brands to find a strategic medium of having the inventory we need to chase business while also managing liability,” she says.