On Thursday 15th May, over 300 of the luxury sector's leading voices gathered at The Londoner in the capital for the Walpole British Luxury Summit 2025. This year's event brought together visionary designers, business leaders, creative voices, analysts, museum curators, research partners, editors, and our first neuroscientist in a programme that covered the main strategic priorities for the sector and tackled the realities of the current trading climate. Importantly, it focused on the most compelling prospects that every luxury brand should focus on for the year ahead.
While not shying away from being honest about the challenging business landscape right now, a number of our speakers were clear that there remains plenty of opportunity – brands must be resilient, nimble and creative enough to know where to find it and how to capture it. Never has it been more important to have a forensic knowledge of your customers put increased focus on design and craftsmanship, and create unforgettable experiences to forge even closer bonds with your most important customers.
Here, we’re highlighting just a few of the crucial takeaways from this year’s Summit, bringing together a number of the recurring themes from across the day.
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Among our Summit speakers there was a strong consensus that the luxury industry had become too secure with the new status quo of growth in the wake of Covid. As the ‘revenge spending’ trend waned, those who rested on their laurels haven’t delivered the creativity or inspiration that customers desire.
"We had meteoric growth and the luxury brands became complacent," explained Michael Ward, Chair of Walpole and Managing Director of Harrods. Ward’s sentiments were backed up by research from Bain & Company, which found that 10 to 15% of the world’s 400 million luxury customers have disappeared in the last year. This, said Senior Manager Andrea Steiner, is not only because of macroeconomic pressures but also "detachment towards brands, lower creativity and price hikes that were not fully paired with a similar increase in the value proposition."
However, given the belief that many of the luxury sectors current challenges are partially self-inflicted, as such they can be rectified with the right strategies. A bright spot, said Ward,"is the brands that have returned to their original DNA, like Miu Miu, where they've gone back to playfulness and creativity. A brand that was in the doldrums is now absolutely flying because its creativity is what the customer wants.”
With American and Chinese customers accounting for around 60% of the global luxury market, deciphering the impact of the macroeconomic and political landscape of these markets on luxury customers is a strategic priority. With the US in particular, as Jon Yeomans, Business Editor at The Sunday Times, explained, this means "we must expect the unexpected” for the foreseeable future, highlighting “this is an administration that thrives on uncertainty".
For Erwan Rambourg, Global Head of Consumer & Retail Equity Research at HSBC, there are glimmers of hope. "I still view the US as a recruitment market – most brands in the US are under-penetrated in terms of awareness," he said. However, he cautioned that consumer confidence was being affected: "In the US, I don't think you buy because you’re wealthy, I think you buy because you’re confident about the future and that consumer confidence is being impaired."
The slowdown for luxury in China has been well documented and Yeomans predicted any recovery may be clouded by the country’s geopolitical landscape: "We know the country has been hit by rising debt, falling property values, flatlining consumer confidence.
"China has been psychologically impaired at the consumer level for quite a while now but in the Chinese economy, they think for the next 15 years, not for the next quarter," said Rambourg. "So we're not factoring in a V-shaped recovery for the Chinese cluster – we are factoring in more of a ‘Nike swoosh’, very gradual recovery."
Compounding this recovery is the emergence of Japan as a centre of growth, driven by the current weakness of the yen, making it a highly attractive destination for Chinese luxury consumers. While shopping in mainland China has decreased by almost 20%, says Steiner, in comparison “regions like Japan have been growing at double digit rates. It's a market set to grow almost 20% fuelled by Chinese, Americans and Europeans flying to Japan for travel and shopping for luxury.”
While Steiner was clear that there is no ‘white knight’ to fill the gap left by the China slowdown, he cites growth coming from "the sum of a number of smaller markets", pointing to South-East Asia and Latin America as emerging hubs. He also highlights the Middle East as one of the areas with the most resilient demand, a region which has seen steady growth of between 8 to 10% annually with Patrick Chaloub, Executive Chairman of the Chaloub Group, echoing the potential for growth in the GCC.
While partly driven by an increase in tourism from the US and UK, Chalhoub also pointed to the GCC’s very young population (around 50% of locals are under the age of 25) as a key opportunity. “We have a young, wealthy population which means that they are more able to spend; the emergence of Gen Z, Gen A even, is much stronger in our part of the world," said Chalhoub. "We see a different mindset from this customer. The younger customer is really much more attached to sustainability than anyone else but they are eager for newness, they are reassured by strong brands, but they do not want boring, they are playful."
Likewise in India, said fashion designer Sabyasachi Mukherjee, a powerful new generation is ready to spend with the brands willing to put in the work to appeal and adapt to them. "Indians want to be heard, want to be seen, on their own terms. But this is also a time when there's a lot of money coming into the country, and we are dealing with probably one of the world's most vibrant, youngest and largest populations."
