The kids are the future — at least, that’s the case for London’s premier luxury brands at the moment.
Despite the economic turndown across the UK that has seen the pound plummet, the country’s richest Gen Zers appear to be even hungrier for the luxe life. According to the Guardian, luxury goods sales and venerable labels are increasing thanks partly to its youngest shoppers. Luxury conglomerate LVMH saw sales increase by 28 percent, with Burberry reporting an 11 percent rise within the last month—mainly due to well-heeled youth, unburdened by crushing debt, who want to keep up with the latest social media trends.
“These are people who aren’t necessarily paying a mortgage or high fuel costs,” James Ison, the man behind the Rich Kids of Instagram account, told the Guardian. “Kids of very successful business people or international students. They’re the younger generation who are more likely to bid on Louis Vuitton and Nike Air Force 1 trainers at £7,000 a pair.”
As the new generation begins to step into its own, luxury brands are learning how to appeal to their newest demographic. Studies show that Gen Z and millennials are more likely to embrace luxury than their predecessors. According to a report by online shopping platform Klarna, 63 percent of Gen Z and millennials bought more luxury items than their elders in the past 12 months.
Another driving factor is the growth of the luxury reseller—young, savvy collectors who treat their Rolex watches or Birkin bags like investments designed to appreciate in value. According to Ison, this new class of collectors took advantage of pandemic supply-chain issues to sell highly sought-after luxury goods on the grey market, often at 150 to 180 percent above retail.
“They just don’t have the supply—the big luxury brands are facing the same kind of issues as every other business with supply chains, so you’re getting people who are able to find something at retail and then sell it online 24 hours later for double,” Ison says.
Britain’s luxury sector will likely welcome these new consumers with open arms. London’s shops and brands, after all, are seeing a dip in business from American tourists, who are now heading to Paris and Milan to take advantage of tax-free shopping at designer stores.