New data reveals a significant downturn in luxury apparel and accessory spending in the first two months of 2025, signaling a potential shift in consumer behavior amidst economic pressures. A report from Consumer Edge indicates that overall apparel, accessories, and footwear spending in the US declined by 2 per cent in January and February, with the luxury sector experiencing a more drastic 7 per cent drop. This decline mirrors the 8 per cent decrease seen in the luxury market throughout 2024.
Notably, consumers are increasingly turning to budget-friendly alternatives. Fast fashion and consignment/thrift categories both witnessed a 5 per cent increase in spending compared to the same period last year. In contrast, department store spending saw a modest 2 per cent rise.
The report, based on transaction data from over 40 million credit and debit cards, highlights a notable struggle within the sports footwear and athletic apparel segment, where spending fell by 6 per cent. While newer brands like Alo Yoga, Vuori, and On Running showed strong performance, they were unable to offset the decline of traditional sportswear brands.
The luxury market’s turbulence is particularly evident in multi-brand platforms, which saw a 22 per cent decrease in spending. Single-brand luxury also experienced a 6 per cent decline, despite positive performance from mid-level brands like Coach and Ralph Lauren.
High-end brands such as Chanel and Christian Dior saw a continued pullback in consumer spending, potentially due to perceived excessive price hikes and a lack of innovative products. Among high-income shoppers, Louis Vuitton and Cartier increased their share, while Gucci experienced significant losses.
An age-based analysis of the data revealed that all age groups reduced spending on apparel, accessories, and footwear. The most significant decrease was observed among consumers aged 25 to 34, who cut back by 6.2 per cent over the past 12 months. Consumers aged 18 to 24 showed the smallest decrease, at 1.8 per cent. Older consumers, particularly those over 65, who possess greater disposable income, reduced their spending by 4.5 per cent. Other age groups showed decreases between 3.8 per cent and 5 per cent.
