Luxury’s old playbook of exclusive boutiques and elite mystique is being upended. A new generation of consumers, digitally native, socially conscious, and culturally diverse, is reshaping what exclusivity means. Heritage brands like Chanel, Gucci, and Hermès face a stark choice: reinvent or risk irrelevance. The future of luxury will be defined by how well these brands marry their storied heritage with immersive digital-first experiences, all while embracing sustainability and inclusivity as new pillars of exclusivity.
Luxury’s traditional allure has always been built on heritage, craftsmanship and scarcity. But Gen Z and young millennials are questioning the script. Unlike the millennial “hypebeast” era that fueled luxury growth through sneaker drops and logo mania, today’s young consumers are interrogating value and values. They research product materials and ethics and won’t shell out for a nameplate alone. This skepticism is both financial and philosophical which is a direct challenge to brands that have dined out on heritage gloss.
Young luxury customers have grown up with resale and vintage as part of their shopping DNA. If a new $5,000 bag’s quality or story doesn’t convince them, they’ll hunt down a one-of-a-kind vintage piece or a preloved version on a resale site instead. In fact, many Gen Z fashionistas meet luxury first through the secondhand market, not the marble-floored flagship store. This is forcing brands to rethink their stance on resale. Once taboo, secondhand is now strategic: Gucci, Burberry and Stella McCartney have all partnered with resale platforms to participate in the booming secondary market. Luxury resale platforms are reporting record growth.
Gen Z is not tuning out of luxury; they’re demanding a new kind of luxury. They crave authenticity and cultural relevance in addition to heritage. Luxury brands need to explain why luxury costs what it costs, beyond craftsmanship and heritage. Luxury brands now also have to play into the cultural interests of their target customers and what they’re passionate about. Simply put, storytelling must go beyond the tired tales of founders and ateliers; it must connect with contemporary values, subcultures, and communities. Gucci’s answer, for example, was to dive headlong into streetwear and pop culture under Alessandro Michele, collaborating on projects from virtual sneakers to meme-worthy campaigns. The gamble paid off: new young customers flocked to Gucci. Crucially, unlike past generations who rebelled against their parents’ brands, Gen Z often covets the same luxury brands their elders loved, they’re just waiting for those brands to speak their language. Indeed, Bain & Company estimates Gen Z will account for about one-third of luxury purchases by 2030.
The takeaway is clear: the brands that successfully reimagine their heritage for younger consumers are poised to lead luxury’s next boom. Those that cling too tightly to old status symbols risk seeing a generation drift away. The paradigm is shifting from exclusivity to inclusivity, from status and ownership to emotions and values, which is a radical redefinition of luxury’s core appeal. Heritage alone is no longer enough; it must be heritage with hustle, blending tradition with modern relevance.
Perhaps the most profound shift in luxury is this: exclusivity itself is being redefined. Traditional luxury thrived on exclusion, the sense that not everyone can attain it, whether due to price, rarity, or elite image to name a few. But in an era of climate crisis and social awakening, the notion of exclusivity is being challenged by calls for sustainability and inclusivity. Far from killing the dream, these forces are reshaping what high-end consumers consider truly luxurious. The old markers of status (a logo, a price tag, an air of untouchability) are now joined by markers of values and ethics.
Today’s affluent buyers are increasingly not okay with a $10,000 handbag that exacts a hidden human or environmental toll. In a recent Vogue Business Index survey, nearly 25% of luxury consumers said a brand’s environmental policies were a mandatory factor in their purchase, the highest percentage to date and double the figure from just earlier that year. An equal share said the same about a brand’s commitment to diversity and inclusion. With heightened interest comes heightened scrutiny: companies caught polluting or discriminating face public wrath and even boycotts in the age of social media. Luxury shoppers, especially younger ones, care about what’s behind the curtain, from carbon footprints to how craftspeople and store employees are treated. Sustainability is no longer a “nice-to-have” branding exercise; it’s a make-or-break expectation.
Luxury brands have begun to respond in ways that would have been unthinkable a generation ago. After being excoriated for the practice of burning unsold goods to maintain scarcity, companies like Burberry publicly renounced the practice and pledged to find sustainable solutions for excess stock. Indeed, even during the pandemic’s inventory glut, no major luxury brand dared to destroy products to protect perceived scarcity. Brands are also investing in innovative materials, from lab-grown diamonds to mushroom-based leather, that promise lower environmental impact while maintaining quality. For example, Hermès has quietly worked with start-ups on alternative materials for its handbags, seeking to marry its craftsmanship with eco-innovation. And nearly 75% of luxury brands now have targets to cut carbon emissions or offset them, per industry reports, up significantly in just the past couple of years. Chanel, Prada, and Burberry have issued sustainability-linked bonds, tying their financing costs to hitting ESG targets as a sign of accountability.
