Global luxury apparel market to rebound slowly after 2024 setback – analysis

The global luxury apparel market will undergo a gradual recovery after a 2.4% contraction in 2024, analysis indicates.

According to GlobalData Global Luxury Apparel Market to 2029 report, growth will return in 2025, but it is expected to be largely fuelled by price increases rather than higher sales volumes.

Macro pressures including inflation across Europe and the US and a sharp slowdown in China dented consumer spending last year, producing the market’s first material setback in several years. GlobalData’s report forecasts that the sector will grow by 2.0% in 2025 as brands raise prices to protect margins, even as volumes continue to decline.

Over the 2024–29 period, the market is expected to grow at a compound annual rate (CAGR) of 2.8% and to begin outperforming the broader apparel market from 2028 as the finances of aspirational shoppers improve.

Clothing is projected to be the strongest category through 2029, with a 3.1% CAGR driven by ultra-wealthy consumers who remain willing to spend on trend-led pieces; womenswear is expected to outperform menswear. Accessories – led by luxury handbags as enduring status symbols – should record a 2.9% CAGR. Footwear looks set to be the weakest area, with a modest 1.0% CAGR, as strong demand for trainers from premium and mass-market specialists limits growth for high-end shoe categories.

Asia-Pacific will be the growth engine, posting the strongest regional CAGR of 4.0% between 2024 and 2029, supported by the recovery of China and robust growth in emerging Asian markets. In contrast, Europe and the Americas are forecast to experience softer growth – 1.8% and 1.5% CAGRs respectively – hampered by sluggish economies and the lingering effects of US tariffs. The Middle East and Africa will increase its share of the global market, with Saudi Arabia and the United Arab Emirates benefiting from tourism and strong domestic spending.

Luxury heavyweights retained power in 2024. Louis Vuitton remained the largest apparel brand, increasing its market share to 9.8%. Hermès was the standout performer, expanding share by 0.7 percentage points to 6.0% as its exclusivity and craftsmanship held strong appeal among the ultra-wealthy. Chanel also gained share, largely through strategic price increases. By contrast, brands such as Gucci and Burberry lost ground amid unclear positioning and weaker product offerings.

Luxury apparel rebound drivers

Several structural factors underpin the recovery outlook. Ultra-wealthy customers continue to provide a stabilising base for top-tier luxury houses, maintaining demand and preserving brand equity. Meanwhile, improvements in broader macroeconomic conditions and rising consumer confidence should gradually bring back aspirational shoppers – the expanding middle and upper-middle segments whose purchasing power was most affected during the downturn.

Social media and influencer marketing are playing an increasingly important role in engaging younger buyers. Luxury brands are courting content creators and leaning into platforms such as Instagram and TikTok to capture Gen Z’s appetite for luxury. Collaborations with celebrities, entertainment franchises and other brands continue to deliver cultural moments that drive excitement and sales.

At the same time, the booming resale market presents both opportunity and challenge. Resale apparel is expected to grow sharply – by nearly 48% between 2024 and 2028 – with luxury items particularly coveted as more affordable options. Some houses have partnered with resale platforms to reclaim share, but secondhand channels remain a threat to full-price sales, especially among budget-conscious aspirational shoppers.

China’s 2024 slowdown – driven in part by its real estate crisis – hit the market hard, and while stimulus should support a recovery in 2025, Chinese shoppers are likely to remain cautious, amplified by government messaging discouraging ostentatious displays of wealth. Online luxury retail also faces challenges: the collapse of major multi-brand platforms in 2024 has reinforced the importance of brick-and-mortar boutiques, where premium service and in-store experience are key to selling high-priced items.

"Global luxury apparel market to rebound slowly after 2024 setback – analysis" was originally created and published by Retail Insight Network, a GlobalData owned brand.

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