Over the past two years, the luxury industry’s customer base has contracted by approximately 50 million consumers, shrinking from 400 million to around 350 million by the end of 2024. Younger shoppers, particularly Generation Z, show declining brand advocacy and question whether premium pricing aligns with product quality.

According to Bain & Company’s Luxury in Transition: Securing Future Growth report, the global luxury market contracted slightly in 2024, with overall spending declining 1–3% to €1.48 trillion. The personal luxury goods segment—spanning apparel, watches, and leather goods—saw its first real-term slowdown in 15 years (excluding the pandemic), dropping 2% to €363 billion. This recalibration reflects macroeconomic pressures, shifting consumer priorities, and a stark divide between thriving and stagnating regional markets.

Key Drivers of the Slowdown

1. Price Sensitivity: Over 80% of past luxury growth relied on price hikes, but aspirational consumers now resist further increases. Bain notes that 50 million customers exited the luxury market from 2022–2024, with 40% of shoppers criticizing brands as “overpriced”.
2. China’s Decline: Mainland China’s luxury spending plummeted 20–22% in 2024 due to weakened consumer confidence and a resurgence in overseas tourism. Only 5% of brands saw growth there, as shoppers favored understated designs and secondhand platforms.
3. Experiential Shift: Luxury experiences (travel, dining, wellness) grew 5%, outpacing goods. The hospitality sector surged 4% to €242 billion, fueled by high-net-worth demand for exclusive itineraries and wellness tourism.