What: With outlets and online discounters set to grow five times faster than full-price channels, luxury brands are hoping to tap the momentum in off-price.

Why is it important: Outlets and dedicated discount retailers are gaining share as brands clamp down on both wholesale and end-of-season markdowns. Off-price sales are expected to grow five times faster than full-price from 2025 to 2030.

There’s no sure way to predict which items will sell and in what volumes each season, nor how to price them, and the need to regularly animate stores with new products means finding ways to clear unsold stock. As luxury brands have pushed their prices skyward, it’s become increasingly out of sync with their exclusive image to be seen selling their wares at a discount, whether in their own boutiques or online.

Fast-growing German e-tailer BestSecret contends its members-only marketplace will allow brands to discount online without harming their brand image. Whereas most off-price players have historically depended on the leftovers of wholesalers for the bulk of their inventory, BestSecret sources 95% of products directly from brands.

Brands need to learn to leverage both online and offline off-price opportunities, understanding the pros and cons of each one. Luxury brands mostly remain committed to traditional, physical channels for discounting including physical outlets or friends-and-family sale events. But as they sell more online, they could need more ways to discount online, too while hoping to reduce their exposure to brand-damaging public markdowns.

Brands have started testing the waters of sites like BestSecret and luxury flash sale site The Bradery. LVMH recently invested in the mystery-box off-price start-up Heat, which spreads markdowns across multiple items in bundled deals to obscure steep discounts.

The future of luxury discounting