The global luxury leather goods market size was valued at USD 48.0 billion in 2018 and is expected to expand at a healthy CAGR over the forecast period. The rising demand for attractive leather products as a symbol of status as well as the inclination of luxury consumers toward various international brands is driving the demand for luxury leather products. Some consumers believe that high-priced products are of better quality and hence they spend limitlessly to buy the brand name and tag.
Buying luxury products is a game of psychology. Many users buy expensive leather products to reward themselves for their hard work, which they typically can’t afford. The majority of the purchasing is done by rich class people, but it is also popular among those who are not financially comfortable. The reason is to show off to others and maintain their popularity in a group. Sometimes consumers are so attached to any brand that they are ready to spend a huge amount on the purchase of luxury products, hence increasing the sales of luxury leather products in the market.
Rising fashion consciousness among men, along with women, is attracting various brands to expand their product portfolio in the men’s segment. Apart from the traditional luxury brand, recent affordable luxury brands are also gaining importance in the market. Various startups have come up with customized luxury products as per the demand of consumers. For instance, 1Atelier allows customers to customize the color and hardware of their leather handbags. Strong brand recognition, along with high unit price, is driving the sales of luxury leather products in the market.
The emergence of the latest technologies such as 3D printing and robotics helps in producing trendy leather products in minimum time. However, the unethical killing of various animals for producing leather products is attracting the attention of various animal lover consumers. Rising concerns over animal killing among luxury consumers have certainly affected the demand for such products in the market.
Considering this as a major constraint for the leather industries, some companies are producing artificial leather with the help of certain chemicals and plants. For instance, Modern Meadow has raised USD 53.4 billion to produce animal-free lab-grown leather. The startup grows collagen using living cells and tans the assembled collagen sheets to produce lab-grown leather.
On the basis of the distribution channel, the market has been divided into offline retail and online retail. Offline retail was the largest contributor to the market growth in 2018 owing to the high pricing and quality factor of luxury products. Consumers prefer to do physical checks before spending such a huge amount on such products, thereby driving the offline channel segment.
The online channel is anticipated to witness the fastest growth over the forecast period. Both multi-brand e-retailers and own branded online stores are used to interact with the consumers. The luxury products are not readily available at various shops and hence are accessible to limited consumers. People living in distant and rural places can easily purchase such items through online channels. Moreover, the multi-brand online platform can reach out to time-pressed consumers, who do not have much time to browse through different mono-brand sites, thereby giving a wider opportunity for online retailing of luxury products.
By product, the market is divided into footwear, bags, accessories, and others. Footwear accounted for the largest share of 34.8% in the year 2018. Leather shoes are popular among both genders for their status symbol and demand for formal outfits. It is not only used in casual dresses but also for formal attire. Luxury footwear is more of a fashion statement and footwear shoppers spend more and buy more frequently as compared to other leather products, thereby making it one of the largest markets.
Handbags are anticipated to witness the fastest growth over the forecast period. All kinds of travel bags, office bags, protective leather handbags for electronic items, small purses, and fashionable handbags and wallets are covered in this segment. Increasing domestic and international travel, growing demand for designer leather goods, and considering female handbags as a status symbol for women are driving the segment. A number of women consider the purchase to be an investment in their style and personality and hence they prefer to buy it more frequently.
Europe emerged as the largest market in 2018. In Europe, the U.K. held the major market share, followed by Germany, Italy, and France. Some of the prominent luxury brands such as Gucci, Versace, and Louis Vuitton have their manufacturing plant based in Europe. Europe being one of the most attractive tourist destinations always attracts millions of travelers from around the world. Business tycoons to high-class women travelers prefer to buy expensive leather shoes to handbags during their visits, thereby increasing the market share of luxury products.
The Asia Pacific has witnessed significant growth over the past few years on account of increasing the buying pattern of luxury goods. India, China, and Japan are some of the leading markets in the Asia Pacific, responsible for triggering the market growth in this region. China is one of the biggest markets for luxury leather products. As per a survey, a lot of Chinese people who travel to overseas countries save on food and hotels but spend on purchasing luxury products. Moreover, the luxury consumers of China are younger than the world average, thereby making it one of the largest markets for luxury leather products in the world.
Some of the key players in this market are Georgia Armani, Burberry, Prada, and Dolce & Gabbana. The manufacturers of such products are mainly concentrated in Europe and North America. High entry barriers, since most of the consumers are loyal to certain brands, increase the difficulty for the small players to enter this market.
Due to the increasing ban on animal slaughtering, the supply of raw materials is very limited, thereby leading to an increase in the input cost and reduction in the profit margin of various companies. With a relatively concentrated competitive landscape, new product launches are key in order to retain the interest of consumers. As a result, the key players continued to introduce various new products at the end of the review period. For instance, Hidesign has launched two products called Champagne and Caviar, which are made from ostrich leather and deer leather respectively.
Attribute |
Details |
Base year for estimation |
2018 |
Actual estimates/Historical data |
2015 - 2017 |
Forecast period |
2019 - 2025 |
Market representation |
Revenue in USD Billion & CAGR from 2019 to 2025 |
Regional scope |
North America, Europe, Asia Pacific, Central & South America, and Middle East & Africa |
Report coverage |
Revenue forecast, company share, competitive landscape, growth factors and trends |
Country scope |
U.S., U.K., Germany, China, Japan, Colombia, and Turkey |
15% free customization scope (equivalent to 5 analyst working days) |
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This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2015 to 2025. For the purpose of this study, Grand View Research has segmented the global luxury leather goods market report on the basis of product, distribution channel, and region:
Product Outlook (Revenue, USD Billion, 2015 - 2025)
Footwear
Bags
Accessories
Others
Distribution Channel Outlook (Revenue, USD Billion, 2015 - 2025)
Offline Retail
Online Retail
Regional Outlook (Revenue, USD Billion, 2015 - 2025)
North America
The U.S.
Europe
U.K.
Germany
Asia Pacific
China
Japan
Central & South America
Colombia
Middle East & Africa
Turkey
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The clothing, footwear, & accessories industry is anticipated to witness checkered growth throughout 2020, as a result of the unprecedented supply chain disruptions caused by the COVID-19 outbreak worldwide. The expected decline in the global sales of clothing, footwear, & accessories is attributable to massive supply chain disruptions across significant export markets, including China and India. However, the industry is likely to recover over the forecast timeframe, given the rising popularity of online/e-commerce sales. From a manufacturing standpoint, the sustainable or ethical fashion trend is expected to favor market growth throughout the forecast timeframe. Luxury apparel is another lucrative space for prospective manufacturers to target, given the mushrooming number of affluent and fashion-conscious consumers across the globe. Our team is diligently working towards accounting these factors in our report with the aim of providing you with the up-to-date, actionable market information and projections.
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