Hermès’s financial results continue to outpace the luxury sector, with revenues up 9 per cent year-on-year to €3.9 billion in the second quarter of 2025, the company announced last week. The brand has consistently bucked market slowdowns while competitors have lagged, supported by its resilient high-net-worth-individual (HNWI) client base. In volatile times, it’s no wonder that others are looking to replicate the effect.
Hermès is one of a handful of ultra-luxury fashion brands, along with Brunello Cucinelli and Loro Piana, which are associated with super rich consumers. Hermès is the biggest, oldest and most prominent in this category, founded in 1837 with a market cap (the total value of a company’s outstanding stock shares) today of over €250 billion. Loro Piana was founded in 1924 and was acquired in 2013 by LVMH (the brand was valued at €2.7 billion at the time, and while LVMH doesn’t break out the performance of its individual brands, analysts note that Loro Piana tends to perform well). Brunello Cucinelli was founded in 1978 and has a market cap of €7 billion; revenues grew 10.2 per cent year-on-year in the first half of 2025 to €684 million.
Can newer brands follow their playbooks? The Row, Phoebe Philo and Gabriela Hearst are each vying for a seat at the ultra-luxury table, but it’s not an easy status to obtain.
What defines an ultra-luxury brand? Experts say it’s a combination of pricing power, exclusivity, an emphasis on craftsmanship and quality, and minimal marketing with a lack of paid celebrity endorsements. “Ultra-luxury purchases are not driven by price but by emotion, rarity and the pursuit of enrichment,” says Oscar Sand, academic director and master in luxury management at ESSEC Business School.
The ‘true luxury’ consumer — such as the HNWI who spends €50,000 to €500,000 annually on the likes of luxury goods, cars and wellness — makes up less than 1 per cent of the market while generating 23 per cent of the value, according to Boston Consulting Group’s (BCG) latest True Luxury Global Consumer Insights report, in partnership with Altagamma. The base of HNWIs is also expanding annually, according to the report, and 50 per cent of this group say they plan to increase spending by 5 to 25 per cent over the next 18 months.
The growing market of HNWIs presents an opportunity for brands to fill the space. While Hermès has long dominated the market, analysts say there’s room for others to offer something different. But ultra-luxury is synonymous with heritage in some ways, and that can take generations to build — it certainly can’t be recreated overnight, or with products or branding that don’t stand up to the necessary esteem.
Here, we break down the lessons on how to capture the high-net-worth customer in an increasingly competitive market.
Creating a status symbol
Regardless of the narrative that consumers tell about their values — that quality trumps all else — status and scarcity ultimately remain at the top, experts say. “No matter what segment of consumers we’re looking at, in the end, what people are looking for with luxury goods is status and a signifier,” says Fabrizio Ferraro, professor of the strategic management department and academic director of the Institute for Sustainability Leadership at IESE Business School. “In the ultra-luxury segment, the ideal case is that the product possesses no logo, it’s super exclusive and unique — and everyone in your circles knows it.”
The main threat for an ultra-luxury brand is ubiquity, says Maria Meita, global luxury goods analyst at Bernstein, so much so that some brands even discontinue a product once it becomes too popular. Hermès shows notable restraint.
“They are one of the only brands to truly have more demand than supply, with the exception of Rolex,” Erwan Rambourg, global head of consumer and retail research at HSBC, notes. The waiting lists for the iconic Kelly and Birkin bags indicate that the brand doesn’t use its pricing power as much as it could. “They’re thoughtful and think about the long term. A lot of brands have been victims of their own mistakes, increasing prices way too much, and as a consequence alienating customers.” The gamification effect of the waiting lists and rumours of quotas can be particularly exciting for a customer who otherwise has everything, Meita adds.
The Row appears to be taking a page out of this book, reducing the availability of its bestselling Margaux bag, which costs between $3,659 and $5,300. Fans noticed the brand hadn’t been restocking the bag as frequently last year, and it’s been pulled from The Row’s e-commerce site. Some have called it the “new Birkin” thanks to its apparently limited distribution and It-bag status.
But could The Row be the new Hermès? Founded in 2006 by Mary-Kate and Ashley Olsen, the brand has a similar mystique — avoiding overexposure, logos, advertising and relying instead on word-of-mouth desirability. It even snagged backing from the owners of Chanel and L’Oréal. Being a younger brand, there’s arguably more hype and buzz around it, though, and its minimalist aesthetic differs from Hermès’s luxury heritage offering.
