Global luxury market stabilises as industry enters ‘normalisation’

The US, Europe, and China remain key to stabilising global luxury.

The global luxury industry is entering a period of stabilisation rather than rapid growth or structural decline, according to Kearney’s 2026 Global Luxury Industry Outlook.

After a year marked by creative resets, pricing adjustments, and operational discipline, the market is poised to advance at a more measured pace.

Whilst some external forecasts anticipate growth of 3 to 5%, Kearney predicts a more tempered 2 to 4% increase in 2026, noting that gains will vary across regions, product categories, and consumer tiers.

The report noted that luxury is shifting to a holistic and transformational model, where value comes from products, experiences, services, and ecosystems together.

Leading brands are moving beyond single “moments” to creating experiences that reshape consumer perspectives, values, and emotional connections well beyond individual transactions.

Three regions—the United States, Europe, and China—remain key to stabilising global luxury. Japan and Southeast Asia show growth potential due to rising affluence and urban concentration. The Middle East faces uncertainty after recent conflicts, and brands should monitor sales trends closely.

Consumer spending is also becoming more concentrated and intentional. Ultra-high net worth (UHNW) and high net worth (HNW) individuals continue to drive most of the market, whilst aspirational consumers are engaging differently, focusing on categories such as jewelry and experiences.

With continued price increases expected, brands may face loyalty risks beyond their top-spending clientele as consumers reallocate discretionary spend.

Price increases may challenge brand loyalty outside top-spending clientele.

Technology is reshaping competition. AI is moving from experimentation to core infrastructure, influencing design, forecasting, clienteling, and service. Agentic AI and commerce in 2026 will change how consumers discover and buy, with trust and data clarity becoming key to visibility.

Creative resets are also reshaping the industry. Surges in changes among creative directors indicate luxury houses are actively reinvigorating brands and products.

Overall, 2026 will reward brands that earn relevance across products, experiences, and ecosystems, rather than relying on scale alone.