This Vogue Business Index article is part of our Advanced Membership package. To enjoy unlimited access to The Long View from Vogue Business, The Fashion Exec s Guide and bi-monthly Market Insights Reports, sign up for Advanced Membership here.
Key takeaways:
- Virtual victories help to propel Versace and Hugo Boss. Less than half (28/60) of brands assessed offered augmented reality (AR) or virtual reality (VR) features during the latest assessment period, with virtual try-on becoming increasingly popular and immersive VR experiences providing a popular format for brand storytelling. New devices like the Apple Vision Pro are helping to create a stronger infrastructure for delivering virtual experiences.
- New legislation makes traceability mandatory. The number of brands providing traceability information using tools such as blockchain has increased from 32 to 36 out of 60 since the last Index. With the EU introducing new legal requirements for digital product passports (DPPs), this figure should rapidly rise over the coming year. However, unifying supply chain visibility with customer-facing benefits such as loyalty schemes or warranties still represents a continuing challenge for brands.
- Rental and resale fall out of favour. Despite offering a way for luxury labels to recruit more aspirational shoppers, especially in a tighter economy, the number of brands integrating rental and resale as part of their channel mix has declined since the last Index, with experiments such as archival pre-loved sales failing to materialise into permanent propositions. In contrast, the number of brands offering buy now, pay later, with partners like Klarna, has increased, indicating a strong industry push for shoppers to prioritise buying new, even in constrained circumstances.
Since the last Index, the innovation ranking has seen a shuffle in the top players, although Gucci has defended its lead position, which it has held since the innovation pillar was added in H1 2022. Innovation headlines over the last few months have been peppered with sustained interest in AR and VR experiences, while wearables and connected devices have also come to the fore. Good examples include Chanel’s Première Sound necklace, worn as a watch, and Gucci’s virtual reality film for Apple Vision Pro. Who is Sabato De Sarno? A Gucci Story is a 20-minute short documentary narrated by Paul Mescal, exemplifying how important it is that even leading brands continue to educate their fans and followers on the personalities leading their creative direction. Balenciaga has become the first luxury brand to bring its runway experience to Apple Vision Pro. Accessible through a new Balenciaga app, the experience offers the option to watch multiple runway videos, including the spring 2025 Shanghai show, with a clickable carousel lookbook.
While interest in gamification appears to have tempered over recent months (with 12 brands creating their own gamified experiences, down from 14 in the last Index), Maison Margiela has kept abreast of innovation in this space, maintaining initiatives such as its gamified minting platform. Beyond this, the arrival of its iconic split-toe Tabi shoe in the metaverse has seen the brand rise to the top five for innovation — an impressive feat for a brand that, in terms of revenue and scale, is far behind the nearest rivals for innovation, which include Gucci, Hugo Boss and Tommy Hilfiger. Versace has also been a bright spot in recent months, introducing its Mercury sneakers in Fortnite.
While Gucci has been hard to topple from its top spot, it appears to have removed its video shopping feature, suggesting a shift towards more tech-forward ways of delivering branded video experiences in new formats. Hugo Boss, which secured the second spot for innovation, also appears to have paused this feature.
AR, VR and virtual universes continue to expand
While still largely consisting of point-in-time activations, a number of brands in the Index continue to experiment with virtual stores and virtual worlds. Less than half the brands in the Index (28/60) offered some sort of AR or VR feature in the last year, with many making this an ongoing part of their digital offer. Hugo Boss, who has previously had a presence at Metaverse Fashion Week and created virtual experiences with Web3 company Imaginary Ones, created a “Planet Hugo” activation in March on Roblox to promote its denim ranges. Versace, meanwhile, paired up with Snapchat to create the Versace Mercury Lens, leveraging both the front and back cameras of smartphones to allow consumers to discover its new collection in 3D.
Chanel also connected with culture through its multisensory “Le Bal de Paris” virtual ballroom. The theatrical experience created by Spanish choreographer and filmmaker Blanca Li used room-scale VR and full-body tracking to fully immerse its audience, with users also able to try on several virtual Chanel designs. Activations like these reflect Chanel’s cultural positioning in the luxury world, with 57 per cent of global respondents agreeing that the brand makes them feel connected to those in the know about fashion.
Fluctuating interest in NFTs
Louis Vuitton continued its Via NFT project in April 2024 with the launch of its phygital varsity jacket. Costing €7,900 — and available to the 200 members of its Via community — holders of the collectible NFT are able to purchase the physical jacket through a token-gated website. Meanwhile, Hugo Boss has tokenised its loyalty programme, launching a series of NFTs that unlock exclusive experiences, rewards and digital merchandise all tied to their previous purchases and interactions with the brand. Both cases highlight the importance of exclusivity and community while seamlessly connecting the online/offline experience with luxury.
These developments come at a time when the appetite for NFTs has been mixed, especially as some activations have been mired in controversy, and it’s not just brands that are navigating the challenges of the NFT market. GameStop, one of America’s leading gaming retailers, also announced the decision to wind down its NFT marketplace operations at the beginning of this year — another indication that the industry infrastructure for leveraging NFTs successfully is still relatively immature.
