From Prada’s Momentum to Hermès’ Resilience: Luxury Brands Navigate the Shifting Market in 2024
As 2025 approaches, fashion finds itself at a pivotal moment. The year ahead promises to be the beginning of a ‘heavy lift’ for growth in the luxury sector—undoubtedly accompanied by the media’s inevitable hook of “luxury fatigue” (Note to media: please, let’s skip that headline and not compound the issue).
The growth strategies of tomorrow won’t mirror those of yesterday. Door expansions and relentless price hikes no longer cut it. Instead, brands will need to streamline (yes, we said it) and, most importantly, take risks. The Impression encourages leaders to resist the urge to slash marketing budgets—a tempting but shortsighted move during challenging times. Marketing will be a crucial lever for success, especially as the industry refines its DNA for a new era.
In reflection, 2024 has been the least impressive year for creative narrative we’ve witnessed since our inception. Perhaps due to budget cuts and more focus on events. Whatever the reasoning, it’s perplexing: the digital era provides brands with direct and unprecedented reach, yet lookbooks masquerading as campaigns have become the norm. Brands must rediscover the courage to tell bold, 360º stories. Risk in creativity has always proven its worth, delivering outsized rewards when the clouds clear. The message here is simple: let’s embrace that growth with conviction.
The Numbers Don’t Lie
This year has been particularly notable for declines at LVMH, the world’s largest luxury stock. Once Europe’s most valuable listed company, LVMH was dethroned by drugmaker Novo Nordisk A/S in mid-2023. Its shares fell 19% in 2024—their worst annual performance since the 2008 financial crisis—bringing valuation multiples below the average of the past six years. Kering’s stock took an even steeper dive, down 40%, while brands like Salvatore Ferragamo and Hugo Boss face uphill battles to stage meaningful turnarounds.
The year has also been marked by standout performances from Prada, Ralph Lauren, and Hermès, defying the broader turbulence in the luxury market. Prada posted a strong 40.02% increase in stock performance, powered by a revitalized focus on youthful, contemporary appeal through Miu Miu, whose creative direction and commercial strategy have gained significant traction globally. And the mainstay house of Prada hasn’t done too bad either. Ralph Lauren surged by an impressive 58.3%, buoyed by robust demand in North America and Europe and strategic execution in direct-to-consumer sales. Meanwhile, Hermès maintained steady growth with an 11.74% increase. These houses have demonstrated that a focus on heritage, innovation, and customer-centric strategies can deliver strong results even in challenging economic climates.
The hope for a luxury rebound now rests on signs of recovery in the U.S. as a new administration takes office. Optimism around the president-elect has temporarily buoyed markets, but risks loom large. Last week’s interest rate cut failed to satisfy investors, triggering sharp declines across U.S. markets. Meanwhile, fears of a revived trade war and sluggish consumer sentiment in China—where economic malaise and rising prices have cooled the appetite for high-end goods—signal turbulence ahead.
With consumers increasingly scrutinizing the value-for-money equation, a full recovery may take time, leaving 2025 as a transitional year for much of the luxury sector.
Long-Term Vision Over Short-Term Gains
It’s easy to feel pessimistic about short-term signals, but we urge a broader perspective. Quarterly earnings often obscure the long-term value brands can deliver. Change takes time. After all, it can take 24 months just to roll out a new logo, let alone reposition a brand for growth.
Periods like these are essential for reflection and refinement—an opportunity for brands to revisit their DNA, make necessary but difficult choices, and ultimately return to the market with their clearest value propositions and boldest/impactful marketing campaigns. If history is any guide, this process will pave the way for stronger, more resonant growth.
The Impression stands ready to inspire, inform, and support our industry through the ups, the downs, and everything in between. To the entire luxury community: here’s to a year of practical health and long-term success. Stay focused, get bold, and lead the way—we’ve got your back.
Warm Regards,
Kenneth Richard
Chief Impressionist
The Impression
