Johannesburg, South Africa — As the global luxury fashion continues to see a decline, African luxury sector has manage to buck the trend with sustained, resilient demand for luxury goods among consumers on the continent.
Luxity co-founder Michael Zahariev unpacks the findings of their 7th annual State of the Luxury Market in Africa report. Some notable findings include:
- South Africa taking the top spot across the continent’s luxury market, with the highest number of luxury stores and high-end shopping experiences
- The pre-owned luxury segment having manage to maintain its growth trajectory, with local online demand outpacing in-store growth, reflecting shifting dynamics toward digital luxury shopping experiences
- In a market traditionally dominated by international big name brands, local designer brands are beginning to establish themselves as formidable players in the luxury category. Among this includes the resale of Browns, with its value only slightly underperforming market leader, Cartier.
This year, with the Sub-Saharan Africa GDP per capita dipping to US$1,540 (from US$1,680 in 2023), and inflation reaching 15.28%, the African luxury sector has managed to dodge the trend, according to the seventh annual State of the Luxury Market in Africa, report by Luxity, which reveals the continent’s appetite for high-end goods, particularly in South Africa, remains untouched.
Luxity co-founder Michael Zahariev points out that typically, economic pressures like contracted GDP growth and steep inflation levels lead to a decline in luxury spending. He makes note of changing trends in other regions such as China, which previously led the luxury market – as captured in this 2020 Statista report – with demand softening to mid-single-digit growth. As a result, brands including Balenciaga and Versace are offering unprecedented discounts to win back consumers and counter sluggish sales.”
This trend is also seen globally, with luxury goods sales anticipated to slow to between 2% and 4% this year, compared to stronger growth in previous years. “In contrast, however, the report finds that there has been a sustained demand for luxury goods among African consumers,” he adds.
The resilient appetite in South Africa
As highlighted in the report, South Africa leads the continent’s luxury market, with the highest number of luxury stores. High-end shopping experiences continue to thrive, with major malls like Sandton City seeing 19% increased luxury segment turnover this year, up from 12.5% in 2015, according to landlord Liberty Two Degrees (L2D).
Zahariev notes that the second-hand luxury market has also maintained its growth trajectory, thriving both in-store and online. “Local demand has remained strong as we continue to see a rise in market adoption for the luxury pre-owned sector. Overall, we are estimating a 30% increase in growth for the year – far exceeding growth in the new products segment.”
He is optimistic that, with South Africa being home to the wealthiest individuals across the continent — along countries such as Nigeria, Egypt and Namibia – the local luxury market will continue to outperform global trends.
Accessibility drives demand
As Zahariev further points out, another factor influencing the African luxury market has been accessibility, with the report highlighting the strong performance of mid-range watches, which have seen a 28% increase in sales. “This interest in accessible luxury is also sparking growth in the pre-owned market, with consumers looking for high-end options at more affordable price points,” he says.
“Signs of brand fatigue are emerging, with shifting consumer loyalty suggesting a more dynamic market, as people become more open to investing in a broader selection of brands,” he highlights. “This shift is evident, with Hermès rising to number one on the report’s top five brands list, a position previously dominated by Louis Vuitton and Chanel.”
Africans willing to invest in global and local luxury brands
Zahariev adds that resale value is a powerful gauge of a brand’s appeal. “Pre-owned goods that command prices nearing those of new items demonstrate higher investment potential and stronger consumer interest. A pre-owned Rolex, for instance, resells at 104.9% of its retail price, suggesting that consumers on the continent are increasingly willing to pay more for luxury items.”
Additionally, while it’s traditionally global brands that usually dominates luxury spending in Africa, he notes that local brands are beginning to establish themselves, as seen with Browns, which resells at 66% of its retail price – slightly underperforming market leader, Cartier which has a resale value of 74%.
Africa’s luxury market is an attractive opportunity for investors
“While global luxury sales are predicted to remain modest in 2025, Africa’s luxury market tells a different story. New brands will be entering the continent, and retail investments in luxury will continue expanding. The pre-owned market is also expected to grow rapidly, aided by anticipated price adjustments from designers and stronger local currencies like the Rand, which will enable more Africans to participate. All told, this will see the continent’s luxury market share rise, positioning it as an increasingly attractive opportunity for luxury investors,” concludes Zahariev.
Click here to read the full State of the Luxury Market in Africa report.