.png)
New legislation propels traceability programmes
Incoming legislation from the European Union will make the provision of a digital product passport with luxury goods a mandatory condition of sale. DPPs, which assign a unique digital identity to physical goods, enhance transparency and visibility of the supply chain by organising data around material sourcing, production processes, manufacturing and transportation emissions and other supply chain criteria. Not only do they provide more visibility around sustainability and provenance, but they also serve as a digital identity for products, helping to guarantee authenticity and boost confidence in the resale market for luxury goods. These are features that consumers are enthusiastic about, with 47 per cent being interested in a brand sharing traceable details about products and their supply chain. While NFTs are not essential for the development of DPPs, brand exploration of blockchain-enabled DPPs may fuel interest in NFTs.
The challenge for brands, aside from complying with this new legislation as it comes into effect in 2026, is unifying it with other technology investments to create customer service efficiencies. Beyond providing product details, as DPP systems become more sophisticated, they could provide other clienteling benefits, for example, functioning as a pass that unlocks post-sale services such as repairs, resale, or even exclusive incentives and invitations to events. Coach recently followed Chloé in its launch of “instant resale” using DPP technology. At present, there is lots of entrepreneurial activity, with companies like Seamm and Eon, and non-profits such as the Aura Blockchain Consortium, promising to rapidly deliver on DPPs and digital twins. However, the market is still fragmented, and few have found a way to seamlessly unify the provision of mandated data around sustainability with loyalty programmes or incentive schemes. This still represents a gap in the market, and while the trend towards DPPs will create another customer touchpoint for brands, it adds another layer of complexity in an industry that struggles to establish a single view of the customers across different channels.
%2520(1).png)
Matching made-to-order exclusivity with waste reduction
Another development that captures consumer demand for personalisation and serves to improve sustainability is the adoption of made-to-order. Both Armani and Etro have added made-to-order facilities to their propositions since the last Index. Armani provides a custom tailoring service, resulting in unique garments for shoppers. This new offering elevates the customer relationship, providing a high-touch, personalised experience and helping to eliminate waste and improve sustainability, as designs are crafted locally using artisanal methods and are unable to be returned. It’s a business model that’s challenging to scale but delivers on the ultra-luxury white-glove interactions that high-net-worth individuals desire from brands.
This could offer a stronger point of differentiation compared to rental or resale offerings, where adoption in the luxury sphere has been slow. In fact, the number of brands offering both rental and resale, whether as a proprietary scheme or via partnership, has fallen since the last Index, indicating how difficult these models can be to scale. Brands like Marni and Comme des Garçons offered point-in-time archive sales, but these have now ended and have not been replaced with a more permanent programme. That noted, increased collaboration efforts are helping to keep rental schemes on the map, especially in markets like the UK and the US. For example, UK department store leader John Lewis has extended its partnership with Hurr, which enables shoppers to rent brands like Hugo Boss through the platform. Meanwhile, peer-to-peer rental app By Rotation has launched a partnership with Airbnb, which will give users travelling for weddings access to a vast local rental wardrobe in the top 10 wedding guest destinations. Technology such as DPPs allows brands to improve on their current resale offerings, allowing for more streamlined sales.
Yet, while sharing economy models clearly represent an important growth opportunity that could support sustainability initiatives, the rising acceptance of buy-now, pay-later — from 36 to 39 out of 60 since the last Index — is a reminder that securing sales for new collections always takes top priority.
Versace goes virtual with Fortnite and Snapchat
In the last year, Italian luxury label Versace has seen significant success with the launch of its Mercury sneaker in virtual formats, most notably in Fortnite’s virtual universe. Its collaboration with the popular gaming franchise enabled players to wear digital versions of the sneakers in-game for a limited time. In honour of the partnership, popular gamer Agent 00 hosted a Twitch live stream giving viewers the chance to win a real pair of the coveted sneakers.
The Fortnite activation was just one example of how Versace is pursuing a presence in virtual worlds and augmented reality. The Mercury sneakers were also promoted through a partnership with Snapchat. Snapchat users could engage with a fully immersive experience, the Versace Mercury Lens, which made use of both the front and back cameras of the user’s smartphone. This interactive journey invited visitors to try on the shoe in AR. The experience was coupled with Bitmoji, Snapchat’s Avatar creator, to enable Snapchatters to acquire digital versions of the sneaker for their Bitmoji, alongside 12 other signature designs from the brand.
These innovative moves from Versace come at a time when brand investment in virtual experiences and digital worlds is increasing, helping Versace to build new relevance. And, by activating in popular digital environments like Fortnite and Snapchat, Versace is forging stronger relationships with a new cohort of digital-first consumers, especially Gen Z, whose appreciation for digital fashion far outpaces their predecessors.
.png)
Sign up to receive the Vogue Business newsletter for the latest luxury news and insights, plus exclusive membership discounts.
Comments, questions or feedback? Email us at feedback@voguebusiness.com.
You can learn more about the Vogue Business Index and Advanced Membership here.
