Are luxury brands waking up in 2025? The untapped potential of older consumers — a demographic that has long been sidelined in favor of trend-conscious younger shoppers? Will this be a major trend for retailers this year?
People over 50 now control most of the world’s wealthpresents a stable and valuable market for luxury goods. This group is Defined by strong brand loyalty, a focus on quality over price, and a deep appreciation for tradition and craftsmanship. — Values that align with the essence of a luxury brand.
missed opportunity
“This is a long-missed opportunity for the luxury market.” bellamy grindleprincipal and founder, retail industrysaid in an interview with PYMNTS.
“Older generations not only have more disposable income, but they are also less price sensitive and more brand loyal. They value quality and tradition, which aligns perfectly with what luxury brands offer. We are doing so.
“Many feel the issue is being ignored as media and marketing remains overly focused on young audiences. By prioritizing young people, brands risk alienating that demographic. it is They are keen to invest in their products. ”
What should brands do?
“Luxury brands should focus on authentically engaging older consumers in a way that feels authentic and values their purchasing power,” Grindle said. “This includes refining our messaging, expanding our channels to meet customers where they are, and celebrating tradition and craftsmanship to build deeper emotional connections.”
According to Pimunto intelligence Report, “Why one third of high earners live paycheck to paycheckThe study surveyed more than 4,200 U.S. consumers across a variety of income groups to find out how they spend their money. The highest earners (particularly those earning more than $200,000 a year) typically spend a large portion of their income on luxury goods and experiences. On average, they allocate 9.3% of their income to recreation, leisure, and entertainment, and 8.5% to clothing, accessories, and personal care.
By expanding the scope to include the elderly,Luxury brands can leverage this significant purchasing power while reducing the financial uncertainty associated with volatility. customs duty market volatility andaccording to Sudip MazumderDigital Consulting Company, SVP, Retail Industry Leader, North America Publicis Sapient.
Challenges of relying on young people
“Luxury brands face the challenge of relying solely on youth trends, especially given the possibility of new tariffs that will increase production costs and drive higher prices,” Mazumdar told PYMNTS. .
“Younger consumers are often more price-sensitive and their tastes can change rapidly, so it is risky for brands to focus solely on appealing to them.On the other hand, older consumers, especially Consumers over 50 account for a significant portion of the world’s wealth and tend to value quality, brand loyalty and lasting value in luxury goods.
“A multi-generational approach allows brands to address the following needs: both Catering to trend-conscious younger consumers and wealth-conscious older buyers, we offer stability and resiliency through a diverse customer base. This strategy addresses pressing economic challenges and future-proofing brands by embracing digital channels and personalized experiences to address evolving preferences across age groups. ”
Luxury brands are recognizing the value of a balanced approach that appeals to both ends of the consumer spectrum. Zachary Robichaud Lecturer, Faculty of Retail Management Ted Rogers School of Management, Toronto Metropolitan University.
“Luxury brands targeting older consumers will be a key trend in 2025, driven by changing demographics and the purchasing power of this demographic,” Robichaud said in an interview with PYMNTS.
“Older consumers now control the majority of the world’s wealth, making them an essential demographic for retailers seeking sustainable growth.As the population ages, The brand is adapted With a focus on timeless design, quality and personalized experiences, we offer products tailored to the tastes of affluent, older shoppers. This change expands the customer base and creates loyalty within a market segment that prioritizes value and reliability. ”
According to the study, affluent shoppers, especially those with annual incomes of $100,000 or more, have a strong desire for personalized offers. PYMNTS Intelligence Report, “Personalized offers are powerful, but they too often miss the mark” was born in collaboration with. AWS.
According to the report, 89% of consumers with annual incomes of $100,000 or more are interested in receiving personalized offers, compared to 83% of consumers with annual incomes of $50,000 to $100,000 or more. % exceeds. 74% of people with incomes under $50,000 also want personalized offers.
Two more trends to watch
In an interview with PYMNTS, craig laurieSenior Client PartnerrRetail and consumer consulting, korn ferryraised concerns about possible tariffs on U.S. imports.Which Retailers may be forced to adjust shipments, change sourcing, and reduce purchasing volumes, creating uncertainty.
“Retailers continue to focus on reducing costs while improving service,” Lowry explained. “Customers are looking carefully at their operating expenses and looking for savings, and the industry is also rushing to invest in: AI (artificial intelligence). AI will help you to Accelerate decision-making by providing real-time insights to the market, provide We provide products that better meet customer needs. ”
Alongside this, Rowley added: e-commerce and omnichannel Operations that help consumers find the products they need, support purchasing decisions, and reduce e-commerce operating costs. Retailers are working hard to understand customer segmentation. boomer generation I am retired and millennial generation I’m buying There are more retail businesses than other segments. ”
