How will the aspirational, affluent and wealthy consumers adjust their spending in 2026 and what will that mean for luxury brands and retailers? Image credit: Shutterstock
After a year of creative resets, pricing recalibration and operational discipline, the global luxury business – which barely managed to hold its ground in 2025 – is on track to show growth this year.
The 2026 Global Luxury Industry Outlook report from management consultancy Kearney states 2026 is likely to deliver 2 to 4 percent growth, but unevenly distributed across regions, categories, and client tiers.
“Luxury isn’t entering a downturn – it’s entering a normalization phase,” said Nora Kleinewillinghoefer, Kearney’s partner and global lead for fashion and luxury, in a statement.
Five key findings stood out in report:
- Selective splurging is the new middle: Many consumers are not exiting luxury, but reallocating spend toward fewer, higher-conviction purchases.
- Value scrutiny is reshaping behavior: Brand loyalty is weakening outside core clients, with switching and reallocation becoming default responses to price pressure.
- China is stabilizing, not accelerating: Fragmentation, domestic confidence and experience prioritization point to a normalized growth trajectory rather than a rebound.
- AI is becoming foundational: Competitive advantage will shift toward brands that industrialize AI behind the scenes while preserving human-led creativity.
- In the world of luxury, 2026 is about earning relevance: Winners will prioritize resonance, discipline, and defensible growth over scale, speed or price escalation.
Three's the charm
Of course, nothing happens in business without a customer.
This year’s report was enhanced by original consumer research, which shows that luxury consumers, like all consumers, are works in progress.
“There isn’t just one stereotypical luxury consumer,” said Katie Thomas, lead of the Kearney Consumer Institute, in a statement.
“Our research identified three discrete profiles: aspirational consumers who selectively participate in the category, selective splurgers who balance restraint with continued engagement, and traditionalists, who spend freely and live a full luxury lifestyle, she said.
“But the market continues to fragment spend across categories, from traditional luxury houses to wellness and food and beverage.”
In other highlights from the report:
- Three regions – United States, Europe and China – are crucial to stabilizing the luxury business. Together, they provide the scale, infrastructure, and client concentration that anchor global luxury demand. The definition of luxury continues to evolve, as certain luxuries became democratized and others remain truly exclusive or scarce.
- Spending is becoming more concentrated and more intentional. The global luxury customer base continues to contract, with the top 2 percent of clients now accounting for nearly half of total spend.
- Technology will continue to shift competitive power. Embedded across forecasting, design, clienteling and service, AI is rapidly evolving from experimentation to infrastructure. AI systems increasingly influence discovery, filtering and purchase. Visibility is earned through clarity, data integrity and trust – and not brand heat alone.
- A new momentum is revolutionizing luxury offerings. Last year witnessed three times as many changes of creative directors than previous years – a clear sign that luxury houses are ready to reinvigorate their brands and offerings.
LOOKING AHEAD, Kearney’s luxury outlook finds that luxury is normalizing, not structurally declining. It predicts global economic volatility will persist, keeping margin pressures elevated.
However, continued price increases will raise the bar for perceived value.
Kearney anticipates that luxury growth will stay concentrated in top clients and experiences, while at the same time, aspirational consumers will continue to redefine how – and when – to engage with them.
“The brands that will win in 2026 won’t rely on scale or price increases alone,” Ms. Kleinewillinghoefer said. “They’ll earn relevance through creativity, clearer value and deeper consumer engagement.”