Luxury’s embrace of sustainability isn’t purely altruistic; it aligns with the core of luxury’s value proposition: longevity and quality. The best luxury products were always about timeless appeal and durability (a well-made Swiss watch or Hermès Kelly can last generations). Now this enduring quality is being reframed as inherently sustainable: a counterpoint to fast fashion’s throwaway culture. Some luxury houses are encouraging customers to repair and care for products. For example, Hermès, Gucci and Prada offer repair services and circular fashion initiatives, while Stella McCartney (a pioneer in eco-luxury) put care labels on garments to help owners prolong their life.
The luxury sector is also cautiously embracing the circular economy through rental, refurbishment and resale. Gucci’s experimental “Vault” platform mixes new designs with carefully curated vintage pieces for purchase, signaling that selling secondhand Gucci by Gucci could become normalized. Today’s consumer might ask: Do I buy a new entry-level Coach bag, or a pre-owned Fendi baguette? Increasingly, status leans toward the latter. The allure of the truly iconic piece, even if pre-loved, trumps a shiny new item from a lower tier. Thus, ensuring their classics hold or increase in value on the resale market has become a hidden battleground for luxury brands.
Inclusivity is the other side of the value coin. Luxury brands have historically been accused of elitism, not just economically, but culturally. That’s changing fast. From the boardroom to ad campaigns, diversity and inclusion are top of mind. Representation of different ethnicities, body types, and genders in luxury marketing has improved markedly in recent years. For example, Balmain and Rihanna’s Fenty brand (under LVMH) set new standards by showcasing models of all skin tones and sizes in high fashion contexts. Gucci appointed its first diversity chief after past missteps, and today it regularly casts inclusive campaigns that resonate with global youth. True, these moves are as much about expanding the customer base as about social good, but they acknowledge that luxury can’t remain a closed club. In markets like India and Southeast Asia, inclusivity also means cultural localization and respect. Dior’s pre-fall 2023 show in Mumbai, for instance, celebrated Indian craftsmanship and featured local artisans’ work on a global stage, a savvy blend of cultural homage and brand storytelling that earned Dior massive goodwill (and press) in a key growth market. Such gestures recognize that aspiring luxury consumers in places like India want to see their identities and heritage valued, not just imported European ideals.
What does all this mean for exclusivity? Is inclusive luxury an oxymoron? The industry is still navigating that tension. If a brand becomes too accessible or loses its aura of specialness, it risks diluting its cachet. The art for luxury leaders is to maintain the dream, the sense of elevation, while opening the circle just enough. In practice, this means cultivating communities and experiences that feel exclusive, even as the brand’s values are inclusive. Think of exclusive membership programs that reward sustainable actions (e.g. special events for customers who buy vintage or carbon-neutral lines), or private client circles that are diverse and value-driven. Some brands are leveraging Web3 tokens as VIP passes to exclusive content or clubs, blending digital savviness with the age-old allure of belonging to an inner circle. The definition of a “luxury insider” is broadening from simply “rich and famous” to “aligned with the brand’s ethos and community.”
Importantly, embracing sustainability and inclusivity can enhance exclusivity in a modern way. A handbag made in a limited run with ethically sourced materials and zero-waste craftsmanship can be as exclusive as a traditional limited edition and with the added prestige of values. A luxury brand known for championing diversity or social impact can become more aspirational to young consumers than one known only for its $10,000 price tags. We are seeing the rise of what some call “expressive luxury,” built on self-expression and identity, rather than pure status display. In this model, the rarest luxury is a brand that allows you to feel true to yourself and your values while wearing it. It’s a profound shift: exclusivity through inclusivity.
The definition of luxury exclusivity is therefore moving away from “who can we keep out” to “who can we invite in”, selectively. It’s a pivot from being the aspiration of a few to an inspiration for many, without losing the cachet that makes it aspirational in the first place. The next generation of luxury buyers is telling us that luxury must earn its price, through enriched experience, impeccable ethics, and genuine connection, not just a famous logo.
The future of luxury will belong to those brands that can execute a delicate balancing act: preserve the magic but evolve the meaning. Luxury’s timeless fundamentals, quality, creativity, heritage, remain non-negotiable. But the way they are delivered and perceived is transforming. Business leaders in the sector must be as attuned to a Twitch stream as they are to a Paris runway. Investors will need to value intangible assets like brand community and digital innovation alongside quarterly same-store sales.
Juniu Jiang is an Assistant Professor of Marketing at ESSEC Business School
First Published: Oct 22, 2025, 16:58
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