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The global handbag market size was USD 47.57 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with the product witnessing a negative demand shock across all regions amid the pandemic. Based on our handbag industry analysis, the global market will exhibit a huge decline of -25.6% in 2020. The market is projected to grow from USD 49.63 billion in 2021 to USD 78.46 billion in 2028 at a CAGR of 6.8% in the 2021-2028 period. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.
The product is exhibiting a gradual market expansion as people are increasingly enticed by its stylish appeal, quality of materials, and elegant designs. It is popularly used for enriching the looks of the user while also acting as a useful storage unit. The thriving growth of the travel and tourism industry, leading to an upsurge in the need for the product, is likely to fuel the product’s demand. For instance, according to the data released by the United Nations World Tourism Organization, in 2018 international tourist arrivals witnessed a growth of 5 percent, reaching 1.4 billion.
COVID-19 Pandemic to Result in Rising Prices and Decreased Production
The outbreak of the coronavirus has resulted in a shrinking of the consumer's spending on luxuries such as hand-bags, which has forced various brands to hike the price of their products to compensate for their loss. For instance, according to the data issued by the Economic Times, in June 2020, Gucci increased the price of its handbag by up to 9 percent to make up for the handbag product sales decline due to COVID-19. Similarly, its competitors, such as Chanel and Louis Vuitton, are also increasing the prices of the products. In addition, the implementation of social distancing and lockdown across the globe has led to a decrease in the production of these bags, thus hampering the growth of the market.
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Shift towards Innovative Products to Spike Demand
A large number of brands are shifting their focus towards the production of handbags that possess innovative features, such as removable flaps, power units, outer shells, and others, thus acting as an opportunity for market growth. For instance, Evolution Smart Bag came up with the Autumn Blue Signature Handbag that has an evolution power unit, an EVA outer shell, a charging base, an inner bag, and a removable flap. Moreover, the growing production of hand-bags, which are cruelty-free and are specifically designed for vegans has had a positive impact on handbag supplies and purchase patterns. For instance, Immaculate developed the Paname Oxymore Vegan Leather & Microsuede Hand-bag that uses eco-friendly materials and is cruelty-free.
Rising Female Employment Rate to Aid Market Growth
The increasing number of women participating in the global workforce has played a crucial role in intensifying the demand for handbags as it helps to escalate their purchasing power. For example, according to the data released by the International Labor Organization, 48.5 percent of women across the globe were estimated to be participating in the global workforce in 2018. In addition, the high consumer spending contributed by the female population is likely to raise the consumption rate. For instance, according to Catalyst.Org data, global female consumer spending in 2019 was evaluated to be USD 31.8 trillion. Moreover, the increasing female literacy rate worldwide has led to a heightened awareness of the availability of the luxury goods or products such as handbags, which is aiding the market to generate traction. For instance, according to World Bank data, the adult female literacy rate in 2019 stood at 83.024 percent.
Increasing Inclination of the Global Population towards Fashion Products to Fuel the Market
The thriving growth of the fashion industry, resulting in the production of a wide range of attractive hand-bags, is assisting the market to gain more traction globally. For instance, according to the data published by the Business of Fashion Ltd and McKinsey & Company's report on ‘The State of Fashion 2019’, the global fashion industry was valued at USD 1.3 trillion and is projected to employ 300 million people around the world. Furthermore, promotional campaigns done by famous personalities through endorsements and advertisements help to attract more consumers towards these products. For instance, according to National News (UAE), in July 2018, Chanel announced the selection of Penelope Cruz as its brand ambassador.
Substitute Products Holding Strong Presence to Hamper Handbag Market Growth
The substitute products to hand-bags, such as bag-packs, briefcases, drawstring bags, and others, are increasingly gaining presence in the market around the world and are estimated to have a negative impact on the market’s growth. Similarly, a large number of men preferring these substitute products over the hand bag has also had a negative impact on the market. In addition, the leather and leather products, including hand-bags witnessing a decline in export in some countries around the world, have an undesirable influence on the rising consumption. For instance, the data released by Leather India.Org, India has experienced a decrease in leather and leather products export with a reduction from USD 2398.44 million in 2018 to USD 2276.39 in 2019.
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Tote Segment to Remain at the Forefront
On the basis of product type, the market is fragmented into tote, clutch, satchel, and others (hobo, body cross, saddle).
The tote segment is projected to dominate the market owing to the product possessing a larger size as compared to most other types of hand-bags. This factor makes these bags more versatile and convenient to carry a larger number of items while still retaining their aesthetic looks. For instance, Carmen Tote is made up of one zip pocket, two slide pockets, three credit card slots, one adjustable & detachable shoulder strap, and two handles, which makes it highly versatile and convenient for most users.
The clutch, satchel, and others (hobo, body cross, saddle) segments are also strengthening their market presence owing to these products being suitable for various occasions and purposes, including casual, formal, and semi-formal settings.
Leather Segment to Hold Highest Market Share
Based on raw material, the market is segmented into leather and fabric (cotton, wool, silk, polyamide, polyester).
