This article is part of The Luxury Slowdown Survival Guide, a collection of articles examining the recent industry downturn and strategies brands can adopt to emerge from it unscathed.
The only time in my life where I didn’t really worry about money was the first few months after lockdown ended. With months of unpaid paychecks piling up, I gave it my all. In addition to clothes, bags, and shoes, I bought furniture, a gym subscription, several business class flights, my first plastic surgery, and a new washing machine. I know I’m not alone. This disruptive behavior has been widely documented, is called “revenge spending,” and is analyzed by psychologists as a way for people to regain control of their lives.
But crashes usually follow highs, so we started feeling the effects of inflation and interest rate inflation about a year ago. We found ourselves accumulating credit card debt. And in this context, we have become extremely sensitive to sharp price increases from luxury brands looking to capitalize on the post-pandemic frenzy. So we stopped buying (as much). And now it’s the industry’s turn to suffer. The global luxury goods market lost approximately 50 million customers in 2024.
It’s no exaggeration to say that the downturn in luxury goods has defined our conversation in 2024. In the second half of this year alone, Vogue Business published more than 80 articles talking about the downturn in luxury goods. We discussed this issue with Vogue Business Members at a live event and with fashion insiders at Industry Affairs. As my colleague Maliha Shoaib so succinctly put it in a team meeting, “[In the Vogue business]we are at our best when we address industry pain points.”
So we’re starting the year with a series of articles about how to survive the economic downturn, the luxury industry’s latest pain. First, Maliha surveyed around 1,000 consumers to find out how their luxury consumption habits have changed. Next, she delves into how to win back motivated shoppers. Christina Binkley examines the tactics employed by high-level corporate executives during the 2008 crash for lessons that apply today. Lucy Maguire and Bella Webb write survival guides for marketers and budding designers, respectively. Madeline Schulz enumerates ways brands can revamp their pricing and product strategies, and Nateisha Scott considers whether small luxuries like sunglasses, bag charms, and perfume can provide one solution. And Amy Francom finds out who wins in the downturn in the luxury goods market, from resellers to scammers.
Digging deeper, Laure Guilbeault and Luke Leach study the Hermès and Mytheresa success stories and piece together the cliff notes. José Cleares-Unzueta predicts fashion’s next big idea. What happens when athleisure defines the pandemic and quiet luxury is its aftermath? Finally, Hilary Milnes and Kirsty McGregor ask, “When will it all be over?” (which of course means slower speeds).
You can find everything at this link. I hope you found this article useful and you never have to read it again.
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