In light of a challenging global luxury market, Japan stands out as a beacon of opportunity, demonstrating resilience and growth potential. The Q1 ‘24 Luxury Goods market results highlight Japan’s allure for affluent travelers, propelled by factors such as a weak yen. Business is flourishing for both local and international luxury brands. LVMH, with about a quarter of its Asia stores located in Japan, noted double-digit revenue growth in Japan in Q1 ’24. Hermes saw a 25% hike, while Ermenegildo Zegna group’s APAC (Asia-Pacific) revenues grew by nearly 29%, mainly powered by the Japanese market.

Key Points from Statista’s Recent Report on Japan’s Luxury Market:

  • 2024 Revenue Projections: The Luxury Goods market in Japan is projected to generate US$32.31bn.
  • Annual Growth: Expected to grow annually by 4.69% (CAGR 2024-2028).
  • Largest Segment: Prestige Cosmetics & Fragrances, estimated at US$11.17bn in 2024.
  • Global Comparison: The United States leads in revenue generation, with an expected US$77.28bn in 2024.
  • Per Capita Revenue: Projected at US$263.50 in Japan for 2024.
  • Online Sales Contribution: Expected to account for 17.2% of total revenue in the Luxury Goods market by 2024.
  • Market Drivers: Strong cultural appreciation for craftsmanship and attention to detail.

Japan’s department stores are also experiencing unprecedented growth. According to a Savills report, tourists contributed more than half of total sales in several luxury stores in Ginza last year. Isetan Mitsukoshi, which operates one of Japan’s largest department-store networks, noted over 114% year-on-year growth in sales this April. In Japan, luxury boutiques are housed in department stores rather than traditional malls.

As a company deeply immersed in this field, we see significant potential for growth in the Japanese market. Luxury brands can thrive by balancing the needs of tourists and local customers, who continue to shop despite the currency’s devaluation. The future looks bright for Japan’s luxury market, and we are excited to be a part of this journey.