Changing Trends in the Luxury Packaging Market
The luxury packaging market is worth $15.298 billion for the year 2019 and is expected to grow at 4.09% CAGR to reach a market volume of US$20.258 billion by 2026.
The luxury packaging market has gained significant prominence in recent years owing to the growing need for greater quality packaging options. Luxury packaging refers to the design, development, display, and manufacturing of packaging solutions for luxury brands. Luxury brands are investing heavily in stimulating the interest of younger segments of the population. Luxury brands use packaging solutions to market their products to high net value customers. These packaging solutions are subject to the highest standards of detail and design which aim to maintain the prestige and quality of the product. The vendors are focusing on investing heavily in innovative concepts to stimulate a positive response from the consumers in the market.
The luxury packaging market is segmented by material as glass, paperboard, glass, textile and plastic. The market is further segmented by use as products used in end-user industries such as cosmetics, Tobacco, fragrances, watches, Jewelry and premium beverages. The market can also be segmented based on gender, price and consumer segments.
Major packaging manufacturers are thriving on high-quality materials and various innovative methods to provide enhanced customer experience. Additionally, major market players are focusing on using the development of sustainable packaging solutions, apart from focusing on the intuitive appeal of the product. While small-scale suppliers are distinguishing their product line based on engineered support and packaging solutions to their target customers.
Notable players in the market are Crown, Classypac, Curtis packaging, Luxpac, Mclaren, Berry M&H, Delta global source, Westrock Group among others.
The Surge in the Use of Luxury Packaging Solutions:-
The luxury packaging market has been an integral part of Tobacco, Jewellery, premium beverages, watches, cosmetics and fragrances and confectionary market segments. The cosmetics and Fragrance market segment hold a significant market share in the luxury packaging market and is expected to grow at a notable rate over the forecasted period owing to increased spending by the younger generation on grooming and growing demand for natural deodorants and perfumes. However, the watches and jewelry segment are expected to witness the fastest market growth owing to a rise in disposable income and growing demand for these products in emerging markets. Whereas, the Alcoholic market holds a reasonable market share owing to the growing consumption of wine and beer.
Key Market Drivers In The Luxury Packaging Market:-
Growth in the luxury packaging market is fueled majorly by the growing demand for aesthetically appealing packaging solutions by consumers as it perceived to add superior value to the product. Marketing is an integral part of any product segment and through packaging, the brands aim to provide customers with the desired high-end appeal. Besides, Packaging serves as a silent marketer for products while ensuring continuity in brand messaging to foster growth in the market.
The luxury packaging market has witnessed an exponential rise owing to rising disposable income, urbanization and adoption of western culture in emerging economies such as Australia, India, China and Brazil. Further, growing environmental awareness among the consumers has propelled the manufactures to adopt more sustainable, biodegradable eco-friendly packaging solutions.
The onset of digital evolution globally has been a vital factor in the growth of the luxury packaging market. The digital mediums have allowed companies to expand their production and distribution lines globally, resulting in a spurred demand for luxury goods. Besides, innovation in the plastic packaging industry from end consumer has augmented demand for luxury plastic packaging solutions
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Key market players around the world have adopted various business strategies to sustain, grow in the luxury packaging market.
Companies in the luxury packaging market have adopted collaborative approaches such as are partnerships, acquisitions, mergers and other related commercial agreements which have supported conglomerates to provide superior quality solutions to their customers globally.
The luxury packaging market can be segmented by region into Europe, North America, Asia and Pacific and the Middle East and Africa. Europe has dominated the luxury packaging market owing to the presence of flagship stores and increase demand for online product distribution. Being home to major luxury manufactures and rising tourism in these regions has fueled the demand for luxury products. Markets like Germany, France and Italy are considered to be a hotspot for luxury brands, thus catering to a major share of packaging solutions in the region. Whereas, the Asia Pacific region is expected to grow at the fastest over the projected period owing to a rise in disposable income, increasing employment levels and dynamism in the market-leading to a shift in consumer preference towards luxury products. The North American region has endured continued growth in the market even as spending has risen faster than income in the region.
With more consumers demanding luxurious products and rise in penetration of online channel of distribution and innovative packaging solutions is collective going to boost growth in the market.
Emerging Trends and Opportunities
The emergence of e-commerce and penetration on the internet has opened several opportunities for manufacturers in the luxury product market. In the age of fast-changing opportunities, luxury companies have been keeping a tab on new emerging technological advancements and consumer classes. Besides, companies have been investing heavily in the digital market spectrum to digitally market their products globally and engage with the younger potential customers. The consumer market has become an integral focus of business for these companies; hence the companies are adopting an Omni-personal approach to provide increased personalization to their customers. Companies are heavily relying upon digital technologies such as AI, Big data to enhance and improve customer engagement. These factors have augmented an increase in sales and the need for innovative, personalized packaging solutions.
Besides, the companies have adopted various green packaging initiatives through the use of paper, cardboard-based recyclable packaging solutions.
