The State of Luxury Fashion in 2024: A Tale of Two Markets
Looking at luxury fashion's down year, the strategies of the outliers in Brunello Cucinelli and Mui Mui, and the creative director carousel
What is the luxury fashion market like in 2024?
We'll need to look beneath the surface numbers. Bain & Company reports a market contraction of -2% year-over-year growth from $385 billion to $378.5 billion, but the slodown is only one part of the story; the more interesting parts are in the divergence.
The Slowdown Explained
The luxury goods market will have its weakest year in terms of sales growth since the pandemic. The behemoths in LVMH and Kering, as well as middle conglomerates like Capri Holdings (owner of Michael Kors, Versace, Jimmy Choo), all the way to independent houses like Burberry, Ferragamo and Mulberry all reported declining sales growth in 2024.
Economic pressures such as inflation in Europe and the US, the downturn in China which has been a key market for luxury fashion, as well as tighter finances in the middle-income consumers contributed to the weak performance. There's also a change in consumer behavior, with “quiet luxury” remaining strong in 2024, valuing craftsmanship and timeless designs over flashy logos and more experimental silhouettes.
This may not last long, with some industry experts viewing it as a more cyclical adjustment than a long-term trend. But it's clear that there will need to be an adjustment across the board, primarily with a focus on cost control and optimizing distribution, finding innovative ways to reach audiences and market to them in a way that justifies higher prices in a challenging economy and an extremely competitive industry, and perhaps new product lines to expand the brand.
The Outlier in Ultra-Luxury
There are some brands in the ultra-luxury segment that bucked the trend. Brunello Cucinelli's saw a 12% sales increase, while Hermès grew by 14%, and while parent Kering was down overall, its subsidiary Bottega Veneta is up 5% year over year. These aren't just statistics—they're proof that at the highest end of the market, there's possibility to be robust to broader market trends.
The boring explanation would be that there are simply more millionaires and billionaires each year who can purchase ultra-luxury. But what's truly interesting is how these brands have maintained their allure by staying true to their core identity, refusing to chase trends or dilute their offering for broader appeal.
Cucinelli's strategy in 2024 aligned with their core principles:
- Preserve human connection
- Celebrate individual stories
- Promote sustainable, meaningful consumption
- Extend the brand's humanistic enterprise philosophy
They maintained focus on the high-end luxury segment, emphasizing craftsmanship and exclusivity, continued to develop the concept of “Gentle Luxury,” which resonated strongly with customers, and expanded into new product categories, including eyewear and fragrances, through strategic partnerships. They continued strong growth in the Americas and Asia, bucking trends for almost everyone else in luxury fashion, and maintained a balanced approach to geographical expansion, reducing dependence on any single market (and thus more resistant to economic shocks in China and South Korea) allowing them to stay true to their estimated +10% growth through 2024.
They expanded their digital presence introducing a website built with AI to drive further the brand and Brunello Cucinelli's story and philosophy around artisan craftsmanship and their brand values of Humanistic Capitalism and Humanistic Sustainability.
To support long-term growth, they initiated a substantial investment plan to begin construction of new production facilities in Penne, Abruzzo, and Gubbio, to focus on expanding artisan production capacity, and to design new factories to be welcoming and spacious, adhering to the “beautiful factory” concept.
From their H2 2024 earnings report (emphasis theirs):
We believe that customers for luxury goods, when they comment that prices and profits are not always justified, are paying more and more attention to companies’ behaviour, to their manufacturing practices, to the conditions for blue-collar workers from a moral perspective, to wage levels and to conditions in the workplace, issues that we envisage will be the focus of increasing attention in the future. These aspects underpin the concepts of Humanistic Capitalism and Human Sustainability promoted by the company since its foundation, which we believe allows customers inspired by this new sensibility to appreciate how it is reflected in the history and present-day operations of the brand.
Furthermore, another development we are pleased to note is the increasingly widespread, conscious and attentive quest for a special and exclusive type of product, with a constant increase in demand for rare products of exquisite craftsmanship. Creating unique goods of the finest artisanal quality, whose value endures over time, has always been one of the key objectives of our Casa di Moda, and naturally we find the growing demand for this type of product highly satisfying.
The Psychology of Ultra-Luxury
What makes someone spend $6,000 on a cashmere sweater when perfectly good ones exist for a fraction of the price? It's not just about quality or craftsmanship, though these brands certainly excel in both. It's about what wearing that sweater says about who you are—or perhaps more accurately, who you believe yourself to be.
This is where ultra-luxury diverges most sharply from mass luxury. The latter sells the promise of elevation—the idea that buying this bag or that coat will somehow transform you. Ultra-luxury, paradoxically, often sells to people who feel they've already arrived. It's not about transformation but about confirmation. And Brunello Cucinelli's strides across their stores, e-commerce presence, wholesale, marketing, and their overall strategy is paying dividends — with revenues of $325 million in Q2 2024, up from $322 million in Q1 2024 — despite a down year for the entire segment.
