Luxury Brands Slash Price Hikes to 3% as Wealthy Shoppers Pull Back on Splurging
The golden era of luxury price gouging is officially over, and it’s about time. Premium fashion brands have dialed back their aggressive pricing strategies to the slowest pace since 2019, with luxury goods rising just 3% between January and May. The luxury sector’s retreat comes as wealthy shoppers shift toward smaller brands, fed up with years of price hikes that made once-attainable items feel out of reach.
- Louis VuittonLVMUY Speedy bags now start at $1.93K — double their 2019 price — while Chanel’s large flap bags jumped 80% to $13K, sparking backlash online.
- Companies drove 80% of their growth through price hikes rather than actual demand between 2019 and 2023, but that strategy backfired as “aspirational” consumers got priced out entirely.
High end, low demand: The luxury slump appears deeper than expected, with recovery now anticipated into late 2026. To make matters worse, the sector is bracing for another rough earnings season with LVMH set for a 3% sales drop while KeringPPRUY expects a 13% hit amid Gucci’s ongoing struggles. Brands like HermèsHESAY and RichemontCFRUY, who avoided aggressive price hikes, are now benefiting from “multiyear catch-up opportunities,” as former pricing leaders scramble to regain goodwill.