Younger Generation Favors Luxury GoodsWith the rapid rise in spending power of the younger generation of consumers, the Brazilian luxury market is seeing a spring in its step.
A recent study was conducted on the Brazilian luxury market, which categorized the luxury market into nine categories: fashion and personal items, real estate, automotive, healthcare, private jets, yachts, fine art, hotels and premium beverages.
The survey shows that the Brazilian luxury market has grown at a rapid rate of 18% over the past five years, generating R$74 billion in revenue in 2022 alone. It is expected to grow by 6% to 8% per year in the following years, doubling its revenue to R$133 billion by 2030.
Among them is the growing contribution of young Brazilian consumers to the luxury market. The study found that while 75% of Brazil’s very high incomes are held in the over-50 group, the 35-and-under group accounts for 49% of spending. Generation Z, in particular, will account for 40% of luxury market spending by 2035, driven by Gen Z spending.
As for the reasons why Gen Z is keen to buy luxury goods, McKinsey partner Pedro Fernandes summarizes them into three trends: loyalty programs with personalization and exclusivity, omni-channel connectivity, and a focus on building brands with their own identities through events and the use of social networks.
Of course, the luxury market still has a foundation to build on, and a return to the top of the market is still possible, especially with the strong demand from younger consumers.