South Korea Luxury Goods Market Outlook

According to the report by Expert Market Research (EMR), the South Korea luxury goods market size attained a value of USD 6.69 billion in 2024. Aided by the rising consumer demand for premium products and the increasing influence of global fashion and lifestyle trends, the market is projected to grow at a CAGR of 4.6% between 2025 and 2034 to reach a value of USD 10.02 billion by 2034.

Luxury goods encompass a wide array of high-end products, including fashion apparel, accessories, footwear, watches, jewellery, beauty products, and luxury automobiles. These products are characterised by superior quality, exclusivity, and strong brand equity. South Korea's luxury goods market has become one of the fastest-growing globally, driven by a confluence of economic, cultural, and demographic factors.

Key Market Drivers

The increasing affluence of South Korea’s population is a major driver of the South Korea luxury goods market. As disposable incomes rise and wealth distribution becomes more concentrated in urban areas, consumers are demonstrating a growing appetite for high-end products that signify status and prestige. Moreover, South Korea's robust economy, coupled with a thriving tourism industry, has further bolstered the market for luxury goods.

The country's unique consumer culture, which places significant value on personal appearance and social standing, has amplified the demand for luxury products. South Koreans are among the highest per-capita spenders on luxury items globally, driven by the cultural emphasis on projecting a polished and sophisticated image.

The influence of the Hallyu wave, or the Korean cultural wave, is another critical factor driving the South Korea luxury goods market. The global popularity of K-pop, K-dramas, and Korean influencers has elevated South Korea as a trendsetter in fashion and beauty, encouraging global luxury brands to establish a strong presence in the region.

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Emerging Trends

Several emerging trends are shaping the South Korea luxury goods market:

• Sustainability and Ethical Practices: Consumers are increasingly prioritising brands that adopt sustainable and ethical practices. This shift has prompted luxury brands to invest in eco-friendly materials, ethical sourcing, and transparent supply chains.

• Rise of Experiential Luxury: Beyond products, consumers are seeking unique and immersive experiences associated with luxury brands. This includes exclusive events, personalised services, and bespoke product offerings that enhance the overall brand experience.

• Digital Transformation: The integration of technology into the luxury retail space is revolutionising the shopping experience. From augmented reality (AR) and virtual reality (VR) to AI-powered personalisation, digital tools are enabling brands to connect with consumers in innovative ways.

• Growth of Resale and Circular Economy: The demand for pre-owned luxury goods is on the rise, driven by cost-conscious consumers and those seeking vintage or limited-edition items. The resale market is also aligned with the growing focus on sustainability and waste reduction.

• Korean Designers and Homegrown Brands: While international luxury brands dominate the market, there is a growing interest in Korean designers and homegrown luxury brands. These brands are leveraging their unique cultural identity to compete on the global stage.

South Korea Luxury Goods Market Segmentation

The market can be divided based on product, end use, and distribution channel.

Market Breakup by Product

• Watches and Jewellery
• Leather Goods
• Perfumes and Cosmetics
• Clothing
• Eyewear
• Others

Market Breakup by End of Use

• Women
• Men

Market Breakup by Distribution Channel

• Offline
• Online

Competitive Landscape

The EMR report looks into the market shares, plant turnarounds, capacities, investments, and mergers and acquisitions, among other major developments, of the leading companies operating in the South Korea luxury goods market. Some of the major players explored in the report by Expert Market Research are as follows:

• LVMH Moët Hennessy
• Compagnie Financière Richemont SA
• Kering Group
• The Swatch Group Ltd
• Chanel
• ROLEX SA
• Minjukim
• Guccio Gucci SpA
• Chanel
• Prada SpA
• Others

Challenges in the Market

Despite its growth, the South Korea luxury goods market faces certain challenges. Counterfeit products remain a persistent issue, undermining consumer trust and impacting the sales of genuine luxury brands. The high penetration of fake goods, particularly in online marketplaces, necessitates stringent regulatory measures and brand authentication processes.

Economic fluctuations and geopolitical tensions can also influence consumer spending on luxury goods. While affluent consumers are less affected by economic downturns, the aspirational middle class may reduce discretionary spending during periods of uncertainty.

Sustainability and Ethical Consumerism

Sustainability is becoming an increasingly important factor in the South Korea luxury goods market. Consumers are showing a growing interest in brands that adopt environmentally friendly practices, such as sustainable sourcing, recyclable packaging, and carbon-neutral production.

Luxury brands are responding by integrating sustainability into their business strategies. For instance, brands are launching eco-conscious product lines, committing to ethical labor practices, and adopting transparency in their supply chains.

Additionally, the concept of circular luxury is gaining traction. The rise of luxury resale platforms and rental services reflects changing consumer attitudes towards ownership and waste reduction. These platforms cater to environmentally conscious consumers while offering access to high-end goods at more affordable prices.

Future Prospects

The South Korea luxury goods market is poised for sustained growth, driven by innovation, evolving consumer preferences, and strong cultural influences. Digital transformation, including augmented reality and virtual showrooms, will continue to reshape the luxury shopping experience. Brands that invest in technology and create engaging, personalized experiences are likely to strengthen their foothold in the market.

The focus on inclusivity and diverse product offerings will also be pivotal in capturing a wider consumer base. Catering to various demographics, from affluent older consumers to younger aspirants, will enable brands to expand their reach and build long-term customer loyalty.