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This article is part of The Luxury Slowdown Survival Guide, a collection of articles that examines the recent industry downturn and the strategies brands may employ to come out of it unscathed.
Once occasional enthusiasts of luxury goods, aspirational shoppers are tightening their purse strings — or redirecting their discretionary income altogether. But where to?
While traditional luxury brands grapple with declining sales, other parts of the market are thriving. Affordable high street designer collaborations, secondhand resale platforms, dupes, counterfeits, premium grocery brands and experiential retail have emerged as unexpected winners, capturing the attention — and dollars — of consumers seeking value, sustainability or cultural relevance.
“Luxury’s meaning is evolving,” says Isobel Farmiloe, group brand strategy director at creative and cultural insight agency Dazed Studio, who recently authored the report ‘How Luxury Became a State of Mind’. Consumers, especially during a cost of living crisis, are more discerning about spending, meaning climate consciousness, craftsmanship, supply chain transparency, cultural relevance and meaningful experiences are becoming integral, she says. Brands and retailers tapping into these luxury values are winning big. But are these values merely a response to the current economic climate, driven by temporary shifts in consumer sentiment? Or do they signal a more profound and lasting transformation?
Here are five winners in the current slowdown, and what luxury brands can do to fight back.
1. Dupes
Amid the luxury slowdown, consumers are scrutinising the value of high-end goods more closely than ever, especially as prices rise while quality in some sectors appears to decline.
According to consultancy McKinsey, the average price of luxury goods has risen by 15 per cent year-on-year over the past three years. At the same time, consumers have been questioning luxury markups, after the Italian Competition Authority initiated an investigation in July over concerns about workers’ rights in the factories of some major luxury brands.
This frustration and scepticism over quality has fuelled the rise of ‘dupe culture’, where shoppers turn to high-quality imitations of luxury items that offer similar aesthetics and utility without the premium price tag. Approximately a third of US adults have deliberately purchased a dupe, according to intelligence firm Morning Consult, with the percentage climbing to nearly half among Gen Z shoppers and 44 per cent among millennials. In the UK, Mintel research reveals a similar trend, with 47 per cent of consumers open to buying luxury lookalikes in 2024 — a significant increase from just 12 per cent in 2016.
Counterfeits — which, unlike dupes, are illegal — are also on the rise. In 2024, the European Union experienced a significant surge in counterfeit goods, with authorities detaining 152 million fake items valued at €3.4 billion — a 77 per cent increase in quantity and a 68 per cent rise in value compared with 2023.
In a bold move to counter the growing dupe culture, Lululemon hosted a ‘dupe swap’ at LA’S Westfield Century City Mall in May 2023 where customers could exchange their Align dupes for an original pair free of charge. This initiative, the first of its kind, aimed to highlight the unmatched quality and attract new customers who might not have tried Lululemon. Others, like Charlotte Tilbury, have tackled the issue via creative campaigns that emphasise the uniqueness of their products. In August, for instance, the beauty brand released a TikTok video depicting its Hollywood Flawless Filter product in a photocopier, which then displayed messages like “Error! Copy impossible” and “Legends cannot be copied”.
“It’s an unfortunate truth, but dupe culture or designing more attainable products that reference traditional luxury silhouettes are especially attractive in this economy,” says Sara Leeds, senior creative strategist at youth culture agency Archrival, who found that almost half of Gen Zs (48 per cent) in the US use Amazon as a tool to hunt down dupes.
“[Luxury] prices have risen while quality has sometimes declined, frustrating consumers,” says Farmiloe. “The rise of dupe culture reflects this; people still aspire to luxury but may feel alternatives offer better value,” she continues, pointing to more premium dupe offerings like Quince and Italic, who sell unbranded, quality basics in similar styles to their luxury counterparts, which have become popular across social media.
As the increasing commercialisation of fashion leads to lacklustre, easily replicated designs, brands like Quince and Italic are given the opportunity to thrive. Quince, for example, has experienced substantial growth since its inception in 2018, with revenues growing more than doubling from $140 million in 2022 to $340.3 million in 2024.
“Luxury brands must reinforce their commitments to craftsmanship and durability, providing transparency into quality standards,” says Brittany Steiger, principal analyst of retail and e-commerce at market research firm Mintel. This demand for transparency has led to brands adopting technologies such as QR codes or blockchain, offering insight into when, where and how each item is produced, thereby enhancing perceptions of quality, she adds.
