Luxury market shifts focus from fashion to prestige beauty

The luxury goods market is undergoing a significant shift as consumer preferences move from high-end fashion and leather goods toward prestige cosmetics. Data from Circana indicates that the prestige beauty market has seen strong growth, rising 7% in North America, 5% in Europe, and 10% in Latin America during the first half of the year.

This trend follows a period where the global luxury market lost approximately 20 million customers between 2024 and 2025. Major fashion and leather goods divisions for LVMH and Kering both reported a 5% decline in the first half of the year. In contrast, several luxury houses are pivoting to strengthen their beauty presence; Hermès launched lipsticks in 2020, and Celine introduced products in 2024.

Experts suggest this shift is driven by Generation Z, who prioritize wellness and aesthetics, seeking “signs of luxury” through more accessible items like makeup and skincare rather than high-cost accessories. This transition is reflected in market leadership, with L'Oréal recently overtaking LVMH at the top of the CAC 40.