The Business of Fashion and McKinsey & Company released their latest State of Fashion report on June 30, and its central finding cuts against the prevailing narrative of a luxury market in retreat: ultra-high-net-worth clients have not stopped spending, but they have fundamentally changed what they are spending on and why.
What the report ultimately suggests is not a crisis but a reckoning. Luxury’s next growth phase will be built on depth of relationship rather than breadth of audience, and the brands that navigate this transition best will be those that can deliver craft and expertise at scale without diluting either attribute in the process.
Titled Face to Face With Luxury Clients, the report draws on a survey of more than 2,000 luxury consumers across the United States, Europe, and China. It finds that after a prolonged slowdown, luxury is gradually returning to growth—led by the US and China—but that the recovery is bifurcated between the wealthy and everyone else in ways the industry has not fully accounted for.
For brands, the implications are structural. The report advises against a blanket return to pre-2024 strategies, recommending instead a segment-by-segment approach that recognizes the divergence between the top and bottom of the income pyramid. A single pricing and marketing strategy no longer serves the entire customer base across geographies.
The aspirational consumer, long the engine of luxury’s post-pandemic boom, continues to pull back. The top attribute these high-net-worth clients now associate with luxury is not exclusivity or status signaling but expertise and craftsmanship—a demand that favors heritage houses with coherent design languages over brands that relied on logo-driven visibility.
The report comes at a moment when the luxury industry is grappling with what Bain & Company identified as the loss of 20 million clients between 2024 and 2025. The consolidation around the most valuable customers—and the quiet abandonment of the aspirational tier—is reshaping everything from retail footprint to collection planning to communications strategy across the sector.
