Luxury Consumers Seen Prioritizing Product, AI, Price-value Ratio, and Looking Past Star Creative Directors

The luxury goods sector is entering a period of renewed organic growth, with sales projected to rise between 2% and 5% this year as consumer confidence stabilizes. A new study by Boston Consulting Group and Altagamma indicates that while macroeconomic headwinds persist, shoppers are increasingly prioritizing product craftsmanship and price-value ratios over brand status or creative director changes. This shift suggests a more resilient market where recurring customers and a rebalanced base of aspirational and top-tier consumers will drive long-term value.

The 12th True-Luxury Global Consumer Insights study, which surveyed 10,000 respondents across 11 key markets, suggests the luxury industry is emerging from a period of sluggish performance in a healthier, more focused state. Sales are estimated to achieve a compound organic growth rate of 4% to 7% by 2029, supported by a rebalanced consumer base where recurring shoppers are expected to account for 60% of the market, up from the current 40%. Luca Solca, senior adviser at BCG, emphasized that the sector's survival depends on re-engaging aspirational consumers, noting that major brands cannot sustain revenues exceeding 15 billion euros by relying solely on ultra-high-net-worth individuals.

Consumer appetite is notably rebounding among the middle class in China and the United States, with the latter remaining a primary engine for luxury revenues. The U.S. currently hosts approximately 70% of the world’s high-net-worth and ultra-high-net-worth individuals, driven largely by new wealth generated in the technology and AI sectors. Filippo Bianchi, global head of luxury at BCG, noted that while "old money" cohorts spend consistently across categories, "new money" shoppers are currently favoring durable, high-ticket items like real estate and yachts, followed by hard luxury goods such as watches and jewelry.

The report identifies a significant shift in purchasing drivers, with 70% of global luxury consumers reporting they have walked away from a purchase due to misaligned pricing. This "price rejection" has led half of those shoppers to pivot to different brands or product categories, highlighting the critical importance of the price-to-value ratio. Furthermore, consumers are increasingly prioritizing experiential luxury—including travel, hospitality, and fine dining—which is projected to grow from 20% to 40% of luxury brands' total sales. In contrast, traditional status symbols like logo visibility ranked last among 18 surveyed purchase drivers, as shoppers focus more on self-reward and intrinsic product attributes like heritage and craftsmanship.