Luxury brands turn to AI to boost sales and customer engagement

They target the ultra-wealthy and aspirational middle-class consumers.

Luxury brands are becoming smarter with AI and advanced digital tools, using them to cut costs, improve efficiency, and strengthen resilience, according to KPMG's Luxury in the Midst of Change report.

The report said that brands are now using digital intelligence to understand and connect with consumers on a highly personal level.

They are targeting two key groups, namely the top two percent of ultra-wealthy clients who generate nearly 40% of revenue, and the 98% of aspirational middle-class consumers seeking status but mindful of cost.

The report highlights how artificial intelligence is enabling brands to craft hyper-personalised campaigns, blending online and offline sales, customer relationship management (CRM), and marketing under one intelligent system.

This allows messages, digital experiences, and product recommendations to be tailored for different segments, creating journeys that feel personal rather than automated.

A global luxury brand, for example, tailored content for a fragrance launch, raising social media engagement 45% and online sales 30%.

More than half of luxury brands now rely on digital personalisation for loyalty, with 22% reporting significant sales and engagement gains from AI.

Southeast Asia is leading this trend. Consumers are mobile-first, cashless, and digitally fluent, making them highly receptive to personalised, story-driven content. Brands that combine convenience with emotional engagement are winning loyalty.

Luxury leaders are increasingly using AI not just for efficiency, but to drive creativity, relevance, and customer loyalty, KPMG said.

In addition, brands are forming cultural partnerships across music, entertainment, design, and storytelling, co-creating experiences that resonate with consumers’ lifestyles and identities.

Looking ahead, the report predicts that collaborations with musicians, artists, chefs, and streaming platforms will become a key strategy, making luxury feel “lived” rather than displayed.

In Southeast Asia, brands that blend technology, emotion, and cultural relevance are setting a new standard for customer engagement and competitive advantage in the digital age.