Luxury Goods in Indonesia

Luxury goods in 2025: The big picture

In 2025, luxury goods in Indonesia exhibited dynamic retail current value growth, with this trend shaped by ongoing economic fluctuations and evolving consumer behaviour. Despite the challenges posed by global economic uncertainties, including inflationary pressures and currency volatility, which tempered discretionary spending among certain affluent consumers, continued expansion in the number of high net worth individuals (HNWI) and ultra-high net worth individuals (UHNWI) offset these headwinds. Furthermore, moderate improvements in disposable income and stable employment rates supported domestic consumption, helping to maintain overall market stability. In addition, the continued rise in the number of inbound arrivals, especially wealthier tourists, also contributed to growth.

2025 key trends

Luxury goods in Indonesia in 2025 was characterised by several key trends that significantly influenced consumer behaviour and strategies. Sustainability remained a pivotal factor, as an increasing number of brands and retailers incorporated eco-friendly practices into the production and distribution of luxury goods. This emphasis on sustainability was particularly pronounced within luxury fashion, where consumers exhibited a growing preference for ethically manufactured and slow-produced items, which integrate sustainable materials, waste reduction, and local craft to create "forever" pieces. The primary target audience for luxury goods in Indonesia during 2025 was predominantly comprised of Millennials and Generation Z, who demonstrated heightened engagement with digital and social media platforms. These younger consumer groups displayed aspirational shopping behaviours, often seeking a balance between luxury goods and luxury experiences that emphasised personal expression and social status. While Millennials remained the core purchasers of traditional luxury products, Generation Z increasingly influenced market dynamics through their preference for sustainable and personalised luxury offerings, including experiential luxury.

Competitive landscape

In 2024, luxury goods in Indonesia was dominated by premium and luxury cars, driven by this category's substantial share of overall sales, and high level of consolidation. Bayerische Motoren Werke, Toyota Motor Corp, and Daimler collectively accounted for over half of value sales, with their BMW, Lexus, and Mercedes-Benz remaining the leading brands. Their success was attributed to their commitment to innovation, and the introduction of electric and hybrid vehicles, aligning with growing environmental awareness among Indonesian luxury consumers.

Retail developments

In 2025, sales of luxury goods in Indonesia remained dominated by offline retail channels, with premium shopping centres and high-end department stores serving as the primary distribution channels. These upscale retail environments, particularly in Jakarta and Bali, offered affluent consumers immersive, multi-sensory shopping experiences that combined exclusive product offerings with high levels of personalised service. Notably, foot traffic to flagship stores and luxury boutiques increased compared to 2024, driven by enhanced in-store experiences that integrated local cultural elements and sophisticated design, aligning with the growing demand for unique and culturally resonant luxury shopping environments. The resurgence in physical retail formats was closely linked to urbanisation and rising disposable incomes among the upper-middle and upper classes, and rising inbound travel, fostering a preference for tangible engagement with luxury brands and products.

What next for luxury goods?

Luxury goods in Indonesia is anticipated to experience steady retail current value growth throughout the 2025-2030 forecast period. This upward trend will be supported by an expected rise in the number of HNWIs, UHNWIs, and affluent adults, as indicated by Euromonitor data. Economic growth, coupled with government initiatives aimed at developing the middle and upper-middle classes, is expected to expand the consumer base with sufficient discretionary spending capacity to purchase luxury goods. Urban hubs like Jakarta and Bali will remain pivotal for luxury consumption, driving value expansion for luxury goods categories including luxury hotels, fine wines/champagne and spirits, and personal luxury.