The Miu Miu Paradox
And then there's Miu Miu, Prada's litter sister brand at the heart of mass-market luxury, presents us with a fascinating paradox. In an industry obsessed with perfection and a segment that's largely at standstill for the year, they've doubled their sales by staying true to their essence in embracing imperfection and speaking to their core audience in innovative yet authentic ways. The “Miu Miu Girl” isn't about flawless presentation—according to Fashionista, she's about contradiction: Innocent yet mischievous. Elusive yet recognizable. Unhinged yet put-together.
What makes this remarkable isn't just the sales growth— of Q3 2024, net revenues rose to $4.2 billion which is 15% growth through nine months and retail sales up 97% year-over-year, they're up in every region globally—but how they've achieved it.
From Prada's Q3 2024 report (emphasis mine):
Miu Miu kept capitalising its sharp positioning, built on a strong and distinctive identity. The brand’s cross-pollination of fashion, cinema and other arts continued to stimulate the cultural debate, consolidating the brand legacy and feeding the engagement with its global community. The immersive, site-specific art project Miu Miu Tales & Tellers, presented in the framework of Art Basel Paris, contributed to enhance the brand's tension to play across the spectrum of different artistic disciplines. Impactful creativity and communication drove the brand’s consistent outperformance, leading to widespread appreciation across all product categories and geographies. The SS25 fashion show continued to build Miu Miu’s world of diverse and fierce individuals, leveraging the aesthetic codes developed over the years.
Their approach reveals three deeper truths about luxury today:
First, authenticity comes from embracing contradictions, not resolving them. Miu Miu's deliberately wrinkled skirts and overstuffed bags aren't mistakes—they're statements about identity. In a world where everyone else is trying to present a perfect image on social media, there's something rebellious about choosing to be deliberately disheveled.
Second, cultural relevance doesn't require constant noise. While others flood the market with collaborations, Miu Miu's strategy is surgical. Their partnership with New Balance reimagined the 530 sneaker with leather and suede, a new ultra-flat sole mimicking the look of the ballet flats and loafers they helped reignite into the fashion scene, and mismatched and different color and style laces, perfectly capturing their intentionally unkempt aesthetic. The Church's collaboration (also owned by the Prada Group) elevated traditional Oxford shoes with ballet-inspired ribbons—a perfect embodiment of the brand's contradiction between proper and playful.
Their cultural programming is equally precise. The Women's Tales film series commissions female directors to create short films that never directly promote products but instead explore women's stories. Recent editions have featured emerging directors from South Korea and Argentina, expanding the brand's cultural footprint. The Miu Miu Summer Reads initiative transformed newsstands in global cities into feminist literary hubs, distributing works by authors like Joan Didion and Virginia Woolf alongside their campaign imagery. These aren't just marketing efforts—they're meaningful cultural contributions that position the brand within broader conversations about femininity, power, and identity.
Miu Miu Summer Reads, designed by 2x4
The brand has also mastered the art of viral moments without seeming to chase them. Their micro-mini skirt from Spring/Summer 2022 spawned countless imitations and became a cultural phenomenon, while their ballet flats with socks styling sparked a global trend. Yet these moments feel organic, emerging from the brand's authentic exploration of style rather than calculated attempts at virality.
Third, and perhaps most importantly, they've understood that luxury isn't about who you exclude, but who you invite in. Their approach transcends traditional demographic boundaries, creating a psychographic that anyone can aspire to, regardless of their ability to purchase.
The Cultural Currency of Luxury
Miu Miu's success points to a larger truth about luxury today: cultural currency has become as valuable as financial currency. Their #MiuMiuGirlsCamp hashtag on RED, with over 100 million views, shows how a luxury brand can create community without compromising exclusivity.
This is where many luxury brands stumble. They mistake social media presence for cultural relevance, pumping out content without understanding that true engagement isn't about frequency but resonance. Miu Miu's approach—fewer but more meaningful interventions—suggests a different path.
The Creative Director Conundrum
The recent carousel of creative directors raises deeper questions about creativity and commerce in luxury. According to Bernstein, it takes five years for a brand to reach peak earnings after installing a new creative director. This isn't just about patience—it's about the time required to build authentic identity.
But there's something else happening here too. The creative director role has evolved from artistic visionary to brand architect. Today's creative directors don't just design collections—they're expected to be storytellers, social media savants, and business strategists all at once.
