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Winners and losers in Africa’s pre-owned luxury market revealed
By our News Team | 2023
Demand for Louis Vuitton and Chanel has declined, study finds. But Balenciaga is on the rise, despite being embroiled in controversy.
The pre-owned luxury market in Africa enjoyed increased growth last year, fuelled by the rise in so-called ‘revenge spending’ in the post-pandemic era.
With 2023 unfolding as a year defined by economic challenges, socio-cultural shifts, higher inflation and weakening currencies, the ‘State of the Luxury Market in Africa Report 2023’ takes a closer look at whether this demand surge has maintained its momentum, outstripping supply, or if it has begun to taper off as consumers adapt to the evolving economic landscape.
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Sharing insights from the sixth edition of the report released by Luxity, the company’s co-founder and CEO, Michael Zahariev, notes that luxury stalwarts, Louis Vuitton and Chanel, experienced a slight decline in resale values.
“This may signify a challenge in keeping up with the rapid price increases these brands have imposed,” he explains.
Zahariev adds that, in contrast, the Paris-based Balenciaga luxury brand has demonstrated significant growth in resale value, despite global controversy around a 2022 ad campaign that led to allegations it condoned child exploitation.
“Our data reveals that the 2023 luxury landscape is characterised by a nuanced trajectory, with some brands consolidating, others retracting, and new trends emerging. Overall, the resale value of luxury brands seems to be converging between a band of 60% and 70% of retail,” he says.
Analysis of watch and jewellery categories
“This year we also included an analysis of watch and jewellery categories and brands in the report.
“Rolex and Cartier proved dominant in this segment, boasting impressive resale values of 97.6% and 74.6%, respectively. Meanwhile, Tag Heuer presented an enlightening contrast with a resale value of 58.8%.
This stark difference underscores how, in the luxury sector, a brand’s resale power is influenced not only by its category, such as watches, but also by its intrinsic brand value.”
He points out that in the realm of brand awareness and desirability, search interest is a critical metric.
“Louis Vuitton and Gucci maintained their positions as the crown jewels of search interest, commanding 16,88% and 14,14%, respectively. Together, they accounted for approximately one in three searches, slightly down from the previous year’s 32.3%.
“These brands not only dominate search curiosity, but also lead in both purchases and sales, reaffirming their robust digital presence.”
You can download the full ‘State of the Luxury Market in Africa Report 2023’ report here.
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