The leather segment is anticipated to hold the major share in the market on account of the product owning various attractive qualities, such as being naturally waterproof, durability, timelessness, flexibility, and others. Hence, this is assisting to escalate the utilization of leather in the making of handbags. For instance, the data published by the Leather Goods & Footwear Manufacturing Association of Bangladesh show that the global leather goods market is assessed to be worth USD 95.4 billion in 2018.
On the other hand, the fabric (cotton, wool, silk, polyamide, and polyester) segment is expected to have a significant impact on the market as this material type is preferred for different applications and weather conditions.
Women Segment to Embrace a Larger Market Share
By end-user, the market is bifurcated into men and women.
The women segment is estimated to lead the market due to the upsurging participation in e-commerce shopping among women. For instance, according to the International Journal of Recent Technology and Engineering data published, women's online shopping spending was assessed to be more than double in 2020.
The men segment is also displaying gradual development as men are increasingly drifting towards the consumption of various fashion goods, including handbags.
Europe Handbag Market Size, 2020 (USD Billion)
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Asia Pacific is expected to make steady gains in the global market. The employment rate of this region is gradually rising, which has had a significant impact on the increasing consumption of consumer goods. For instance, according to the International Labour Organization, in 2019, the employment-population ratio of the Asia Pacific was 33.1. Furthermore, a large number of the young population is more inclined towards fashion products than others is estimated to have a vital contribution to the growth of the market. For instance, according to the data published by the United Nations Economic and Social Affairs, in 2019, Central and Southern Asia possessed the largest youth population in the world, which was evaluated to be around 361 million.
Europe dominated the global market, boasting a size of 16.14 billion in 2020. The high per capita income of various countries of this region has led to a surge in the consumption of fashion products, including hand-bags. For instance, data released by Trading Economics reveal the per capita income of various countries, with Germany at USD 53,815, Italy at USD 42,413, France at USD 46,184, and the United Kingdom at USD 46,699. In addition, domestic brands, such as Louis Vuitton, Chanel, Gucci, and others, possessing a robust presence and continuously gaining traction among local consumers, have had a positive influence on the regional market growth.
North America is expected to display substantial growth, owing to the thriving growth of small businesses playing a vital role in increasing the consumption of hand bags specifically designed for business purposes. For instance, according to the Small Business Administration 2019 data, the United States has 30.7 million small businesses, which have 59.9 million employees. In addition, the availability of multiple types of fashion exhibitions, such as Apparel Sourcing USA, Stylemax Chicago, Micam Americas Las Vegas, and others, is also assisting to accelerate the consumption of the product.
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South America is estimated to exhibit considerable growth owing to the growing number of people moving into urban areas. Thus, they are getting more exposure to various types of hand bag products, which has helped spike the consumption rate of fashion goods. For instance, according to the United Nations Economic and Social Affairs, in 2019, out of 624 million people in Latin America, more than 80 percent live in urban areas.
The Middle East & Africa region is assessed to have a considerable presence in the market. The economic growth of various African countries leading to the fostering of demand for hand-bags is assisting to drive the regional market growth. For instance, according to the United Nations Conference on Trade and Development, African countries experienced economic growth of 10.8 percent in 2018. Thus, the economic value of foreign investment inflow of different countries comprises Egypt USD 6.8 billion, South Africa USD 5.3 billion, Congo USD 4.3 billion, Morocco USD 5.6 billion, and Ethiopia USD 3.3 billion.
Key Players are Drifting towards Incorporating New-age Technologies
The key players of the market are increasingly shifting their focus towards incorporating hand-bags with the internet of things (IoT). This will help enrich the experience of owning the product, as the technology allows to give notification alerts to the user’s smart-phone and also provides a cautionary signal for prevention against loss of smartphones. For instance, Glimm Smart Bag 1.0 uses an IoT technology that has Bluetooth connectivity, and three different shades of jewels that provide crucial notifications from the phone. This bag also comes with the ability to provide warning signs when the smartphone is at a far-off distance.
An Infographic Representation of Handbag Market
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The global market research report provides a detailed analysis of the market and focuses on key aspects, such as leading companies, end-users, and leading product types. Besides this, the report offers insights into the current key market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over recent years.
Value (USD Billion)
By Product Type
By Raw Material
North America (By Product Type, Raw Material, End-User, and by Country)
Europe (By Product Type, Raw Material, End-User, and by Country)
Asia Pacific (By Product Type, Raw Material, End-User, and by Country)
South America (By Product Type, Raw Material, End-User, and by Country)
The Middle East and Africa (By Product Type, Raw Material, End-User, and by Country)
Fortune Business Insights states that the global market size was USD 47.57 billion in 2020 and is projected to reach USD 78.46 billion by 2028.
Growing at a CAGR of 6.8%, the market will exhibit moderate growth in the forecast period (2021-2028).
The tote segment is projected to be the leading segment in this market during the forecast period.
The rising women employment rate across the globe is the major factor driving the growth of the market.
Coach IP Holdings LLC (New York, USA), Louis Vuitton Malletier (Paris, France), Chanel Ltd (Paris, France), and others are a few of the major players in the global market.
Europe dominated the market share in 2020.
An improving sense of fashion among the global population is expected to drive the adoption of this product.
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