“If you were to choose one word to characterize the recent past and the near future of the global luxury goods market, that word would be ‘change,’” Kleinewillinghoefer said in the report. “During the pandemic, a powerful phrase went viral, capturing the market’s hopes for a future that no one was sure would ever arrive: ‘the new normal.’ Underpinning this thinking was the belief that once the pandemic passed, things would be different but would eventually stabilize. The maxim was half right.
With sustainability, regulations and ongoing consumer pressure are pushing brands to prioritize sustainable practices throughout their supply chains. There is also the emergence of technological innovations such as AI, predictive AI and generative AI as well as virtual reality, which are being used to improve everything from product design to customer experiences.
Rising Costs: Inflation and supply chain disruptions are forcing brands to raise prices, potentially alienating some customers.Kleinewillinghoefer concluded by offering three key takeaways for luxury brands to navigate this changing landscape: Innovate or Stagnate: Heritage alone won’t be enough. Brands need to proactively embrace innovation and differentiation.
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