Luxury brands have withdrawn into their safe space of exclusivity after examining new opportunities to win customers during covid. The only problem is to win and keep the next generation of buyers who have to get married in order to remain difficult to share with a consumer who wants to share everything online.
These companies have no time to waste. According to a spring update of the Bain & Co sector, the industry loses speed relatively quickly.
The study published on Thursday shows that the value of the sector in 2024 was € 1.5 trillion (1.7 trillion US dollars), although the estimates for the first quarter of 2025 compared to the previous year was a shrinkage of 3%.
Also last year, Personal luxury goods Was one of the categories that marked the most remarkable slowdown and knocked from € 369 billion in 2023 to 364 billion euros in 2024. This marked its first contraction in 15 years – with the remarkable exception of pandemic.
And the gap between winners and losers in the luxury sector also grows, added the authors of the author Claudia d’Arpizio and Federica Levato.
The gap between the 75th percentile and the lower 25. Percentile actors rose by 1.5 times in the first quarter of 2025 compared to a previous year, while the market leaders were further advanced, while the lower 20% to 30% of the sector continued to take a growth reduction.
Part of the problem is that consumers with what Bain & Co describes as “value equation” – basically enough – if it is the experience, social and cultural kudos or processing – from the purchase for the increased price they pay,?
For a “long time” luxury brands, tried to increase their customer base so that they are becoming more integrative, says d’Arpizio Assets. This was reinforced in some categories with “entrance articles such as streetwear, sneakers and even beauty – all categories that could have been for young people, but also reinforced with people with less discretionary editions.
This strategy “over -corrected” it added, whereby brands rely excessively on iconic design or experiences that reduce their pace of innovation and therefore cause consumers to ask themselves When your expenses are really worth.
“Last year we had a big loss of customers – 50 million fewer customers buying luxury products – especially in the younger generation and a great decline in the customer lawyer,” continued D’Arpizio. “What is happening now because the brands are trying to fix it and to reinvent this relationship with these customers without losing their exclusivity.”
Exclusivity in the online age
The provision of exclusivity is a more difficult question if younger consumers, as a social media generation, are known for their tendency to post online.
Gone are the days of the galas without cameras, from designer handbags back -rooms without filming: everything is available on one for you in moments of the end.
“Luxury was always about showing himself,” drove D’Arpizio, the Bain & Co lead for global fashion, the vertical luxury goods. “The previous generation showed prosperity and showed performance in life, now it shows more of her personality Or your ability to choose your aestheticsYour quality of life.
“There is a great need, especially in gene z, for sharing. This sharing means to express your personality … but also the desire for conformity. These are two forces that are contradictory, but in reality are a big driver for luxury consumption, because luxury brandies can deliver this conformity, but then in the luxury brand in luxury brand and the selection of your own style, creating your own style, creating your own style. The creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature, creature.
She continued: “Social media has provided an enormous impulse for luxury consumption, since the potential of sharing with a larger audience has created both more customers and to expand their communication strategies and thus have a broader reach.
“So yes, you want to be exclusive, but you know the power of social media.”
