What: Saks Global's latest Luxury Pulse survey reveals significant decline in consumer optimism, with only 47% planning to maintain or increase luxury spending in the next quarter.

Why it is important: The findings reflect a fundamental transformation in luxury retail, as highlighted in recent Bain & Company reports showing the first contraction in personal luxury goods in 15 years, requiring retailers to rethink their engagement strategies.

Saks Global's latest Luxury Pulse survey unveils a marked decline in luxury consumer confidence, with economic optimism falling 13 percentage points since January 2025. Only 28% of respondents express optimism about the economy, while the percentage feeling calm about economic conditions has dropped by 22 points year-over-year. Despite these concerns, 67% of high-income consumers earning $200,000 or more remain confident about their personal finances. The survey identifies key consumer worries, including the general social and political climate, potential recession, and personal financial security. In response, Saks is emphasising product longevity and value proposition, while enhancing personalisation efforts and focusing on special occasions. The company maintains that luxury consumers are typically "last in, first out" during economic challenges, suggesting potential resilience in the sector despite current headwinds.

IADS Notes: The luxury retail landscape has undergone significant transformation throughout 2024-2025. As reported in February 2025, Bain-Altagamma's study revealed the first contraction in personal luxury goods in 15 years, with the industry losing 50 million consumers over two years. This aligns with December 2024 data showing a broader shift in consumer behaviour, where even affluent shoppers are becoming more discerning in their purchases. The trend is further evidenced by January 2025 reports indicating that top customers now account for 45% of global purchases, up from 35% in 2021, demonstrating increasing market polarisation.

Saks Global report: Intent to spend on luxury softens