A survey of more than 2,000 luxury clients across the United States and China reveals that emotional connection now sits at the top of brand desirability in both markets — but how that desire is expressed, and what sits alongside it, differs significantly between the world’s two most important luxury markets. That is the central finding of ‘The State of Fashion: Face to Face With Luxury Clients’, a new research report from McKinsey & Company and BoF Insights, The Business of Fashion‘s data and advisory team, released today.
In the US, emotional connection has risen alongside self-expression and personal identity, while status signalling and logo recognition have receded as motivating forces. In China, the picture is more layered: emotional connection has emerged as the leading driver of brand desirability, but recognition and social confidence remain important — reflecting the continued role of luxury as a vehicle for social validation in the Chinese market.
The report draws on a survey of more than 2,000 luxury clients across spending tiers in the US and China, combined with in-depth qualitative interviews with customers ranging from aspirational to ultra-high-net-worth individuals, and executive interviews at Chanel, Jessica McCormack, Urban Jürgensen and ICICLE. It offers the most detailed account yet of what luxury clients in these two markets actually want — and how a fundamental shift in their priorities is reshaping the path to growth for brands across the sector.
The luxury industry is slowly emerging from a prolonged downturn, with overall market growth expected to reach between 4 and 6 percent per year through 2030. The US — the world’s largest single luxury market at around $130 billion — is forecast to grow at up to 5 percent annually, while China’s $60 billion high-end market is expected to recover and expand at up to 6 percent per year.
But reigniting that growth will not come easily. The aspirational and established client segments — those spending between $5,000 and $50,000 on luxury goods each year — represent around $70 to $90 billion in potential growth, yet have been systematically underserved as brands directed attention toward clients most immune to economic headwinds.
Self-expression outranks status
Clients are increasingly motivated to make a purchase by how a brand makes them feel rather than what it signals to others. In both the US and China, emotional connection ranks as the top driver of brand desirability, ahead of craftsmanship, heritage and logo recognition. But there is also much that sets the two markets apart.
In the US, brand desire is rooted in self-reward and personal identity, fuelling momentum for challenger brands: 68% of US consumers say smaller, independent labels reflect who they are, more than those citing legacy houses.
In China, brand desire is more closely tied to visibility, recognition and the shopping experience itself, with legacy brands, both global and homegrown, continuing to carry greater emotional weight. For example, 33% of established luxury clients say they shop to feel more confident. For occasional and aspirational luxury clients, this number jumps to 47%.
From restricting access to rewarding loyalty
Luxury clients are growing sceptical of artificial scarcity, increasingly viewing waitlists and limited availability as sales tactics rather than a marker of genuine value. Luxury clients are more interested in aligning themselves with insider communities, opening up a window of opportunity for smaller, challenger brands to tap into this demand to gain market share from more visible legacy houses.
In the US, around 40% of clients say early product drops, limited editions and loyalty rewards generate a sense of exclusivity. Meanwhile, in China, bespoke and personalised service ranks as the number one driver of exclusivity and is particularly important for Gen X customers, who hold significant spending power.
Luxury clients are choosing moments over material things
Luxury value is increasingly measured in access, moments and memories rather than ownership of goods alone. Around 30% of clients in both markets say they would prioritise travel above all if given additional money to spend, making it the single biggest beneficiary of rising discretionary income across client tiers. In the US, clients gravitate toward wellness and cultural experiences, with 45% citing wellness-related activities as a top interest.
In China, the physical store remains the number one source of shopping inspiration across all client tiers, as stores evolve from transactional environments to immersive experiences. By contrast, poor in-store experiences, including pushy sales tactics or long queues, are major pain points for US shoppers.
AI and resale increasingly mediate luxury brand engagement
Luxury relationships increasingly begin outside of brands’ control, the report finds. As many as 46% of established luxury clients in the US and China use AI for luxury shopping inspiration and discovery.
Across both markets, more than half (54%) of luxury clients who use AI to shop luxury use it to evaluate brands, with use highest in sophisticated categories like watches (57%).
Resale is similarly becoming part of the brand journey as it moves beyond its role as a discount channel. As much as 59% of higher-spending established luxury clients in the US regularly buy pre-owned luxury — challenging the assumption that resale purchases are primarily driven by budget considerations. Around half of US clients cite the “thrill of the hunt” as the primary reason for shopping resale. In China’s less mature resale market, trust in authenticity is most important.
Imran Amed, Founder, CEO and Editor-in-Chief of The Business of Fashion, said: “Since 2020, the luxury industry has raised prices, tightened distribution and focused its attention on top-spending clients. But industry growth in the coming years will come from engaging with customers further down the hierarchy who have stopped trusting luxury to deliver something genuinely meaningful. This report is a reminder that brand desirability cannot be manufactured through price or scarcity, but has to be earned, market by market, client by client by building emotional connections with clients.”
Gemma D’Auria, Senior Partner and Global Leader of McKinsey’s Apparel, Fashion and Luxury sector, said: “Luxury clients are looking for inspiration and connection, creating a powerful opportunity for brands to deepen engagement with the aspirational consumer and drive growth across spending tiers. While the desire for meaningful brand relationships is universal, how clients engage with luxury differs across markets. The brands that deliver a distinctive experience at every touchpoint will be best positioned to succeed.”
The State of Fashion: Face to Face With Luxury Clients is the latest report from BoF Insights and McKinsey & Company. Insights are based on a survey of more than 2,000 luxury clients across spending tiers in the US and China, combined with in-depth qualitative interviews with customers ranging from aspirational to ultra-high-net-worth individuals. The report also includes in-depth interviews with leaders including Bruno Pavlovsky, president of Chanel’s fashion division; Leonie Brantberg, chief executive of Jessica McCormack; Alex Rosenfield, chief executive of Urban Jürgensen; and Louise Xu, executive president of Shanghai-based label ICICLE, as well as industry analysts and experts at McKinsey and BoF.
