The Luxury Product Markets’ Rise and Fall

As it is mostly understood from the general status quo of Türkiye, the country has been going through economically challenging years. Issues like the devaluation of the Turkish lira, economic uncertainties, and local markets’ high volatility have contributed to Türkiye’s high inflation since the early 2010s.

These financial struggles have significantly strained household budgets, with the prices of fundamental needs, such as food, healthcare, and education, rising dramatically in recent years. The low minimum wage remains insufficient to meet these basic necessities.

According to data from Türk-İş in July 2024, the monthly food expenditure of a four-member family was estimated to be around 19,235 Turkish liras to maintain a healthy diet, when the minimum wage stood at 17,002 TL. Despite the increase at the beginning of 2025, the minimum wage is still far below the poverty threshold, which is 62,652 TL.

Contrary to expectations during times of economic hardship, Türkiye’s luxury brand market has experienced notable growth, and the country’s demand for luxury goods remains clear, showcasing resilience.

Türkiye’s luxury sector has also expanded beyond traditional segments such as fashion and jewelry. It now includes high-end cars, real estate, and fine dining—more experiential products, as stated. Although the state of the economic crisis continues, the long queues in front of restaurants and shops are still a reality, and it shocks many.

This growth comes in the face of persistent economic hardships that might typically suppress nonessential spending. However, instead, luxury consumption in Türkiye is being driven by several key factors, including evolving consumer preferences and accelerating exposure to global trends.

Türkiye’s luxury market has reached an estimated value of around 3 billion euros, proving its important position in both the national economy and the global luxury industry. Moreover, luxury sales have been surging globally; according to the reports of Bain & Company, sales rose by 36% in 2021 in China. Also, according to another study by Bain & Co. and Altagamma, the global luxury consumption market exceeded 1.5 trillion euros in 2023, despite geopolitical and economic uncertainties. It is also stated that experiential products are now more preferred than tangible products. This shift is evidenced by the decline in public art auctions, where artworks were sold, once a key indicator of wealth and often used as status representation.

A new consumer demographic, especially younger people, is embracing luxury goods as a status symbol. This demographic change has impacted the market, with millennial and Gen Z consumers contributing significantly to the demand for high-end products, using them as a form of self-expression, either as a fashion statement or a marker of their societal status. The rising brands of today, mostly the brands under LVMH, also focus on these forms of emotional self-expression when designing their products, following the trends of the day and appealing to the feelings of the customer base. As people are seeking new approaches to the already existing trends, some are looking for timeless looks. These all come together to shape the luxury fashion sector we see today.

Türkiye’s geographically strategic location, serving as a bridge between Europe and Asia, is also a key factor in making this country a critical market for luxury products.

As the luxury product and high-end brand market become more prominent, as a result of the high prices, the second-hand sector is also experiencing a rise in its significance in countries’ economies. Also, second-hand products and the concept of “thrifting” are becoming more widely accepted and appreciated by society, particularly among the younger generation.

Despite the economic challenges we faced globally, the rise of luxurious products is undeniable. As a response to this growth, second-hand product applications are also becoming more highlighted, and they are getting more investments.

Besides all of these mentioned elements, the demand for luxury products had to pause for some time, as the production costs have skyrocketed in the last months. A key example of this is the tariffs implemented by the United States in the second Trump administration. These tariffs were impactful to the main production sites of such luxury products, so the increasing trend has become more steady. It is mentioned by Vogue that the new trend is becoming more uncertain in the developments of the markets, as these economic changes do occur frequently.

Still, luxury product firms account for a significant amount of the market share, and they do have a prominent role in the general economy, whether they are counted as a fashion or a statement of economic status or personality.

Edited by: Ömer Gökce