Focus on quality
Brunello Cucinelli’s approach to exclusivity blends quality with status. The brand is based in Solomeo, a small medieval village located near Perugia, Italy, where Cucinelli’s wife is from. Born to a family of farmers, Cucinelli had an appreciation for a slower rural lifestyle, which has now translated into his philosophy of ‘humanistic capitalism’: the concept of minding profits alongside the well-being of people and the planet. Brunello Cucinelli’s strength lies in the way it invites customers into this brand universe.
“They do private events where [VICs] go to Solomeo and have the wine and olive oil that they make there, you have dinner with the family and it’s a networking opportunity,” says Meita. “It’s exciting for customers that it’s a members-only thing. They’re creating a heritage that can build into a long-term brand identity.” The other benefit is that by showing HNW customers the production chain, they become more convinced of the quality.
Gabriela Hearst offers a similar approach that appeals to customers who value craftsmanship and sustainability. Founded in 2015, the brand places a focus on high-quality natural materials and a DNA that has emerged from the designer’s Uruguayan ranch roots. Prices range from $1,300 to $4,000 for a handbag, to $15,000 for the priciest outerwear designs and upwards of $20,000 for exotic leather goods. Like Cucinelli, the brand is warmer in its approach than Hermès or The Row. But its focus with regards to sustainability differs slightly: Hearst is more explicitly focused on transparency and materials sourcing, while Cucinelli’s focus is on cultural philanthropy and a philosophy of life.
Hearst says her customer — a busy woman juggling a demanding professional and family life — values the integrity of the brand’s products and their high-quality natural fibres. “There has been an increase in price point in the luxury world, [but] that doesn’t mean the quality of the product has increased, so clients feel themselves paying more for something that is hard to understand,” Hearst says. “We have always maintained the term of honest luxury where we know the materials that we are using, where we are sourcing them, and how we’re making the product. Being aware that we are a small to medium-sized business, the customer knows that the price they are getting is great for an investment piece.”
The value of transparency goes far beyond customer demand, however; there are serious concerns over ethics in the supply chains of a number of luxury brands. The most recent incident was Loro Piana, which has been placed under a 12-month court administration over allegations of worker exploitation in its supply chain. The brand said in a statement shared with Vogue Business that it was not informed by its supplier of any subcontractors and that it “terminated all relations with the concerned supplier in less than 24 hours”, “condemns any illegal practices” and “reaffirms its unwavering commitment to upholding human rights and compliance” in its supply chain.
Experts agree the perception of quality is of utmost importance in the ultra-luxury market, but they have doubts over how much HNW customers will react to scandals like these. “With Loro Piana, clearly the brand has at its core craftsmanship, heritage and materials, so the scandal feels more impactful because it’s at the core of the brand. But to say if there will be a meaningful impact on demand, I’m not sure,” says Mario Ortelli, managing director of luxury advisory firm Ortelli Co.
Competing in the ultra-luxury market
The ultra-luxury market may be stable, but even brands like Hermès and Loro Piana are “thinking about recruiting the next generation”, says Rambourg. They’re also vying for the attention of a consumer who is increasingly inundated by VIC outreach. According to BCG’s report, some HNWIs receive 40 to 60 instances of outreach from brands each month, with 60 per cent feeling overwhelmed by excessive marketing and a lack of personalisation. Their other pain points include a crowded and standardised retail experience, low product quality and defects, and a lack of top-tier status recognition, according to BCG.
“The entire market is concentrating on you, because you’re the only game around, so you’re being invited left, right and centre to different events and shows. At some stage, you don’t have endless time to allocate just to shopping. The issue is clearly about whether brands can keep offering something different,” says Rambourg.
Relationships are key. Brands should make efforts to ensure top sales associates are satisfied so they’re incentivised to stay. “Because of the value of relationships in this segment, there’s a war for uber-qualified sales associates. If you’ve been selling high-end bespoke jewellery at Cartier for 15 years and you move to Van Cleef Arpels, you tend to take your clients with you because they may be buying the brand because of the relationship you’ve built over time,” Rambourg says.
