Q.3 The Ultimate Decline of Luxury Fahsion Sales
# install.packages(c("tidyverse", "knitr"))
library(tidyverse)
library(ggplot2)
url <- ("https://www.mckinsey.com/~/media/mckinsey/industries/retail/our%20insights/state%20of%20fashion/2025/the-state-of-fashion-2025-v2.pdf")
# q.1 Data from the McKinsey report (projected % change in luxury sales for 2025).
luxury_growth_2025 <- tibble(
Region = c("China", "Europe", "US"),
Growth_Low = c(-3, 1, 2),
Growth_High = c(0, 3, 4)
) %>%
mutate(Average_Growth = (Growth_Low + Growth_High) / 2)
luxury_growth_2025
## # A tibble: 3 × 4
## Region Growth_Low Growth_High Average_Growth
## <chr> <dbl> <dbl> <dbl>
## 1 China -3 0 -1.5
## 2 Europe 1 3 2
## 3 US 2 4 3
ggplot(luxury_growth_2025, aes(x = Region, y = Average_Growth, fill = Region)) +
geom_col() +
geom_text(aes(label = paste0(Average_Growth, "%")), vjust = -0.5, size = 4) +
labs(title = "Projected Luxury Sales Growth in 2025",
y = "Average Growth (%)",
x = NULL) +
theme_minimal() +
scale_fill_brewer(palette = "Set2") +
theme(legend.position = "none")

# q.2 Economic profit (a measure of how much money luxury companies really make) dropped in 2024
profit_data <- tibble(
Year = c("2023", "2024"),
Profit_Change = c(0, -1)
)
profit_data
## # A tibble: 2 × 2
## Year Profit_Change
## <chr> <dbl>
## 1 2023 0
## 2 2024 -1
#q.3 Key numbers from the report that explain why people are buying less luxury
reasons <- tibble(
Reason = c("US shoppers trading down",
"China prefers local brands",
"Negative feelings about luxury in China",
"Chinese tourists spending less in Europe"),
Value = c(64, 35, -18, 59),
Note = c("% of US shoppers", "% point increase", "net sentiment %", "% of 2019 levels")
)
reasons
## # A tibble: 4 × 3
## Reason Value Note
## <chr> <dbl> <chr>
## 1 US shoppers trading down 64 % of US shoppers
## 2 China prefers local brands 35 % point increase
## 3 Negative feelings about luxury in China -18 net sentiment %
## 4 Chinese tourists spending less in Europe 59 % of 2019 levels
# Luxury fashion sales are slowing because:
## China, biggest market, is flat or shrinking
## Profits are falling for many luxury companies
## Shoppers are choosing cheaper alternatives or local brands