Luxury distribution shifts toward value in 2025 with outlets leading

Outlets again outperformed, growing about 1% to 3%, whilst the secondhand luxury market expanded to about €50b.

Luxury distribution in 2025 continued to shift toward value, with outlets outperforming full-price retail and markdown pressure rising across channels, according to Bain & Company and Fondazione Altagamma, the trade association of Italian luxury goods manufacturers.

Discounted sales made up about 35%–40% of industry revenues, around five percentage points higher than in 2015, whilst inventory levels as a share of revenues were 3–4 percentage points above 2019 levels.

Monobrand store sales declined 2% to 0%, as brands pulled back on physical expansion. About 25,000 sq m of monobrand space has been closed since January, and store openings in the first 11 months of 2025 were 15%–20% lower than in 2022.

Average flagship sizes, however, rose by more than 30%, reflecting a shift toward fewer but larger stores and a need for more localised, personalised formats.

Online sales stabilised at -1% to +1% growth, lifting online’s share of the market from 20% to 21%. Brand-operated sites improved, aided by AI-enhanced experiences, whilst multibrand platforms remained under pressure.

Offline multibrand retail underperformed, leaning more on discounts; US department stores cut selling space by about 10% since 2024.

Outlets again outperformed, growing about 1% to 3%, whilst the secondhand luxury market expanded to about €50b, up by around 4% to 6%.

Overall, the channel mix continued to shift, with wholesale’s share falling from 60% in 2019 to 46% in 2025, and retail rising from 40% to 54%.