How top luxury brands win (or lose) ultra-wealthy clients

The luxury market is at a crossroads. While brands like Hermès celebrate one record high after another, others, like Gucci, are in free fall. It’s easy to blame the market when things are bad, but it’s much more critical to examine what really makes a brand win or lose clients. For years, I’ve worked with luxury brands to help them transition to the next generation of wealthy clients. Some brands took Gen Z seriously and prepared early, while others continue to ignore the paradigm shift shaped by dramatically changing consumer expectations. It’s not just a digital world — it’s a social-media driven reality, where algorithms dictate which content is delivered to whom. Brands that don’t shift from a product-centric to a client-centric storytelling model will be wiped out. The billions of lost revenue, profitability, and market valuation that Kering has experienced by mismanaging Gucci in just two years show that nothing is as it was just a few years ago. To lead in this evolving landscape, brands must understand the psychological and emotional factors driving purchasing behavior while avoiding hidden pitfalls that can alienate even their most loyal clients. Given these drastic changes, I’ve reimagined my luxury MBA program at the Pepperdine Graziadio Business School to equip future leaders with the tools needed to navigate this complex landscape. Below is a preview of the key insights we’ll explore, offering managers a clear roadmap for what to prioritize. The emotional core of luxury consumption Luxury purchases are rarely about practicality. In fact, difficulty is often a driver of perceived value. On the back cover of my luxury management book, Luxury Marketing & Management, Pietro Beccari, the CEO of Louis Vuitton, wrote, “Luxury is pure emotion.” These four words say it all. Research shows that consumers experience a rush of emotions when buying luxury items: feelings of accomplishment, excitement, and anticipation. Luxury clients buy not just a product but the anticipation of a significant positive perception shift. Beyond functionality, luxury goods serve as symbols of identity and self-expression. Consumers align themselves with brands that reflect their personal values or desired self-image, using these purchases to tell a story about who they are. In the age of social media, this is compounded, yet many brands focus primarily on the product and neglect the human element. However, this emotional connection is a double-edged sword. When brands fail to meet expectations — whether through poor service, lack of authenticity, or misaligned messaging — they risk severing bonds entirely. Understanding what drives ultra-wealthy clients away is as important as understanding what draws them in. Empathy becomes critical here; brands that can anticipate and address customer needs on an emotional level will foster loyalty and build long-term relationships. The rise of resale One of the most significant shifts in the luxury landscape is the explosive growth of the resale market. Once considered taboo for high-end brands, resale has now become a cornerstone of the circular economy. By extending the lifespan of luxury goods and appealing to environmentally conscious consumers, it has evolved into a multi-billion-dollar industry, expected to surpass a third of the total luxury market by the end of the decade, according to Équité Research. This trend presents both opportunities and challenges for luxury brands. On one hand, resale offers a way to engage younger generations and reinforce sustainability commitments. On the other hand, it forces brands to rethink their value proposition. If a preloved item can offer nearly the same emotional value as a new one at a fraction of the price, how can brands justify their premium pricing? The answer lies in creating unique experiences — through storytelling, exclusivity, and exceptional services — that go beyond the product itself. Pricing strategies: The perception of value Luxury pricing is not just about setting high prices — this is where many brands fail. It’s about crafting an entire perception of value. This requires trust, which has become one of the most critical components in managing luxury today. In an industry where quality is a given, premium pricing requires trust, exclusivity, scarcity, and superior storytelling. However, this strategy requires careful calibration. A price point that feels unjustified or inconsistent with brand messaging can erode trust faster than ever before and drive customers away. A price point that feels unjustified or inconsistent with brand messaging can erode trust faster than ever before and drive customers away. Brands must consider how their pricing strategies align with their storytelling. Additionally, pricing plays a crucial role in shaping customer expectations: it sets the tone for the level of service, quality, and attention clients anticipate. Missteps here will have long-term repercussions on brand perception. Avoiding hidden pitfalls in luxury sales Despite their best efforts, many luxury brands fall into traps that alienate customers. One common mistake is underestimating the importance of personalization. Today’s clients expect tailored experiences that make them feel valued as individuals. Generic interactions or cookie-cutter approaches can quickly lead to dissatisfaction. Another pitfall lies in overemphasizing exclusivity at the expense of accessibility. While scarcity is a hallmark of luxury, it must be balanced with inclusivity in customer service. A dismissive attitude or lack of empathy from sales staff can turn potential clients away permanently. Finally, brands must carefully navigate the tension between tradition and innovation. While heritage remains a pillar of luxury branding, an unwillingness to adapt to modern trends — such as digital integration or sustainability — can make even iconic brands feel outdated. Building lasting customer relationships At its core, winning in luxury is about building relationships that stand the test of time. This requires more than just delivering exceptional products; it demands an understanding of what truly matters to clients, both rationally and emotionally. Empathy plays a pivotal role here, allowing brands to anticipate needs, resolve pain points proactively, and create moments that resonate deeply with customers. Frameworks for fostering loyalty include consistent storytelling across all touchpoints, leveraging data to personalize experiences at scale, and investing in training programs that empower frontline staff to embody brand values authentically. Moreover, brands must continuously innovate while staying true to their core identity, a delicate balance that requires strategic foresight. For future luxury leaders With the redesign of my MBA program at Pepperdine, my goal is to equip students with the most crucial strategies for managing the luxury brands of tomorrow. It’s important to me that they gain exposure to cutting-edge insights into luxury strategy, including proprietary research on high-net-worth individuals and case studies from leading brands. I’m particularly excited about the guest speakers — from luxury CEOs to creative directors — whose insights I regularly share with a broader audience on my Future of Luxury podcast. The evolving luxury landscape demands agility, empathy, and an unwavering commitment to excellence. Brands that understand these principles will lead the charge. Whether you’re at the helm of a global fashion house, a hotel, a jewelry brand, or launching your own luxury venture, mastering these strategies will be essential for long-term success. The stakes have never been higher: win your clients’ hearts or risk losing them forever. 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. Follow him: LinkedIn and Instagram. Listen to his Future of Luxury podcast.

How top luxury brands win (or lose) ultra-wealthy clients

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Published March 03, 2025

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How top luxury brands win (or lose) ultra-wealthy clients