How accessory brands can add the finishing touch to their business

Luxury stands in a difficult position, facing perhaps its most nuanced challenge in a long time. On the one hand, maintaining revenue from older affluent consumers is critical in the short term, but on the other, younger shoppers aren’t bought into what they have to offer.

It’s not simply about choosing between generations – it’s about striking a delicate balance that serves both effectively while preserving brand integrity.

Luxury’s demographic conundrum

Over recent years, luxury brands have increasingly struggled to connect with younger shoppers.

Traditional status symbols no longer resonate with a generation seeking deeper brand connections.

Instead, they seek authenticity, community and emotional connections with their values.

The lack of desire from Millennials and Gen Z, paired with economic difficulties, has caused the luxury market to slowdown, with the overall customer base having shrunk by approximately 50 million people over the last two years.

While the shrinking customer base poses significant challenges, luxury is fortunately buoyed by its top customers and the Silver Generation, providing some level of stability for now.

This will suffice for the short term but realistically, luxury brands must find ways to engage younger cohorts and fast.

Bain & Co projected that by 2030, Millennials and Gen Z will account for roughly 70% of global luxury spending – meaning the Silver Generation can only prop the industry up for so long.

Younger shoppers aren’t just done with heritage brands, they seem less and less inclined to engage with luxury as a whole, instead favouring growing fashion niches like activewear and sportswear.

The traditional playbook doesn’t necessarily need ripping up – that would only serve to push away the Silver Generation – but it does need reworking to tap into an overwhelmingly influential market.

Heritage still matters to the Silver Generation

While at first glance, it may seem wise to double down on attracting Millennials and Gen Z, the reality isn’t so clear-cut.

McKinsey’s data shows that over-50s will drive significant spending growth in fashion in the EU (79%), the US (60%) and China (60%) this year.

More importantly, the Silver Generation holds substantial wealth. In the US, those aged 55 or older account for 72% of national wealth. The story is similar in the UK; individuals in their 60s possess nearly nine times the wealth of those in their early 30s.

If luxury is to battle on in the short term, it’s crucial that it can attract the over-50s market which, in theory, is considerably easier than attracting Millennials and Gen Z.

The relationship between luxury brands and their older consumers is much deeper than the transaction.

These customers have grown up with traditional luxury values, where craftsmanship, heritage, and personal service reign supreme.

Their understanding of luxury was forged in an era when digital presence meant nothing and brand heritage meant everything.

Gucci’s latest “Endless Narratives” window concept embodies this dynamic perfectly.

While incorporating technology, the initiative’s crux is celebrating Gucci’s heritage.

Through curated displays of archival pieces and collaboration with established Italian artist Luca Pignatelli, Gucci shows a genuine understanding of what has always worked for its older customer base. It’s a continuation of tradition rather than a disruption.

The future luxury customer wants something different

While continuing to serve older consumers, luxury brands must simultaneously cultivate younger audiences who view the industry through a different lens.

They want authenticity and connections on their own terms.

As the first full-fledged digital native generation, engaging with Gen Z online via platforms and partners that resonate with them is imperative.

It’s about being where they are and spending time with them.

Several years ago, for example, Louis Vuitton ventured into the gaming world with a League of Legends collaboration that generated significant attention.

The gaming sphere is just one segment of the Gen Z market, though.

In 2023, Gucci recognised the decline in trust with traditional influencers and collaborated with Amelia Dimoldenberg to tap into the market of Gen Z consumers who valued personalities who they found authentic.

Other luxury brands have explored resale and second-hand platforms to engage shoppers who value the circular economy.

Platforms like TheRealReal and Vestiaire Collective have broken down traditional stereotypes about preloved clothing and made it fashionable to shop second-hand.

Newer brands like Represent that attract consumers through brand storytelling, in this case via the brand’s 247 product line, have recently launched resale options to cater to the growing number of eco-friendly shoppers.

The key to all these initiatives is to create new narratives that coexist with traditional luxury storytelling to avoid alienating any demographic.

By leveraging tech, new storytelling mediums and authentic influencers, luxury brands can engage and nurture the young consumer today to ensure longevity in the long term.

Using technology to bridge the generational divide

The most forward-thinking luxury brands are tactfully deploying technology to serve as a bridge between generations rather than a dividing force.

New digital experiences can be leveraged to attract young shoppers in the first instance while also enhancing the traditional experience to elevate it for the Silver Generation.

Virtual try-ons backed by human expertise, digital platforms that personalise shopping relationships, and interactive heritage storytelling all combine to add value to the classic luxury journey without replacing the core elements that appeal to older consumers.

On the flip side, these technologies allow younger shoppers to engage in a fundamentally different way.

AR experiences, gaming collaborations, and digital-first collections serve as the ‘new’ luxury experience that meets their expectations on their own terms.

The successful application of these technologies requires brands to really understand both ends of the market and ensure they are deployed on the appropriate channels.

It’s important to note there will be overlap too.

McKinsey’s The State of Fashion 2025 revealed that aspirational and younger consumers also value human interactions. They are reportedly up to twice as likely to seek staff styling advice than value-market shoppers.

This is where agentic AI will play a crucial role. The tech is helping luxury fashion retailers support their store staff to enhance the in-person shopping experience.

The same McKinsey report noted that Kering’s Luce app boosted average order values by 15-20% by enabling more informed customer interactions. This not only improves the experience for the consumer but directly helps drive more sales for the brand.

Other examples include RFID and robotics for inventory tasks – freeing up staff time for customers – and AI-powered training platforms to upskill employees and make them more effective.

Dior notably improved staff retention by 10% by launching a performance-based rewards platform offering luxury experiences.

Not only does this reduce staff churn, which itself is incredibly costly, but it also leads to happier employees who will perform better and deliver greater experiences.

Luxury has a dual imperative to fulfil

The only real question left for luxury brands to answer is how they will evolve to meet the expectations of both older and younger consumers.

It isn’t a case of one or the other; it’s a dual imperative.

As frustrating as it may sound, there is no singular answer to the question.

It will entirely depend on what each brand stands for and how best they adapt their values to align with their target markets.

What works for a Gucci won’t work for a Represent.

Brands who successfully navigate this generational balancing act won’t just survive post-Silver Spenders, they’ll define luxury’s next chapter.

The future belongs to those who can honour heritage while embracing change and creating experiences that resonate across generations while remaining true to their values.

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