Luxury Retailers Turn to Collaborations to Capture Younger Demographics

Luxury Retailers Turn to Collaborations to Capture Younger Demographics

A recent partnership between Swiss watchmakers Swatch and Audemars Piguet highlights a growing trend where high-end luxury brands align with mass-market names to court younger consumers. The companies introduced a collection of eight pocket watches priced around $400, designed to introduce mechanical watchmaking to a new generation. The launch generated significant global attention, resulting in long lines and high engagement on social media platforms, illustrating the potential power of these strategic alliances.

Industry experts suggest that these collaborations are becoming a necessary tool for growth. As established luxury brands saturate their core customer bases, partnering with accessible labels offers a pathway to expand reach. Andrew Goldberg, a vice chairman at CBRE Group, Inc., noted that data analytics and social media now allow brands to identify and target overlapping consumer demographics with precision. This data-driven approach helps companies understand trending personalities and follower networks, facilitating more effective marketing strategies.

The push for expansion comes amid a challenging environment for the luxury goods sector. According to a Global Luxury Retail report from Savills, the global personal luxury goods market experienced a marginal contraction of 2 percent in 2025. The report also indicated that new luxury store openings worldwide dropped to their lowest level since 2020, as brands adopted more disciplined and selective growth strategies. In North America specifically, new openings declined by 13 percent last year, attributed to softer spending, macroeconomic uncertainty, and portfolio rationalization.

Despite the headwinds facing physical goods sales, the report noted a shift in consumer preferences. While tangible luxury items faced a slowdown, the luxury experience sector—encompassing hospitality, cruises, travel, and fine dining—saw growth of 3 percent. This divergence suggests that while brands navigate a contracting market for goods, collaborations and experiential offerings remain key areas for potential engagement.

What to watch

• Future retail partnership announcements from major luxury brands targeting Gen Z consumers.
• Q3 reports from commercial real estate services firms regarding leasing activity for luxury retail spaces.
• Updates on store expansion strategies in North America following the 13 percent decline in new openings.

Source: original release