Additionally, luxury brands should consider how they create value for the consumer, says Steiger.
“While luxury brands don’t have to turn to deep discounts if it isn’t right for their brand, they should be looking at other ways to democratise access to luxury products,” she continues, adding that this could mean holding ‘dupe swap’ events, leveraging partnerships with buy-now, pay-later firms to add flexibility, or taking part in the growing secondhand market.
2. Resale
As climate consciousness grows, the traditional allure of ‘newness’ is being re-examined, with many consumers now viewing the purchase of new goods as unnecessary — even “dirty”, says Farmiloe. This mindset has furthered the rise of secondhand luxury, as consumers increasingly seek out ways to indulge their tastes while aligning with ethical and environmental values. Of course, affordability is also a draw — especially since vintage is often perceived as better quality in some cases than newer luxury goods (amid the aforementioned debate over luxury margins). Some 44 per cent of luxury consumers have purchased secondhand, resale or vintage in the past year, according to our exclusive survey of nearly 1,000 Vogue and GQ readers. And 46 per cent said they are more interested in purchasing secondhand luxury fashion items now than they were a year ago.
Luxury resale platform Vestiaire Collective reported a 25 per cent revenue increase last year, with plans to sustain that momentum despite broader economic challenges. “Affordability is and will always be the primary driver for buying pre-loved pieces, but this trend is declining,” notes a Vestiaire spokesperson. “What’s on the up is a trend towards more sustainable and ethical consumption. This is a reason that will continue to drive resale even as the economy improves.”
Luxury brands themselves are beginning to embrace the resale market, recognising it as an opportunity rather than a threat. In July, French design house Isabel Marant collaborated with Vestiaire Collective to curate a collection of pre-loved pieces, handpicked by the eponymous designer. Meanwhile, Alexander McQueen partnered with Vestiaire Collective to launch the ‘Brand Approved’ programme, where McQueen clients could sell their pre-owned items back to the brand in exchange for store credit.
Still, despite the burgeoning interest in secondhand luxury, many high-end brands have been slow to embrace the resale market. Some fear that participating in resale could cannibalise sales of new products and undermine their image of exclusivity. Others are concerned about the complexities of authenticating pre-owned items and the potential proliferation of counterfeits, which could erode consumer trust.
To future-proof their brands, luxury labels must build brand affinity with an emerging luxury consumer — one that is younger, less affluent and more diverse, says Steiger. Entering the luxury secondhand market is a great relationship-builder, allowing younger audiences to own a piece of a brand they admire, while their purchasing power continues to build. “These early relationships can pay off in the long run, allowing brands to further develop this engagement as their spending power expands.”
3. Brands that tap into the zeitgeist
Cultural relevance has become an essential way to establish meaningful connections with modern consumers. Today’s audience, empowered by social media and digital platforms, holds significant sway over the narrative.
“I think cultural relevance has always been important, but now, with this power shift where the audience holds much more power, brands are almost freaking out a bit. The rise of niche interests has made it so much harder for brands to keep up because there’s so much to understand,” says Farmiloe.
This sentiment explains why brands like Loewe — adept at leveraging the intricacies of digital culture — continue to thrive despite an industry-wide slowdown. Loewe’s TikTok strategy, which features collaborations with chronically online creators like Jake Shane and Izzi Poopi, has positioned the brand at the forefront of cultural conversation, ensuring it remains top of mind for digitally savvy consumers.
This shift underscores a deeper transformation in the way consumers interact with brands. Where shoppers once aspired to own high-end labels purely for their status, they now gravitate towards brands that resonate with their personal values, niche interests and social identities. It’s no longer solely about possessing a ‘luxury item’, it’s about participating in a broader cultural dialogue. In an age where cultural capital often outweighs traditional status signaling, brands that successfully tap into this dynamic are poised to thrive. Contemporary labels with high cultural capital and more premium price points are luring former luxury customers with design-led, high-quality fashion, backed up by savvy community-building.
For example, British premium streetwear brand Represent has embraced its northern cultural cachet. The brand has collaborated with Liam Gallagher, Stoke-on-Trent brand Belstaff and, most recently, Oasis, all while aligning with niche fitness communities that fuel its expansion. As a result, in October, the brand opened its first UK flagship in Manchester and anticipates a record turnover of £100 million by the end of the year. Cult Swedish menswear brand Our Legacy also won over aspirational shoppers (and minority investment from LVMH), with reported sales of £33 million for fiscal year ending 30 June 2024, marking a substantial increase from £24 million the previous year and £6 million in 2021.
