Underlining the geopolitical tumult and economic tightening that high-end brands have been weathering lately, the findings of new artificial intelligence (AI)-powered research have been released, suggesting that luxury labels look primed to surrender market dominance. 

In fact, the research by technology company Lectra has suggested that consumer fashion brands could shortly overtake their luxury counterparts. 

If this situation was to come to pass, it would give consumer brands a dominant role in global fashion sales that they have not enjoyed since 2010. 

2025 is looking increasingly like a transformational year for the fashion industry 

In putting together its new report, Lectra – which provides technical solutions for industrial sectors – drew upon data from its AI-based market intelligence tool, Retviews. 

As reported by the Fashion Network website, the research findings painted a picture of a luxury sector experiencing a fall in performance due to a worldwide sales slowdown and consumer fatigue. 

These effects have reportedly been especially pronounced in the United States. Indeed, McKinsey forecast in January that as a result of US import tariffs, consumer expenditure could drop by between $46 billion and $78 billion a year. This, in turn, could exert further pressure on prestige fashion, given the discretionary nature of the category. 

Premium positioning is becoming key to consumer brands’ approach 

On this backdrop, it is intriguing to see that fashion consumer brands are embracing premium pricing strategies to reposition themselves. 

According to the Retviews analysis, many brands are placing a greater emphasis on elevated product offerings as a means of differentiating themselves from fast-fashion competitors. 

An increasing tendency is being seen among brands in Europe to offer products above €25, as lower price-point assortments are scaled back. 

It should perhaps hardly be surprising, then, that the average price of fashion items on the “Old Continent” has gone up from €38 in 2023 to €42 this year. The US market, too, is showing evidence of this trend, with the same period seeing average prices climb from $57 to $64. 

An “unpredictable environment” for the world’s apparel players to contend with 

EMEA Region President at Lectra, Antonella Capelli, commented: “Optimising assortments, increasing direct sales, and enhancing market intelligence will be key to succeeding in such an unpredictable environment”. Some consumer fashion brands are evidently already winning through the adoption of such strategies. 

Lectra has suggested that many of these players are also modifying their promotional tactics, putting in place year-round low pricing strategies instead of relying on traditional seasonal discounting models. This allows for a rapid turnover of inventory while brand image and value perception are preserved. 

Skywire London can help put your high-end brand in a position to survive and grow 

2025 is continuing to show itself as a volatile time for many fashion, lifestyle, and luxury players. However, it is also an era that presents growth opportunities for those brands that commit to creativity, innovation, and the delivery of digital excellence. 

To find out more about how this could manifest when your business works alongside our UK-based, but global-minded luxury brands marketing agency, please don’t hesitate to contact the Skywire London team. 

Photo by Jack McPake on Unsplash