«Maybe is the most beautiful word in the dictionary because it allows you to sail to infinity». The President of Altagamma, Matteo Lunelli, opened with a quotation from Leopardi to start the work at the eleventh edition of Consensus Altagamma, in collaboration with Bain & Co, which took place yesterday morning. And he added: «I have never seen negative double-digit numbers but it is an entrepreneur’s duty to navigate even in uncertainty. The pandemic immediately struck the high-range industry on a worldwide scale and will lead to a 20% fall in turnover in 2020, according to Altagamma Consensus. However, the sector will re-start and the long-term trend is still positive with a growth of 2-3% from now to 2025, as the Monitor Altagamma Bain has estimated. The Italian creative industry, equipped with unique manufacturing, creative and entrepreneurial resources, has the right cards for a re-launch and to return to a position of world leadership. There are, however, several priorities: in the short term, the supply chains in difficulty need to be protected; in the medium period, digital transformation, a tourism re-launch – which is strategic for all sectors – and much greater attention to environmental and social sustainability». Consensus Altagamma offers an overall forecast of personal luxury goods consumption in 2020 with estimates – until 2025 – compiled by an in-depth study by some of the sector’s leading analysts.
Stefania Lazzaroni, General Manager of Altagamma commented: «Consensus Altagamma, with estimates from 22 analysts, foresees a considerable drop in global consumption and a 30% fall in sector company profitability in 2020. A strong positive sign is the performance on retail and wholesale digital channels that show +16% and +12% respectively. Companies’ digital transformation will certainly be strengthened and the crisis will lead to new lifestyles – more sustainable, moderate and aware – whose interpretation will be decisive in re-launching high-range». The personal luxury goods industry will have to tackle disturbing changes and forces in the coming years and it is mainly in the hands of the players within the sector as to how to re-shape it, starting from now. While they react in order to manage the current crisis, brands must decide and plan now how they intend to guide the industry’s transformation, starting from the consumer.
«We expect the luxury market to recover but the sector will be profoundly transformed», said Claudia D’Arpizio, Partner at Bain & Company and author of the study. «The current crisis is forcing this industry to think even more creatively and to innovate even more quickly to meet consumer demand and overcome the restrictions on the channels. The brands that will come out on top will be those that manage to better interpret the zeitgeist while still remaining in line with their own heritage and roots». Further comments came from Federica Levato, Partner at Bain & Company and co-author of the study: «Consumers see a world that has changed deeply, one which luxury brands must necessarily adapt to. Safety in stores will be obligatory and always associated to the magic of the luxury experience: creative ways to attract customers into the store or to take them directly to the products, will make the difference. The speed at which this market grows will depend on brands’ strategic responses to the current crisis and their ability to transform the luxury industry to the benefit of the consumers». Let’s look at the estimates for 2020. For those markets most exposed to the crisis, and with the absence of international tourist flows, especially Chinese tourists, an average drop of 20% is foreseen, distributed as follows: Europe (-29%) and the Americas (-22% for North America and -21%for Latin America). Chinese consumer purchases (-9%, the first to emerge from the crisis), Japanese (-14%) and the rest of Asia (-16.5%) are the expected downturn figures in 2020, even if the impact will be less compared to European (-25%) and North American (-21%) consumer purchases.