4. High street and fast fashion
The high street is capitalising on the influx of consumers who once bought entry-level luxury by collaborating with fashion houses that aspirational shoppers can no longer afford to buy from.
“Aspirational shoppers turn away from luxury because of price. High street and mid-tier brands will inherently be the choice when this happens,” says Archrival’s Leeds, adding that brands can maintain this position by creating a brand story and marketing collateral that mirrors a luxury or aspirational lifestyle. “Brands like J Crew and Mango do a great job at this,” they add. Indeed, Mango has collaborated with French It-girl in London Camille Charrière who has previously worked with Miu Miu, Saint Laurent and Balenciaga, as well as British Vogue’s fashion features director Julia Hobbs.
It’s why this year has been rich with high street and designer collaborations. Zara unveiled a capsule collection in partnership with supermodel Kate Moss, as well as Stefano Pilati, the former head designer at Yves Saint Laurent. Marks Spencer joined forces with British designer Bella Freud and H&M partnered with Korean-based label Rokh.
Designer collaborations are also a long-standing cornerstone of H&M’s strategy, combining long-term cultural relevance, brand elevation and immediate commercial impact. “We monitor shifts in spending habits, social listening and customer feedback, and we can see that more than ever there is a growing interest for affordable fashion paired with quality and exceptional design,” says Sylwia Wennberg, H&M’s global head of external partnerships and collaborations.
In H&M’s case, its designer collaborations achieve dual objectives: building brand equity over the long term while driving short-term sales. “Both pillars are essential to our success but serve different purposes and elicit different responses,” Wennberg says. However, she also notes that regular collections play a crucial role in sustaining ongoing appeal. “Our 20th-anniversary guest designer’s pre-loved campaign showed that these collections become timeless. They’re styled and restyled long after their initial launch, creating a lasting impact,” she says.
5. The new ‘splurge’ items
Aspirational consumers still desire the high end, often shifting their focus to smaller, meaningful luxuries. “As consumers become more conscientious about their spending, they are prioritising luxury items that contribute to their happiness and well-being,” says Tamara Sender Ceron, associate director of fashion retail at Mintel.
A February report from McKinsey Company revealed that groceries have emerged as a top spending priority, particularly for younger generations. Surveying over 4,000 respondents from baby boomers to Gen Zs, the consultancy firm found that groceries were the most significant splurge category for millennials and Gen Z, outperforming traditional discretionary spending categories such as dining out, travel, beauty, apparel and fitness.
This reimagining of groceries as a ‘splurge’ category reflects broader cultural shifts in how consumers prioritise their spending. Health, sustainability and quality have replaced mere status as primary motivators. By elevating essential purchases into meaningful experiences, younger consumers are reframing their relationships with luxury — turning a need into a luxury, rather than a want.
The rise of premium and organic grocery options underscores this shift. At the recent Organic Trade Conference, it was reported that organic food and drink sales are growing at a faster rate than their non-organic counterparts, with UK value sales up 6.4 per cent compared to 5.4 per cent for conventional products.
Innovative platforms and brands are capitalising on this trend, transforming how consumers perceive and purchase groceries. Delli, a food marketplace founded by Depop creator Simon Beckerman, serves as a prime example. Providing a platform for small-scale producers to sell their artisanal goods, Delli has seen explosive growth, securing a $6 million seed extension in September following a staggering sixteenfold increase in revenue in 2024. Similarly, unconventional brands like Liquid Death — a canned water company — have transformed a mundane product into a status symbol. Recently valued at $1.4 billion, Liquid Death has partnered with skateboarder Tony Hawk and become a hit with Gen Z for its incendiary marketing taglines.
The increasing cultural cachet of food has not gone unnoticed by traditional luxury brands. High-end labels are expanding into the hospitality sector, blending retail with experiential dining. Louis Vuitton recently unveiled a much-hyped café at Heathrow Airport, strategically positioned to capture affluent travellers. Prada has followed suit, opening chic in-store eateries that serve as stylish extensions of its brand identity. Even cult favorite Aimé Leon Dore has embraced the trend, integrating a café into its flagship store that has become immensely popular on TikTok, with the accompanying hashtag #AimeLeonDoreCafe garnering over 45,000 posts.
As shoppers recalibrate their priorities, brands that adapt to these nuanced desires — offering cultural relevance, cost value and ethical practices — will emerge as true winners in this reimagined luxury era.
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