Recent months have seen:
- Matthieu Blazy, arguably the splashiest new hire, move from Bottega Veneta to Chanel,
- Louise Trotter from French brand Carven will be replacing him at Bottega Veneta,
- Alesandro Michele who sent Gucci to staggering new heights before stepping down in 2022 moved to Valentino earlier in the year
- Julian Klausner, then head of womenswear at Dries Van Noten, is now its new creative director,
- Sarah Burton who spent 26 years at Alexander McQueen is now at Givenchy, and
- Michael Rider, previously at Ralph Lauren and a design director under Phoebe Philo, will be returning to Celine to replace Hedi Slimane at the helm.
The Rise and Fall of Creative Freedom
Consider Alessandro Michele's tenure at Gucci. His maximalist aesthetic didn't just change how the brand looked—it changed how the entire industry thought about luxury. But even this revolutionary success eventually gave way to commercial pressures. This raises an uncomfortable question: in today's luxury landscape, is true creative freedom possible?
The pressure for continuous growth seems fundamentally at odds with the time and space needed for genuine creativity. When every collection must outperform the last, when every social media post must generate more engagement, what happens to the quiet moments where real innovation occurs?
The Entrepreneurship Question
Perhaps the most telling shift is how today's most talented designers like Hedi Slimane are seemingly reluctant to launch their own brands. The path taken by Tom Ford and Thom Browne seems less appealing, even as Phoebe Philo's 2023 launch generates buzz.
As Vanessa Friedman of The New York Times points out, the major groups prefer investing in established houses rather than creating new ones because it's viewed as too expensive and riskyeven LVMH couldn't make Fenty by Rihanna work.
But this raises a more fundamental question: what happens to creativity when the greatest talents become employees rather than entrepreneurs? Can you blame someone like Hedi Slimane who prefers to leave a fashion house at both its cultural and economic peak before he gets unceremoniously fired? Is there still a place for a Karl Lagerfeld who was able to stay in a single house for 25 years (ultimately until his death)? Perhaps this concept is no longer and was more the outlier than the norm. Even namesake's don't stay at their own brand forever (see: Philip Lim leaving 3.1 Philip Lim or Raf Simons shutting down his namesake). Maybe full independence is also becoming a thing of the past.
The Digital Dilemma
Luxury brands face another paradox in the digital age: how to maintain exclusivity while being omnipresent online. Social media demands constant content, but luxury thrives on scarcity. Some brands, like Bottega Veneta, have experimented with digital abstinence, deleting their social media presence entirely. Others, like Balenciaga, create viral moments that blur the line between luxury and meme.
But perhaps the most interesting approach is what we might call “digital craftsmanship”—treating online presence with the same attention to detail and selectivity as physical products. Miu Miu's success suggests that in the digital realm, as in the physical, less can indeed be more.
The Sustainability Imperative
Another challenge facing luxury brands is the growing demand for sustainability. This isn't just about using organic materials or reducing carbon footprints—it's about fundamentally rethinking what luxury means in an age of climate crisis. Can a brand truly be luxurious if it's not sustainable? More importantly, can it be sustainable if it's built on a model of constant growth and consumption?
Some ultra-luxury brands are leading the way here. Brunello Cucinelli's “humanistic capitalism” isn't just marketing—it's a different way of thinking about luxury, one that values human and environmental well-being alongside profit. But scaling this approach remains a challenge.
The Path Forward
Ultimately, luxury's future isn't about choosing between exclusivity and accessibility, but about understanding what we really value. The brands that succeed will be those that:
- Create authentic cultural conversations rather than just joining them
- Form partnerships that enhance rather than dilute their identity
- Meet consumers where they are while maintaining their core values
- Understand that true luxury takes time—both to create and to appreciate
- Navigate digital presence without sacrificing brand mystique
- Address sustainability not as a trend but as a core value
- Balance creative freedom with commercial success
The pain points are clear: economic headwinds, geopolitical challenges, and the constant pressure to grow. But perhaps what luxury really needs isn't more growth, but more clarity about what it wants to be. After all, in a world where everything is marketed as luxury, true luxury might just be knowing exactly who you are.
The Future of Desire
As we look ahead, the question isn't whether luxury will survive—it will—but what form it will take. Will we see a further bifurcation between ultra-luxury and mass luxury? Will new models emerge that challenge our very conception of what luxury means?
The answers may lie not in market research or trend forecasting, but in understanding human desire itself. What do we really want from luxury? Status? Beauty? Connection? Identity? The brands that can answer these questions authentically, while navigating the practical challenges of commerce, will define luxury's next chapter.
A Final Thought
The most successful luxury brands have always understood something fundamental: they're not selling products, they're selling dreams. But today's consumers dream differently than their predecessors. They dream of sustainability, of authenticity, of meaning. The luxury brands that survive and thrive will be those that help us dream new dreams—ones that reconcile our desire for beauty and exclusivity with our need for purpose and connection.
After all, isn't that what true luxury has always been about? Not just possessing beautiful things, but being part of something beautiful, meaningful, and rare. In a world of mass production and instant gratification, perhaps the ultimate luxury is taking the time to create something worth waiting for.