AI, said Greg Williams, Deputy Global Editorial Director at WIRED, has the potential to "transform businesses, organisations, behaviours and economies" – but it’s up to us to be the ones to adapt to this reality.
"How we fair in this rapidly evolving ecosystem really isn't down to the technology," he explains. "It's going to be determined by human ingenuity. How collaborative we are, how creative we are, how good we are at challenging our assumptions, how good we are about embracing change. The British luxury industry is really well placed because it's fundamentally a creative business."
A perfect example of this is the way Penhaligon’s has implemented AI tools to streamline global onboarding processes and freeing up room for creativity – as well as reshaping leadership strategies. "Hierarchy, in our world, doesn't really work anymore," said the brand's Global General Manager, Julia Koeppen. "The leadership team are not the traditionally native ones. When we look at new technologies, we need to give everyone a seat at the table and be willing to learn."
Chioma Nnadi, Head of Editorial Content at British Vogue, however, sounds a note of caution around over reliance on generative AI. "I don't know if we've quite reached the stage where we're using AI," she explained. "I have a healthy suspicion of it because, as a writer, your IP and your voice is so important. You can't replace the soul, especially in creative industries. Soul is the thing that creates desire, that creates longing, that drives things forward. ChatGPT is always going on existing information, it's restricted, it can’t create new ideas.”
Amrita Banta, Managing Director of Agility Research & Strategy, neatly summed up the changing priorities of UHNW consumers when she said, "Luxury for them is more relaxed, more intimate. A lot of UHNWs talk about ‘lean luxury’. They want to do things but discreetly, and a lot of them have become much more focused on the simpler things in life; family and meaningful experiences."
What this translates to on a more macro level is a big shift towards longevity or, as The Future Laboratory Co-Founder and CEO Chris Sanderson put it, "Our consumer is proactively looking for the brands, that are going to help them on their own journey of optimisation, to find ways to be healthier, wealthier and happier."
The idea of our bodies being our most valuable asset has given rise to a whole new sector of high-end offerings across health, hospitality, fitness, and beauty, with huge potential for inter-sectional growth and collaboration. "There's nothing more personalised than personalised healthcare," explains Kate Woodhouse, CEO of longevity clinic Hooke. "Effectively, the consumer becomes the product, and everything is tailored specifically for the individual. It’s a status symbol. People will talk about who their PT is more so than perhaps the handbag they're carrying."
The key to breaking this market? Word-of-mouth and expert endorsement. "We don't find traction with the traditional beauty influencer," explained LYMA Founder Lucy Goff. "We find a lot of traction through authentic storytelling in the professional setting. It might be a surgeon, it might be an aesthetician, it might be a dermatologist, but it's within that professional credibility that we find the most authentic reach."
In the US, DEI and ESG initiatives have been deprioritised. While Yeomans believes this may seep into British luxury in the form of ‘green hushers’ – companies who act on sustainability and diversity without publicising it – he is of the firm opinion that the luxury consumer expects these values to come as standard. "Your customers see sustainability as ‘baked in’," he explained. "They may not necessarily ask for it – they may just assume that your sustainable credentials are part and parcel of the price."
For Mulberry’s new CEO, Andrea Baldo, sustainability initiatives could become the very raison d’être for the brand. “Today, what we call the ‘green’ part of the business represents 1% of sales, but it’s growing," he said. "How to make that profitable is the thing – and that's why the brand needs to own the entire length of production. We are really investing in that part of our operation so that, in the next five years, it’s up to 10% of the business and profitable."
Whether talked about or not, it is clear there is still work to do particularly when it comes to DEI. A number of speakers pointed to the disparity between the leadership of luxury brands and their customers, advising that building diverse teams is both a societal and economic growth imperative. As Penhaligon's Koeppen observed, “Progress can only come when you have diversity of opinion, diverse teams in general, and you challenge each other – and everyone's happy to be challenged.”
Another recurring theme which speakers touched on throughout the Summit was the industry-wide rise in prices post-pandemic and the cooling effect this is now having on the market – a phenomenon that Rambourg called ‘greedflation’. Bain & Company’s Global Outlook for Luxury report found that more than 50% of luxury consumers are put off spending by price increases.
The answer, said Steiner, is to back up your prices with value: “Luxury is about delivering customers an enhanced experience across the whole journey, when shopping, within the product, through storytelling; but the price-value equation should hold true even within luxury, and today the equation is unbalanced toward price.”
This idea is something Sabyasachi says also resonates strongly with luxury shoppers in India, explaining, "It’s a misnomer that people in India shop cheap. That's absolutely untrue. People in India shop value: as long as long as your brand can show value to the Indian customer, you can keep on extending and stretching their wallets infinitely."
