The World's Most Sought-After Luxury Brands
Purchasing power has never been exercised by up and coming generations.
As tastemakers of today, traditional business models continue to be challenged worldwide–including the luxury fashion industry.
The days of such brands being able to rely on history to drive growth are gone. Now, if they are not consciously and consistently working to improve online engagement and appeal to a young and tech-savvy demographic, their sales will suffer.
The ForwardPMX Luxury Study revealed the world's top five most sought-after luxury fashion brands in its tenth edition:
- Louis Vuitton
- Michael Kors
The study states that by 2025, nearly all consumer sales in the U.S. will be affected by online interactions-whether digital or in-store payments exist.
Core luxury brand search volume is up 10% YoY, reflecting the growing interest in the aspiring market, whereas visits to specific company websites are rising 6% YoY, resulting in a maximum of 198.8 million hits.
Gen Y and Z are the future... and the current Millennial consumers are already accounting for the largest proportion of luxury fashion brand site visits, while Gen Z adults are the most over-represented age bracket among luxury brand site visitors compared to their population share.
Generations Y and Z will account for a staggering 130 percent growth in the luxury market by 2025, according to ForwardPMX.
"In this emerging environment of luxury, quality no longer depends solely on history, with digital technology dramatically leveling the field and paving the way for customers to find and understand the products that best suit their preferences and lifestyles," the study states.
"In the process of transformation, luxury brands must continue to change and find the right changes to boost their growth." The report notes four streetwear-friendly labels challenging conventions to boost their online market share: Off-White, Balenciaga, Brunello Cucinelli and Rihanna's Fenty LVMH label.
It also highlights the importance of luxury market change–from mergers and acquisitions to new partnerships and fresh talent.
"Although established companies may have been on the defensive in the past, many are now coming out with more risk-taking, more aggressive creativity, and maybe more desire to self-disrupt and pursue opportunities to help redefine brand identity," he says.
Another trend among consumers of luxury fashion is resale sites. Resale accounts for 7% of personal luxury purchases and is rising at 12% annually, which indicates that affordability is also driving growth.
Although average site traffic and luxury brand search size are both growing, these resale platforms and marketplaces pose obstacles to luxury brands that will need to rely on enhanced customer loyalty and profitability if they want to contend with each other.