Luxury has a pricing problem. Products at major luxury brands cost an average of 54 percent more than they did in 2019, according to HSBC. And with luxury sales expected to fall 2 percent this year, down sharply from 11-13 percent growth in 2023 (according to consultancy Bain,) many analysts, executives and clients see steep price increases as a key contributor to the sector’s downturn.
As wage growth and inflation slow, the potential for customers to “grow into” higher prices in 2025 is limited. Rebalancing luxury’s value equation through a mix of more accessible pricing and reinforced craftsmanship and creativity will be key to reigniting demand in the sector.
In this memo to BoF’s Executive Members, learn more about:
- How price increases are impacting luxury demand
- The latest data on how luxury prices evolved in 2024
- The most recent comments on pricing by luxury CEOs, CFOs and analysts
- How Gucci, Burberry and Prada are adapting their approach to pricing strategies
Created for Executive Members, Executive Memo’s dive deep into pivotal industry themes, offering in-depth intelligence to support strategy and decision-making. Become an Executive Member now to read the Memo.
