The global luxury goods market reached $354.81 billion in revenues in 2023, up 13.5% from $312.63 billion in 2022, according to a new report from RetailX. The research provides insights into how influencer marketing and social media contributed to this growth, particularly among younger consumers in emerging markets.

A demographic takeaway is that millennials and Gen Z shoppers account for 47.2% of global luxury store shoppers. Millennials aged 27-42 comprise the largest single group, at 25.1%, while the younger Gen Z buyers under 27 make up 21.1% of luxury buyers.

“Luxury is becoming increasingly linked to sustainability and re-use, driven by younger shoppers getting on board. The shift among a wider consumer base towards luxury is in part prompted by certain demographic groups looking at a more sustainable approach to consumerism, particularly in fashion,” RetailX states.

Regionally, luxury has exploded in emerging markets like China, India, and the Middle East. The data shows that 40.8% of luxury store visits came from shoppers in China, 41.8% from Egypt, and 31% from India. In contrast, the U.S. and U.K. accounted for just 15% and 13% respectively.

Much of this growth in developing regions is being driven by the rise of the affordable luxury segment, which appeals to younger, upwardly mobile middle-class shoppers. Many of these shoppers discover and are influenced to purchase luxury goods through social media.

The report states that 61% of online luxury shoppers globally use mobile devices. In Asia specifically, mobile accounts for 76% of online luxury sales as younger millennial and Gen Z audiences are “mobile-first” and heavily influenced by social media marketing.

China’s luxury shoppers, in particular, exhibit deep links between social media influence and high-end and affordable luxury goods purchases. The data shows that Chinese consumers account for 40.3% of global shoppers who expect to increase their luxury spending in the coming year.

Similarly, 45.4% of shoppers in India predict an increase in their luxury spending, likely influenced by brands promoting affordable segments and unique lifestyle experiences through content creators popular with millennial and Gen Z audiences.

In contrast, more established luxury markets like the U.S. and U.K. show signs of spending declines due to economic pressures, with 41.3% of British and 27.9% of American shoppers expecting to reduce luxury purchases. However, the report notes that around a third of shoppers across income levels globally plan to maintain current spending, offsetting some of the retrenchments in Western markets.

While luxury brands have embraced digital marketing and online channels, the report emphasizes that 86% of global luxury sales still occurred in brick-and-mortar stores in 2023, only slightly lower than 89% in 2019 before the pandemic disruption. This highlights the continued importance of an immersive in-store experience for luxury shoppers.

The full report is available here.