According to McKinsey’s 2025 State of Luxury Fashion report, the personal luxury goods industry – covering leather goods, watches, jewellery and clothing – expanded at an average of five per cent per year between 2019 and 2023, outpacing global GDP growth by two points, while brands lifted prices by roughly four per cent annually.
Industry analysts say the growth was largely fuelled by high‑earners whose incomes appear secure on paper but who face rising interest rates, job‑security concerns and stock‑market volatility; when those pressures mount, luxury purchases are often the first expense to be trimmed.
Hanushka Toni, founder and chief executive of resale platform Sellier, warned that the “squeezed middle” is now pausing at the checkout, comparing the cost of a new designer bag with the appeal of pre‑owned pieces that are cheaper and sometimes rarer.
Resale platforms are capitalising on that caution, offering consumers access to older, discontinued items that are no longer stocked in boutiques, a value proposition that is resonating with shoppers looking to stretch limited budgets while still enjoying brand cachet.
The shift is also encouraging high‑street retailers to adopt a more upscale presentation; Marks & Spencer is set to make its runway debut at London Fashion Week this September, and H&M‑owned & Other Stories will bring Jonathan Saunders on board as chief creative officer in 2025, moves that blur the line between mass‑market and luxury experiences.
Experts predict that luxury houses will need to adapt their pricing and distribution strategies as the middle segment, once a key growth engine, becomes more price‑sensitive and increasingly turns to resale and premium high‑street alternatives.