Meanwhile, for British artist and designer Yinka Ilori, it’s about expanding your definition of luxury to think about what it means in terms of emotion and individual perception. Speaking about his 2023 tote bag collaboration with M&S, which many collectors saw as devaluing his work, he said, “When I started my practice all I cared about was accessibility; I want to make my work available to everyone. To someone in M&S buying their vests, that’s £15 of luxury – that bag is gold. It's about trying to cater for different people who probably don't feel they can go into the RA or the Tate, but they can buy this bag as a collectible.”
The importance of immersive experiences and the new frontiers in multi-sensory branding was a topic covered across the day. As Penhaligon’s Koeppen succinctly put it, “Brand is everything because it means you don't just sell a product, you sell a dream, you sell an identity, you sell statements which consumers can lean into.” What this looks like for Penhaligon’s now is an immersive storytelling pop-up exhibition, Eau So British, which has just arrived in London having made its debut in Shanghai.
The way you create the world of your brand should be thought about at every moment, and in every way - ultimately it’s about how you make your customers and guests feel.
"Everything we do when we create a fragrance starts from a story," explains Catherine Sykes, VP of Product Development at Jo Malone London. "Whether that story is audible, whether that story is visual, if you have that stimuli at the same time as scent, you'll have a much deeper connection to that product or to that experience."
Collaboration can also be a brilliant opportunity to create memorable experiences while opening up your brand to both new audiences and new realms of creativity. "After Covid, a lots of brands want joy; that's the brief," says Ilori. “I've been creating joy since I started in 2009 because my parents always celebrated joy through food, music, and culture. What I'm seeing now is brands giving creative control to artists and letting them tell a story about how they can bring joy."
This ethos was perfectly showcased in an immersive audio project between Defender and sound studio Father, which helped bring the power of the marque’s Okta model to life pre-launch. “I think there’s a recognition that sound has this ability to build those genuine, emotive relationships with audiences and [create] that level of immersion in the customers that they look to,” said Freddie Denham Webb, Co-Founder and Creative Director of Father.
According to Banta, customisation is no longer merely "about monogramming". "What luxury really means to UHNWs in their words, is rarity, superiority and privilege," she added. "The part that they value most is being considered individuals."
While this could be something as small as making sure a VIC’s favourite beverage is on offer in your boutiques or offering tickets to a sold-out concert for their favourite artist, data is key to ensuring you're offering the right experiences to the right people.
"We are very focused on emotive, evocative, connective experiences with our guests," said Rebecca Burdess, Global Head of Guest Experience and Services at Maybourne. "How are we constantly exceeding what we know they want but also helping them discover new things based on their areas of interest? Data powers us with information, but how are we then utilising that information to create environments, experiences, relationships with our customers?"
Be diligent about collecting the right types of data through your VIC programmes and AI can be a powerful tool for identifying trends in, not just spending habits, but personal interests too. "New uses of AI can really develop our understanding of customer preferences and provide highly curated suggestions, replicating the personal touch of an in-house consultant,” said WIRED’s Greg Williams. "There's also a lot of research to suggest that personalised AI enhances customer engagement and drives higher conversion rates."
Speakers throughout the day emphasised the qualities of British luxury as a key opportunity for success. Whether it be craftsmanship, heritage, the innovation, or humour, everyone agreed that there is nothing quite so exciting as the vibrance of British creatives. British Vogue’s Chioma Nnadi explained: “[Having been] being a Brit abroad for 20 years, and then coming back to the UK, I appreciate the things that make British culture and style so distinctive. I love the spirit of how scrappy the London creative scene is. When I think about some of the most important creative directors of the last 20 years, many of them went to Central Saint Martins, and to be at the heart of that scene is really exciting."
Dr Nicholas Cullinan, Director of the British Museum – and also a Brit who spent many years in the United States – concurred: “Personally, I think it means I see things more objectively and have more frames of reference. How can we celebrate this really inclusive, dynamic idea of Britain? It isn’t jingoistic or nationalistic, it's inclusive and there's a sense of pride in that."
"The beauty about British luxury brands is that we are not precious," said Penhaligon’s Koeppen during her interview. “We are luxury, but with charm. We can be quite playful, we can be a bit rebellious and, given we are not precious, it makes us more approachable."
Of course, the best way to experience this spirit of Britishness is on home turf which, says Mulberry’s Andrea Baldo, makes the issue of tax-free shopping more prescient than ever. “When buyers go to London, they want to buy British brands, they want that luxury experience. All we want is to have the same advantages as other companies. You want to have British manufacturing and craft but this is actually not allowing us to compete. [Tax-free shopping] would definitely unleash a lot of value. It’s about marketing it in a way that is not about giving things away for free but celebrating our customers.”
Thank you to our event supporters: Agility Research & Strategy, The Londoner, Moneypenny, London Packaging Week, The Times, Focus Productions, McQueen's Flowers, Mother Root and Silent Pool.
