![With reports that Formula One race organisers are considering scrapping or relocating several Middle Eastern races this year due to heightened security concerns, the events industry is once again confronting the reality of operating in an unpredictable world (Image source: @ Scuderia Ferrari Club https://sfcriga.com/ Scuderia Ferrari Club]])](https://biz-file.com/c/2603/806699-64x64.jpg?1)
Top stories
![The damage to Tesla’s brand value by Elon Musk's actions exceeded Brand Finance’s initial predictions (Image source: @ Equilar https://www.equilar.com/ Equilar]])](https://biz-file.com/c/2603/806661-300x156.png?2)
Marketing & MediaCMOs must bridge the gap between the spreadsheet and the story… or become extinct
Pieter Geyser 3 days
Luxury retail execs bullish about rising revenues
The rising number of high-net-worth individuals globally is a key driver behind the expansion of the luxury retail market, new global research by communication technology company Communications Specialist Ltd shows.
Source: ©tea - 123RF
Its study with senior executives at luxury retailers with total annual turnover of $3.1bn across Asia, Africa, Europe, the US and South America found they are forecasting annual growth of more than 5.6% for the luxury retail sector over the next three years. The research by Communications Specialist Ltd found growing confidence about rising revenues at their firms and for the market as a whole.
The senior executives questioned for the research highlighted the growth in high-net-worth individuals and mass affluent people across the world as the biggest reason for rising sales.
Sales and margin growth
Around 80% of executives said growing wealth globally is boosting sales while more than half (53%) pointed to improved performance by luxury retailers and pent-up demand following the Covid-19 pandemic. Around a third (31%) say increased sales are down to more personalised offers from luxury retailers for clients.
The combination of factors is translating into higher sales – almost all (96%) questioned believe revenues at their firm will be higher this year than in 2022. More than a fifth (22%) expect revenues to be 50% higher this year.
It is a similar story when comparing revenues to pre-Covid results from 2019 – 96% say revenues this year will be higher with just 4% predicting sales will still be down on pre-Covid levels. They are slightly less optimistic about the market as a whole – 92% say it will perform better this year than last while 98% say revenues this year will beat pre-Covid levels.
Rising revenues are not down to price-cutting, the research found. Around 94% say margins this year will be higher than last year while 90% say margins will be higher than pre-Covid levels. Up to 40% say margins will be significantly higher than pre-Covid levels.
Kevin Buchler, chief marketing officer at Communications Specialist Ltd, said: “The luxury retail sector globally is firmly on a growth path with the market set to expand by 5.6% a year for the next four years. It is not simply a case of the post-Covid recovery, as executives point to the rising number of wealthy individuals worldwide as well as increasing sophistication and personalisation of offers from retailers.”
