In the face of economic challenges, luxury brands are refocusing on high-net-worth individuals to sustain growth. However, a new McKinsey report highlights the significance of aspirational luxury consumers (ALCs) in the fashion market.
Understanding aspirations
Aspirational luxury consumers have become a hot topic: do they water down a brand’s image or are they the loyal customers of the future? Should luxury brands keep catering to their needs – and go for volume – or instead become more exclusive again to win over the truly wealthy?
A recent McKinsey report debunks a lot of myths about the (in)famous ALCs and proves their ongoing importance. These consumers, who spend between 3,000 and 10,000 euros annually on luxury goods, represent a substantial portion of the market and are crucial for long-term growth.
Aspirational luxury consumers account for 18% of the total fashion market value and 50% of the luxury market’s value across major markets, including China, the US, and Europe. Contrary to popular belief, ALCs are not predominantly young; nearly 60% are aged 35 or older. Additionally, these consumers are not solely driven by logo-centric products, as 70% express comfort with lesser-known brands.
