The Need for Traceability in the Luxury Goods Market

The worldwide luxury goods market is projected to grow from $257.26 billion in 2020 to $352.84 billion by 2027 at a compound annual growth rate (CAGR) of 4.6% in the forecast period. 

Examples of luxury goods may include jewelry, designer handbags, high-end watches or luggage, yachts, haute couture clothing, and expensive wines, among other items.

Gen Z (born between the late 1990s and early 2010s) and millennials (born between the early 1980s and the late 1990s) are the largest drivers of the luxury goods market, per a report by Bain & Co., a management consulting company. Gen Zers purchase luxury items three to five years earlier than millennials. The luxury goods market is forecast to be “recession-proof” in 2023, in part because of millennial and Gen Z consumers, who accounted for the growth of the market in 2022, the report found. 

Gen Z buyers, for whom inclusivity, sustainability, transparency and traceability are not negotiable, already have changed the way brands do business. Millennials and Gen Z accounted for 72% of the global luxury market in 2022 compared with 2019, when millennials and Generation X made up most of the luxury goods market, at 66% of market share, compared with Gen Z’s 8% share.

Full Disclosure in the thriving Luxury Watch Market

The luxury watch market was valued at $43,661.8 million in 2019, and is estimated to reach $51,317.3 million by 2027, registering a CAGR of 4.50% from 2021 to 2027.

In October 2022, Sourcemap, a global provider of supply chain transparency and traceability software, partnered with Swiss watchmaker Breitling to deliver end-to-end traceability for the precious materials used in its newest watch, the Super Chronomat Automatic 38 Origins. By partnering with Sourcemap, Breitling guaranteed its customers sustainably sourced artisanal gold from a single mine and lab-grown Fenix diamonds from an accredited supplier. 

“The bar is rising for companies to provide more visibility into the origins of luxury products and their components, and those who can deliver will stand out from those who don't,” said Leonardo Bonanni, Founder & CEO of Sourcemap. “It takes one company to catalyze others to commit to supply chain transparency, and Breitling is that first-mover in its search for a more sustainable path forward.”

For a luxury goods maker, having a publicly trusted, traceable and transparent supply chain means they can offer their customers a full guarantee of ethical sourcing of materials, sustainable manufacturing processes, and ensure authentic production of goods at the time of purchasing.

For more information about traceability in the luxury goods market, reach out to our team.