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It鈥檚 a luxury that many other import-dependent businesses don鈥檛 have. Its diversified supply chain and its expansion into India and Vietnam took years to develop, giving Apple some resilience in counteracting tariffs and buying them time before inevitable price increases. Businesses entirely reliant on China production might have no choice but to raise prices immediately.

For luxury brands, tapping into the partnership channel presents a unique opportunity to reach new audiences and maximize brand awareness. The pay-for-performance partnership model mitigates risk by allowing luxury brands to work with partners that can curate rich stories all the way down the purchase funnel for an established community.

US consumers' appetite for luxury is beginning to fade: But rapidly recovering demand from Chinese consumers will allow LVMH, Prada, Kering, and others to maintain their strong momentum.

Our take: Gen Z鈥檚 engagement habits portray a generation willing to spend on luxuries like gaming and apparel while also valuing increased financial stability. Our Industry KPI data reveals that there is no one-size-fits-all approach to reaching Gen Z.

Nearly three-quarters of low-income consumers see fast food as a luxury, according to April 2024 data from LendingTree. QSRs like McDonald鈥檚 have rolled out limited-time offers like $1 Egg McMuffins to attract budget-conscious consumers. Use this chart: If tariffs lead to price increases, it will certainly affect consumer spending. Marketers and retailers should prepare for that reality.

Fast casual (46%) and full-service (46%) are also on the chopping block. 71% of US consumers making less than $30,000 a year consider fast food to be a luxury, compared with just 31% of consumers with household incomes over $100,000 a year, according to April 2024 data from LendingTree. What it means: The entire restaurant industry is likely to suffer as tariffs put more pressure on consumer dollars.

Our take: Given the uncertainty surrounding consumer spending, particularly in the luxury arena, it鈥檚 no surprise that retailers are pulling every available lever to attract shoppers and drive spending.

Major retailers like Zara and H&M have responded to the increased interest in secondhand goods by expanding their pre-owned offerings, while Walmart鈥檚 partnership with Rebag has brought luxury resale to a broader audience. More brands are expected to enter the space, as 76% of retail executives without a resale program say they鈥檙e considering or planning one鈥攁 2 percentage-point increase YoY.

Luxury brands are buying up premium real estate: Kering, LVMH, and Prada are spending big to acquire flagship properties on prime retail corridors.

L鈥橭r茅al鈥檚 Aesop purchase is the company鈥檚 biggest yet: The beauty giant is spending $2.53 billion to stake a larger claim to the highly profitable luxury skincare category.

AI-powered brand safety will be a necessity, not a luxury, in making native ads more engaging, relevant, and safe. Marketers should leverage AI-driven brand-safety tools to protect reputation and improve ad targeting efficiency. Go deeper: Want more on native ad benchmarking data?

Testimonials could also bring new marketers into the creator space, said influencer marketing consultant Lindsey Gamble, who used luxury brands as an example. 鈥淢aybe you don't want the short-form video made on a phone and want the high-quality product shot, but then you incorporate a comment from a creator that has a name in the fashion industry,鈥� said Gamble.

As sales growth of luxury goods slows in established markets, brands will expand in emerging regions like the Middle East. There, rising wealth among a young population that鈥檚 bringing their spending home will boost demand.

Department stores battled sluggish traffic and selective spending on luxury fashion. What it means for 2025:. Value-consciousness is paramount across all income levels, with affluent shoppers trading down to mass retailers for certain purchases. Inventory management has improved since the 2022 supply gluts, allowing for better margins despite discounting.

鈥淭here's a big change in the luxury market. The consumers are still there, but they're being more selective about what they buy and when they buy it,鈥� our analyst Sky Canaves said on an episode of the 鈥淏ehind the Numbers: Reimagining Retail鈥� podcast. Expanding into new markets and raising prices isn鈥檛 always an option for luxury brands, but there are other areas of opportunity. Here are three ways luxury brands can fuel discovery, spark engagement, and develop loyalty.

As consumers balance the cost of necessities with the desire to splurge, secondhand luxury is a sweet spot, giving shoppers a way to treat themselves without breaking the bank. The category, which was valued at 鈧�43 billion ($45.21 billion) in 2022, will continue to grow, driven by cost-conscious and sustainability-minded consumers.

57% of US adults have used eBay to purchase secondhand luxury fashion and accessories online in the past year, according to March 2024 data from CivicScience.

Department store websites and apps lead. Respondents to our survey were more likely to have made an online purchase than an offline one at department stores, off-price retailers, and brand-owned stores鈥攖he top three types of retailers for personal luxury goods

Luxury spending in the US is returning to historical norms: Shoppers are increasingly focused on saving money and travel.

While mid-tier retailers like Bed Bath & Beyond and Kohl鈥檚 struggle, discount and luxury retailers are seeing success as some consumers trade down amid inflation while others splurge to treat themselves amid tough times, respectively. But these polar opposites are using the same tools and tactics to attract new customers and retain current ones.

Worldwide personal luxury sales will grow from $415.45 billion in 2023 to $499.59 billion in 2027, but growth is slowing, according to our forecast.

Saks launches retail media network amid slowing sales: The ecommerce retailer is billing its offering as a unique opportunity to connect with luxury shoppers.