All things equal, there are some fundamental differences between brands like Hermès, Brunello Cucinelli and Loro Piana that dictate the way they compete for this customer. “One of the questions I get from investors is, ‘Is Brunello Cucinelli where Hermès was 10 or 20 years ago?’ Hermès is bigger, but that could come in time for Brunello Cucinelli, so in terms of top line, yes. But structurally, Hermès is in a better position to be profitable because it’s a leather goods business rather than a ready-to-wear business,” says Meita.
Loro Piana also has a stronger focus on ready-to-wear, but it follows a traditional luxury playbook as an LVMH brand, while Cucinelli diverts in some areas, Meita notes; Brunello Cucinelli has outlet stores, around 30 per cent wholesale exposure, and offers discounts of up to 30 or 40 per cent, per Bernstein’s analysis. This allows the brand to bring in and clear inventory quicker and consistently offer newness, which their wardrobe-building customer values — particularly as the brand aims to sell full looks rather than a singular icon bag.
“Brunello Cucinelli can disregard the rules of selling exclusivity by the million because they’re only selling to 500,000 clients, about 2 per cent of the HNWIs of the world,” Meita says. Despite the brand’s strong financial performance, it consistently reiterates the message that its aim is to grow slowly and sustainably, so scale seems like less of a priority. “The reason we don’t see [the outlet and wholesale exposure] affecting brand equity is because their target customer group is much smaller, and they’re not looking for discounts on The Outnet. That’s a completely different customer.”
Meanwhile, smaller brands like Phoebe Philo, The Row and Gabriela Hearst differ because of a bigger focus on the star designer who offers a specific creative vision and a more fashion-forward aesthetic.
How have they built such prestige in such a short period of time? Philo was able to capitalise on the dedicated she acquired after transforming Celine. She launched her brand to much fanfare in 2023, and prices range from £600 for a pair of earrings to £1,300 for a utility shirt and £7,700 for a teddy jacket. However, the question remains around whether the brand’s debut hype can be sustained in the long term to match the relevance of legacy players.
One of the key differences between ultra-luxury newcomers and legacy names is their approach to online retail. While Hermès, Loro Piana and Brunello Cucinelli lean into in-person experiences, The Row and Phoebe Philo in particular are digital-first. The Row has only five stores globally, but is stocked at retailers including Mytheresa, Selfridges and Net-a-Porter. Philo launched with an online-only offering, but has since expanded her wholesale roster, adding seven retailers including Bergdorf Goodman and Dover Street Market last year and five in China last month, and is also reportedly eyeing a flagship opening in London. The challenge is to strike a balance between offering the in-person touchpoints that a customer paying eye-watering prices might desire without risking dilution — though their cautious growth models suggest awareness of this tension.
Ultimately, experts say, there’s space for these brands to join the category. They’re complementary to the likes of Hermès, Loro Piana and Brunello Cucinelli, rather than a threat. “It’s a similar positioning, but you look at the idea of exclusivity with a different lens. It’s for a customer that wants to express individuality,” says Ortelli. “These brands want to target a sophisticated consumer and bring some of that fashion sparkle.” The Row, Phoebe Philo and Gabriela Hearst are, notably, founded by women, where most heritage brands (with the exception of Chanel) are founded by men. As the spending power of women across the world continues to grow (some data shows that young women are currently outearning young men), products designed by and for women could stand out as more relevant and desirable to a growing pool of future female VICs.
Can these emerging ultra-luxury players truly overthrow the legacy brands? The answer lies in their ability to build a heritage that matches the strong DNA they’ve already fostered. Heritage relies on storytelling and emotional resonance, so a big-name designer and a coolly detached branding approach can only take them. For these brands to build heritage, they will have to strategically negotiate exclusivity with connection. Needless to say, the journey to become the next Hermès in today’s era requires a different playbook than the 188-year-old brand’s.
Any enduring ultra-luxury house will need to go beyond quiet luxury to offer newness and innovation that is highly desired by the HNW customers of today and tomorrow. “No one needs any luxury product. So, because you have no purpose, the idea is to make it fun, to make it lively, to make it joyful,” says Rambourg. “The next generation won’t buy you because you’re quiet, they’ll buy you because you’re fun and differentiated.”
This article has been updated to add Gabriela Hearst s comment (6/8/25).
Comments, questions or feedback? Email us at feedback@voguebusiness.com.
