Mexico Luxury Goods Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Mexico Luxury Goods Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Mexico luxury goods market is projected to register a CAGR of 6.83 % during the forecast period, 2022-2027.

The country has a sizably high demand for luxury goods. Additionally, Mexico continues to be North America's top destination for luxury travel, making it distinct as a major market for the sale of luxury goods. Further, the development of e-commerce has made it simple to get product-related data and prices at any time through internet sources. This has helped the luxury market in Mexico as a whole continue to expand. Mexico, a nation of 130 million people, is a desirable market due to its economic stability and openness to international trade, as evidenced by the existence of no fewer than 12 free-trade agreements. For businesses looking to grow across the Atlantic, Mexico offers lucrative opportunities for luxury brands to flourish in the region's luxury goods market space.

The fashion and luxury industries have been heavily damaged by the Covid-19 crisis across Mexico. The pandemic had a significant impact on how consumers view their financial circumstances, according to a survey by the Index of Consumer Sentiment (ICS). This has had a particularly negative impact on high-income clients and, as a result, their trust in making discretionary purchases. However, the market has shown substantial recovery since the second quarter of 2021 due to the reopening of cross-border trades and international tourism.

Key Market TrendsIncreasing Preference for E-commerce Platform to Purchase Luxury Goods

The demand for luxury goods has increased in Mexico as a result of consumers' growing preference for online retail stores when buying various accessories. Through e-commerce platforms, people are more likely to buy various luxury goods including shoes, purses, jewelry, watches, and other similar products. Due to the convenience involved, online transactions are more appealing to Gen Z and millennials. According to Mexico's Asociacion Mexicana de Venta Online, in 2020, 29% of consumers between the ages of 36 and 48 and 36% of consumers between the ages of 25 and 34 showed an interest in online purchases. Additionally, the website's ease of access and secure payment methods have given online shopping channels an advantage. The major market players are also working to improve the efficiency and convenience of clients' buying experience by allowing them to virtually try on high-end products before making a transaction.

Tourism Driving the Growth of Luxury Goods Market in Mexico

The continued expansion of the tourism sector is responsible for the luxury goods market's steady growth in Mexico. Wealthy families who visit the nation frequently purchase luxury goods from the local stores of various international brands. Since this category of consumers is heavily influenced by fashion, they make up the bulk of purchasers. Due to Mexico's robust economy, prominent global corporations frequently introduce their luxury items here earlier than in many other nations across the world. Luxury leather goods, luxury portable consumer electronics, luxury watches, and perfumes are items that tourists frequently encounter and are associated with Mexico.

Competitive Landscape

The luxury goods market in Mexico is highly competitive, with both domestic and foreign brands competing for the market share. Key companies are emphasizing new product development, merger, expansion, acquisition, and partnerships to increase their brand awareness among customers. For example, In April 2022, The luxury department store chain El Palacio de Hierro in Mexico announced its intentions to build a new store in the Coyoacán neighborhood of southern Mexico City's Mitikha mixed-use community. Giorgio Armani S.p.A., Kering Group, Louis Vuitton North America, Inc., Rolex SA, Hermès, The Estée Lauder Companies, Patek Philippe SA, The Swatch Group, and Richemont are a few of the major companies in the Malaysia luxury goods market.

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