By Mark Seavy 

Luxury brands are increasingly being challenged amid concerns about retaining brand prestige. This comes as the major fashion houses—from Prada and Fendi to Gucci and Oscar de la Renta—move to grow their audience via social media and expanded distribution.  

As a result, the consumer demand for uniqueness, which has fueled sales for decades, is coming up against a level of overexposure that can tarnish exclusivity. Because while scarcity and price were once enough to give an item a “special” feel, cultural meaning and being able to make consumers feel they are part of the process are now crucial elements of the brand equation. 

“With the amount of information that is thrown at you on the same platforms, between social media outlets and what people are receiving elsewhere, there is too much to digest,” a luxury goods executive said. “If that is the case, the information gets diluted, which, in turn, means the brand gets diluted. Brands need to be more authentic and purposeful with the product and storytelling.”  

How those stories are told varies from establishing in-store formats, launching pop-up locations, and maintaining social media connections with consumers. 

Prada, for example, opened cafes in New York and London, after starting with an in-store location at Harrods in 2023. Gucci has four Gucci Osteria restaurants (Florence, Italy; Beverly Hills, CA; Tokyo, Japan and Seoul, South Korea) inside flagship stores under a licensing agreement with Chef Massimo Bottura. And LVMH’s Louis Vuitton brand had planned to open a hotel in Paris this year but has since cancelled the project.

On a smaller scale, specialty retailer J.Crew Group opened a J.Crew Cashmere Candy Shop in New York in October that combined the brand’s well-known cashmere collection with free candy. 

“As a catalog brand, J.Crew is used to bringing the brand to life and social media helps with that, but sometimes physical locations are just as important,” a licensing executive said. “It is getting harder to stand out and focus on things that feel organic. And this was less about selling on social media and more about having fun and showing the lifestyle.” 

Yet regardless of the different strategies that brands are deploying to maintain connections with luxury shoppers, consumers in both the U.S. and China are defining exclusivity by how relevant, difficult to replicate, and recognized a product is rather than just by scarcity, according to the research firm McKinsey and the Business of Fashion’s The State of Fashion: Face to Face with Luxury Clients report.   

And, in the U.S., 45% of those surveyed said early access to products or limited editions are among the factors creating an air of exclusivity. Among higher income consumers, VIP programs are important to making them feel like privileged customers. 

“This is important because I am worried that pretty soon the consumer, with the way things are going, won’t know the difference between good and great,” a luxury goods executive said. “If the platforms and mediums remain the same, that information will become even cheaper and it will be harder to tell [luxury] stories.”