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The global handbag market size was USD 47.57 billion 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 6.7% in the 2021-2028 period. 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 analysis, the global market exhibited a huge decline of -25.6% in 2020. 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, material quality, and elegant design. 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%, reaching 1.4 billion.
COVID-19 Pandemic to Result in Rising Prices and Decreased Production
The outbreak of the coronavirus has resulted in shrinking of the consumer's consumption 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 upto 9 percent to make up for the 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, is 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 product ion of hand-bags that provide innovative features, such as removable flap, power unit, outer shell, and others, is thus acting as an opportunity for the industry 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 these bags, which are cruelty-free and are specifically designed for vegans has had a positive impact on purchase patterns. As per the data published by the Vegconomist in March 2021, mentions that Lug had launched its first PETA approved leather products which include handbag .
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 the product as it helps to escalate their purchasing power. For example, according to the data released by the International Labor Organisation, 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 the data published by Catalyst.Org, the 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 luxury goods/products such as handbags, is aiding the market progress. 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, results in the production of a wide range of attractive hand-bags, is in turn, assist 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 employed 300 million people around the world. Furthermore, promotional campaigns done by famous personalities through endorsements and advertisements help to attract more consumers is navigating a path for the growing demand. For instance, according to National News (UAE), in July 2018, Chanel announced the selection of Penelope Cruz as its brand ambassador.
Substitute Products' Strong Market Presence to Hamper Industry 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 handbag market growth. Similarly, a large number of men preferring these substitute products over the handbag has also had a negative impact on the market. In addition, leather products, including these type of bags are witnessing a decline in export in some countries around the world and has 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 Owing to its Ease of Use
On the basis of product type, the market is fragmented into tote, clutch, satchel, and others (hobo, bodycross, saddle).
The tote segment is projected to dominate the market owing to the product possessing a larger size as compared to other types of hand-bags. Its versatility and convenience to carry more items while still retaining their aesthetic looks is likely to boost its adoption. 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 the products' suitability for various occasions and purposes, including casual, formal, and semi-formal settings.
Leather’s Dependability Assist in Holding 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's attractive qualities, such as being naturally waterproof, durabile, timeless, and flexible. This factor is thus anticipated to boost the massive utilization of leather in the making multiple products including handbag. 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 impaction to the market as this material type is preferred for different applications and weather conditions.
Women’s Surging Utilization of E-commerce to Help 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 of women in e-commerce shopping. For instance, according to the International Journal of Recent Technology and Engineering data, women's online 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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Europe is dominating the handbag market share, boasting a size of USD 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 these type of 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, possess a robust presence and continuously gaining traction among local consumers, has had a positive influence on the regional market growth.
Asia Pacific is expected to make steady gains in the global market because of the spike in employment rate, which leads to the rising consumption of consumer goods. For instance, according to the International Labour Organisation, in 2019, the employment-population ratio of Asia Pacific was 33.1% which is a decline from 33.4% of its prior year. Furthermore, the inclination of a large number of young population towards fashion products 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.
North America is expected to display substantial growth, owing to the thriving growth of small businesses. This factor is playing a vital role for increasing the consumption of purses 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, also assist in accelerating the consumption of the product.
South America is estimated to exhibit considerable growth owing to the growing number of people moving into urban areas. Thus, this helps them to received more exposure to various types of products, and thus led in spiking 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.
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The Middle East & Africa region is assessed to have a considerable presence in the market. The economic growth of various African countries is fostering the demand for these 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 in flow of different countries comprises of 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 (IoT) technology. 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 which 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 research report provides a detailed handbag industry analysis 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)
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.
In 2020, the Europe market value stood at USD 16.14 billion.
Growing at a CAGR of 6.7%, 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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