How is the luxury sector attempting to regain its exclusivity?

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The Luxury Sector's Strategy for Regaining Exclusivity

The luxury sector is currently pursuing a dual strategy to recover its market position and re-establish exclusivity by focusing on a return to core principles of quality and craftsmanship, while simultaneously innovating new methods to engage with its clientele. This approach aims to counteract the negative impacts of market saturation, price inflation without commensurate quality improvements, and a significant loss of customers over recent years. The industry is observing a notable shift in consumer desire towards experiential offerings, moving beyond traditional product-centric purchases.
Emphasis on Core Quality and Craftsmanship

A fundamental element of the luxury sector's recovery strategy involves a renewed emphasis on the intrinsic quality and artisanal craftsmanship that historically defined high-end goods. This "back-to-basics" approach, as exemplified by Kering's new CEO's directive for Gucci, prioritizes upgrading product quality and restoring desirability. The goal is to ensure that brands are instantly recognizable through their inherent excellence rather than through widespread branding, addressing the issue of overexposure that has affected labels like Gucci through excessive streetwear collaborations. This focus aims to rebuild trust and perceived value among consumers who have become more discerning about quality, especially after experiencing price increases of up to 50 percent without corresponding improvements.
Cultivating New Client Engagement Through Experiences

Beyond product enhancement, the luxury industry is actively seeking novel ways to connect with clients by tapping into the growing demand for experiences and the wellness trend. This involves offering customer service that rivals the standards of luxury hotels, creating a more immersive and personalized brand interaction. The shift in consumer desire towards "experiences" encompasses areas such as beauty, hospitality, and "transformative luxury," suggesting a move away from purely material possessions towards services and activities that offer deeper personal fulfillment. This strategic pivot aims to create new avenues for engagement and loyalty in a market that has seen a significant decline in its client base, with the market having lost 20 million clients between 2024 and 2025, following a prior loss of 50 million.
Addressing Market Saturation and Client Attrition

The current challenges faced by the luxury market, including a slowing Chinese market and aspirational customers becoming more cost-conscious, have led to significant client attrition. The market lost 20 million clients between 2024 and 2025, adding to the 50 million lost in the preceding two years. This situation has prompted a phase of consolidation, with major groups re-evaluating and pruning their portfolios to bring greater coherence. For instance, LVMH sold off Marc Jacobs, and Kering divested its beauty division. This consolidation aims to streamline operations and refocus on core brands and strategic objectives, thereby indirectly supporting the recovery of exclusivity by concentrating resources and attention on key assets.

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How is the luxury sector attempting to regain its exclusivity?

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