UK’s Luxury Market On Rise Thanks to Arab, Russian and Chinese Shoppers
The luxury market is growing year on year. The number of luxury consumers is at an all time high of 380 million, which, according to Boston Consulting Group will reach 440 million by 2020. With this in mind it comes as no surprise that the UK’s luxury market is worth £6.6 billion and is expected to double within the next 3 years. UK’s luxury market attracts consumers from all over the world, in particular, China, Russia and the UAE. Statistics from Visit Britain in 2014 show that overall in 2013 international visitors spent £21.0 billion in the UK. This included 196,000 visitors from China who spent a total of £492 million on luxury shopping and £527 million being spent by families from the Middle East. Arab shoppers spend approximately 4.5 million a day in UK, but they are biggest spenders worldwide.
This data shows how vital it is for luxury retailers to fully embrace digital marketing so their brands will reach these consumers, prompting them to travel thousands of miles to buy their products.
Before completing their purchases, a study by Global Blue in 2013, found that 90% of luxury buyers from China plan their purchases prior to travel. Visitors from Brazil and Russia have also been found to carry out the most research, followed by the US, Germany, England, France and Italy where more than two-thirds research online before making a purchase. Japanese luxury shoppers closely follow them where half conduct online research (study carried out by Google and IPSOS in 2013). With easy access to connected devices, online research is generally just the start. Social networking and watching online videos are considered before purchase as well as reading reviews, blogs and forums. In light of all the actions carried out via digital medium it may come as a surprise that only 7-19% of purchases are made online compared to 81-93% of luxury purchases made in store. This is most likely due to buyers preferring to touch and feel a product, as well as concerns that they may be sold a counterfeit item.
Though the majority of sale transactions are carried out in-store, shoppers are heavily reliant on digital devices to help them decide on what to buy, with an average luxury shopper owning 3.1 connected devices. Therefore, luxury retailers had to rethink their methods of engaging and enticing customers.
With the constant need to attract more consumers from all over the world, it is essential for luxury retailers to promote their brands using a variety of digital campaigns. Though the majority of sales do occur in the shop itself, these digital campaigns will lead to better brand awareness, which will generally prompt users into research of the brand and subsequently increase sales.