Luxury

Strategic Context

The global luxury market , estimated at nearly 360 billion euros for personal goods alone in 2024, is entering a critical phase after two years of strong post-Covid growth.
Most brands are experiencing a significant decline, up to -30% for some.

 

This sector, marked by the domination of international conglomerates (LVMH, Kering, Richemont) and emblematic independent players such as Hermès and Rolex, is distinguished by:

  • the intangible value of its brands , up to 40 billion euros for the most valuable
     
  • its ability to combine heritage, desirability and continuous transformation , while facing a new redistribution of the cards
notebook
terrestrial globe

Current Challenges in the Sector

  • Geographic volatility : China, once the driving force of the sector, is now at a standstill . Japan, India, and the Middle East are taking over with more stable or emerging dynamics.
     
  • New generational situation : those under 40 now represent 40% of luxury customers , with radically different expectations: meaning, transparency, without compromise on quality.
     
  • Hyperpolarization of the luxury market : ultra-privileged customers (2% of consumers) now account for 45% of luxury purchases , accentuating the need for unique, tailor-made, personalized experiences.
     
  • Transforming usage : More than just a channel, digital is now a commercial infrastructure in its own right. It supports both scarcity (NFTs, private exclusives) and democratization (second-hand, circular access).

Structuring Issues

The efforts made by institutional brands in terms of distribution, quality and service have redefined the standards of the luxury sector.
This operational excellence, now integrated as an expectation, is no longer sufficient to respond to the structural tensions that are emerging today.

 

Three major challenges face all stakeholders, even in a context of strong growth:

  • Preserving Brand Equity standards while capturing growth , without slipping into identity dilution
     
  • Reduce strategic dependence on the Chinese market , which has become unpredictable, by rebalancing growth levers towards local cosmetics and watchmaking brands
     
  • Integrate the new frontiers of customer experience , driven by AI, without breaking with in-house relationship codes
fabric

This quest for strategic balance requires nuanced trade-offs between channel diversification, geographic reallocation, uniqueness of offering, strategic brand vision and demand governance.
All luxury players are today faced with this tension between market expansion, customer loyalty and redistribution of growth centers.

Site design and referencing by Simplébo

Connection