Research says luxury British brands should be eyeing overseas market.
Luxury not-for-profit organisation Walpole has announced the results of a study with Ledbury Research into the current UK luxury goods market, forecasting growth in sales of 8.5% in 2012.
Key Findings from the 2012 Walpole study show that the luxury industry’s growth is so far on target to achieve forecasts of £9.1 billion by 2015.
Outside of London, and consistent with last year, Edinburgh and Manchester are closely tied as the next most important luxury hubs in the UK, while British luxury remains popular with international consumers, whether through tourism to the UK or British brands overseas.
In 2012, Walpole says that 72% of British luxury brands will have a presence outside the UK, and brands are looking to expand into fast growing markets such as East Asia and Africa. In terms of British luxury abroad, 37% are already present in China, and a further 27% have made plans to enter the market.
The report did state, however, that despite the interest in the British luxury industry in China, the UK is falling behind its European peers in attracting the Chinese shoppers. The biggest Chinese shopping windows, such as Chinese New Year and Golden Week, have no impact on sales for 71% of the sector.
Nevertheless, the online market is certainly booming for British luxury brands. At present 50% of UK luxury brands enjoy an ever-increasing number of online-only clients, no matter the size of the company.
2012 has also been dubbed an “especially important years for Britain”, and the Olympic Games and Diamonds Jubilee are expected to have a positive impact on British luxury brands.
63% of those partaking in the Walpole study said they felt the Olympics Games will positively impact their sales with 20% of respondents anticipating a double-digit rise in sales as a direct consequence. 58% of UK luxury brands believe that the Diamond Jubilee celebrations will have a positive impact on sales.
In a key finding for British jewellery brands and manufacturers, more than 42% of respondents felt that the UK luxury manufacturing is so important that it should not be “off-shored”.
Guy Salter, deputy chairman of Walpole said: “The third annual Walpole & Ledbury Research UK Luxury Benchmark Study highlights a number of new and interesting trends in the British luxury sector.
"With the Diamond Jubilee and the London Olympics, 2012 puts the UK firmly in the global spotlight at a time when British brands are already enjoying a resurgence of popularity around the world. British luxury brands are optimistic about the impact of these events. The results of the study underline the positive outlook for the future of the British luxury industry as a whole.”
The international market was highlighted by James Lawson, director at Ledbury Research, who described the mood of UK British luxury brands as “upbeat”.
“Despite an uncertain economic picture in the short term, British luxury brands are upbeat about 2012, not only due to planned domestic celebrations, but also because of the brands’ growing international footprint.
“The report shows it’s no longer a case of concentrating on China, but looking across Asia, be it Korea, Vietnam or Indonesia, as well as the Middle East, Latin America and Africa.”
Walpole, which represents the UK luxury industry and leading British Luxury brands including Burberry, Harrods and Jimmy Choo, worked in collaboration with market research firm Ledbury Research for the study. Ledbury Research is a specialist in the luxury sector.
The organisations’ annual study of the UK luxury market focuses on senior luxury executives. It is now in its third year and aims to be the most comprehensive analysis of the UK luxury industry and covers the performance, expectations and issues facing leading luxury brands in the UK and internationally.
Joyn Ayton, former owner of Links of London and present chairman of Bremont and owner of Annoushka is also a Walpole chairman.