Brazilians should spend US$ 13.1 billion in luxury items
DCI
Meeting the new middle classes, in Brazil and other emerging countries: That seems to be the path for the luxury industry to grow. This year the sector intends to sell nearly R$ 20.94 billion (US$ 13.1 billion). In 2010, the Brazilians spent R$ 15.73 billion (US$ 9 billion) on luxury products.
The global terms the sector generated nearly US$ 600 billion in 2010, and the Brazilian share represents nearly 2% of the total. The fact, however, is that without turning to the different social layers the activity will not be able to grow more around here: only 0.6% of the Brazilian population has an income above R$ 20 thousand/month (US$ 12.5 thousand/month) (nearly 307 thousand families). The consumption potential of those people amount to R$ 71.3 billion (US$ 44.6 billion). On the other hand, half of the Brazilians are in class C. Together, they have purchase capacity 13 times greater than that of the elite: it is expected that R$ 923.5 billion (US$ 577.2 billion) be sold this year. If the luxury economy intends to grow, it is at that class it should target.
The data are from studies of the Boston Consulting Group, of the Data Popular and other research institutes that have dedicated themselves to the matter. Last week ended in São Paulo the 3rd Edition of the Atualuxo, the largest local event of the sector. Companies and consultants seem to agree: the mass of consumers in the country has made an effort to get included in the luxury market. In return, it would be healthy if the sector made an effort to include it as well. The luxury economy in Brazil is focused mainly on fashion, hospitality, and in the airline sector. Aside from that, there are good products in real estate, jewelry, cosmetics and food areas.
The consolidation of the C class in Brazil brings the perspective of new consumers to all markets, including this one. However, it will only happen if the values of those people are taken into account, as well as their consumption capacity. The sale of luxury goods in several installments, for example, is already being tried. Everything depends, however, on the continuance of the good economic time of the country.
"Brazil will continue to receive international investments in different areas of luxury, such as tourism, cosmetics, fashion and jewelry (especially branded watches) if continues offering economic and political stability to the players", said Abelardo Marcondes, Executive of the communication agency Lovebrand/TTPM specialized in the sector. "Such movement is due, in particular, to the expectations of continuous creation of wealth by the country, leveraged by events like the FIFA World Cup and the Olympics".