Why luxury consumers are choosing experiences as AI, changing values reshape luxury

The global luxury market is entering a phase of stabilization and normalization in 2026, with total spending projected to reach up to EUR 1,470 billion. According to the latest Bain-Altagamma study, the industry is shifting away from traditional ownership toward experiential luxury and AI-driven discovery. This transition reflects a broader cultural reorientation where consumers prioritize meaningful moments and craftsmanship over mere status symbols amidst ongoing macroeconomic volatility.

The global luxury industry is navigating a period of gradual stabilization following a year of macroeconomic disruption and geopolitical tension. Bain & Company, in partnership with Altagamma, reports that worldwide luxury spending reached EUR 1,443 billion in 2025 and is forecast to grow between 0 and 2 percent in 2026 to a range of EUR 1,440 billion to EUR 1,470 billion. Claudia D’Arpizio, a senior partner at Bain, notes that the market is not returning to its old rhythm but is instead emerging into a new one defined by relevance in AI-led ecosystems and a shift toward meaning rather than ownership. While the personal luxury goods segment saw a modest contraction to EUR 358 billion in 2025, it is expected to recover with 2 to 4 percent growth in the coming year.

Geographic performance is diverging sharply, with the United States showing significant momentum as American brands grew between 10 and 15 percent in the first quarter of 2026. This growth is being driven largely by younger consumers under 35 and upper-middle-class households, who are increasing consumption at twice the rate of wealthier segments. Conversely, Europe remains the weakest region due to a 20 percent drop in international tourism spending in early 2026, while the Gulf region saw luxury consumption decline between 15 and 25 percent. China is exhibiting a cautious recovery, particularly in online sales which rose up to 35 percent, as consumers shift their focus from leather goods toward ready-to-wear as a form of self-expression.

A defining trend of 2026 is the preference for experiences, which are growing 1.5 times faster than tangible goods, buoyed by resilience in luxury hospitality, private aviation, and fine dining. Within product categories, jewelry is leading the market while watches are seeing a shift toward connoisseurship and rarity, which has in turn doubled searches for vintage items in the resale market. Furthermore, artificial intelligence is fundamentally altering the purchase journey, with approximately half of luxury consumers using AI for discovery and product comparison. Brands are now pressured to build AI-native relevance to avoid becoming invisible in an increasingly digital and value-driven landscape where nearly two-thirds of consumers rely on technology for product validation.