NEW ERA OF RECKONING & REINVENTION

BRANDS WILL NEED TO LOCALISE THEIR OFFERINGS AND EXPAND RETAIL PRESENCE THOUGHTFULLY; CREATIVITY AND INNOVATION MUST REMAIN CENTRAL TO BRAND STRATEGIES.

- BY CHRISTIAN BLANCKAERT Former executive VP, Hermès

AFTER YEARS of robust growth and a remarkable post-Covid rebound, the global luxury market is entering a period of marked slowdown. Forecasts for 2025-2026 suggest a modest growth rate of just 1-2% globally—a sharp deceleration that will challenge luxury brands to confront a new, more restrained reality. This subdued pace is forcing even the most established names in the industry to reconsider their operating models, governance structures, and overall strategic direction.

For too long, many luxury brands enjoyed a sense of calm—some might even say complacency—buoyed by consistent demand and strong margins. But that tranquillity is proving incompatible with today’s shifting global landscape. Brands that had forgotten the need for caution are now facing harsh realities. Warning signs are emerging from iconic names across Italy, France, the U.S., and the U.K., with several reporting troubling performance figures for 2025.