Why luxury brands struggle to scale AI

The luxury industry is deploying a wide range of AI experiments. These include virtual stylists, automated product tagging, clienteling apps, predictive tools, and content generators, just to name a few. However, many of these initiatives start with enthusiasm and end as small proof-of-concepts that never evolve into real transformation. This pattern has become so common that it raises a deeper question: Why does the industry struggle to scale AI beyond isolated pilots and create tangible client value, even when leadership teams publicly declare AI a strategic priority? In my work with luxury brands in the U.S., Europe, Asia, and the Middle East, I see a recurring issue: AI projects are often built around the technology itself. Scaling them into projects that deliver tangible value, however, requires a clear value-creation model. The dilemma? Luxury brands often implement tools without anchoring them in the fundamentals of luxury value creation. Without this foundation, AI projects remain disconnected from what clients expect and what the brand stands for. They may create efficiency, but they rarely create emotion. And emotion is the currency that drives luxury. Why AI projects stall This is where the concept of Added Luxury Value (ALV) becomes essential. ALV explains the psychological premium that clients feel when they interact with a brand. It is the foundation of desire, pricing power, and long-term loyalty. If AI is not aligned with ALV, scaling becomes impossible because the technology does not elevate the emotional core of the brand. At best, the pilot works as an isolated tool. At worst, it weakens the experience. One of the most common mistakes I observe is the belief that scaling AI is primarily an operational challenge. The assumption is that once a pilot works, the next steps are deployment, staff onboarding, and integrating it into workflows. But the real challenge is far more fundamental. Most projects and technologies are not designed with a clear emotional outcome. They optimize for convenience, accuracy, or speed — positive attributes, but ones that do not generate significant, ownable, or defendable luxury value. They often fail to build desire and rarely strengthen the brand’s cultural capital. Luxury clients do not reward brands for operational efficiency; they expect it. Rather, they reward brands for emotional relevance. If the pilot does not create emotional resonance, its impact will be marginal. And if it does not enhance ALV, there is no strategic argument for scaling it. Here’s another challenge: many AI projects are tested outside the real context of client interaction. They are assessed on functionality but not on the emotional effect they create. For example, a chatbot may respond quickly, but does it reflect the brand’s tone, cultural reference points, and emotional sophistication? A recommendation engine may increase conversion, but does it deepen the client’s sense of being understood? A client-centric view is needed to unlock success. Designing AI around ALV True value creation happens when a brand sees AI not as a tool but as a way to deliver its client promise more consistently. That requires clarity about the story and the experience the brand wants to create. It requires an ALV-driven design of every step of the interaction. It requires teams who understand how to translate emotional intelligence into digital interfaces. Without this foundation, AI remains a tactical experiment. The brands that succeed with AI share a different mindset. They start with a precise definition of their emotional value. They understand their cultural code. They know which feelings they want to evoke at what touchpoint. They build AI initiatives that reinforce these effects. They design pilots that replicate the brand’s most iconic service moments. They train their teams to use AI as an extension of empathy and human connection. These pilots scale easily because they strengthen what already works. They create consistency, not shortcuts. Enhancing, not replacing, human care There is an additional dimension that is becoming increasingly important. Younger luxury clients expect AI to be invisible. They do not want to feel that technology is replacing human care. They expect AI to enhance relevance and personalization behind the scenes. When AI becomes too visible, it risks making luxury feel robotic and generic. When it becomes too transactional, it erodes trust. Scaling requires the subtlety of making AI feel like intuition, not automation. I can already see in our studies at Équité Research that Gen Alpha, the first AI-native generation, is particularly allergic to the inauthenticity of many solutions available today. This is why scaling AI in luxury is not just a technological challenge but a fundamental value challenge. Brands must define how AI will elevate their emotional promise. They must design projects that reflect their brand essence. They must measure success not by efficiency metrics but by emotional response, narrative strength, and perceived differentiation. If luxury brands want AI to move beyond the pilot stage and create real-world impact, they need to treat it as part of their extreme value creation strategy. When ALV guides the process, pilots stop being isolated experiments and become building blocks of a more meaningful brand experience. Are you ready? This is an opinion piece by Daniel Langer, CEO of Équité, recognized as one of the “Global Top Five Luxury Key Opinion Leaders,” and advisor to some of the most iconic luxury brands in the world. He serves as an executive professor of luxury strategy and pricing at Pepperdine University in Malibu and as a professor of luxury at NYU, New York. Daniel has authored best-selling books on luxury management in English and Chinese, and is a respected global keynote speaker. Daniel conducts in-person masterclasses on various luxury topics across the world. As a luxury expert featured on Bloomberg TV, Forbes, The Economist, and others, Daniel holds an MBA and a Ph.D. in luxury management and has received education from Harvard Business School. Sign up for his online luxury masterclasses at the Jing Academy.

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Why luxury brands struggle to scale AI