Luxury Transformation: AI, Sustainability, and New Consumer Experiences

Luxury Industry Transforms: A New Era of Innovation and Sustnability

The luxury goods sector not only surpassed its pre-pandemic profitability levels in fiscal year 2022, but is also experiencing a significant transformation towards an environmentally responsible, circular business model. This shift, driven by consumer expectations and increasing regulatory pressures, is facilitated by the integration of cutting-edge digital technologies such as , and Internet of Things IoT. These innovations are reshaping customer experiences while revolutionizing sustnability practices, supply chns, and product authentication within the luxury industry.

Authors: Giovanni Faccioli Karla Martin Evan Sheehan

Luxury brands have traditionally embodied exclusivity, craftsmanship, and innovation. However, in recent years, they've been at the forefront of adopting technology and digitalization to explore new frontiers.stands out as a key driver, enabling luxury companies to provide personalized product recommations, styling advice, and real-time customer support through advanced chatbots and virtual shopping assistants. This technological integration create an unparalleled shopping experience that appeals uniquely to customers.

The luxury industry is also embracing the circular economy model, which aligns with innovations like Digital Product Passports DPP and Digital IDs for documenting a product's lifecycle sustnability from design to -of-life. These initiatives offer numerous benefits such as increased consumer trust, improved brand reputation, reduced risks of environmental clms misrepresentation, comprehensive product tracking, decreased goods in circulation, and the exploration of innovative business.

Key insights highlighted in our report:

1. Trs Shaping Luxury:

   • The luxury market is witnessing a resurgence, with notable sales growth and higher profitability than pre-pandemic levels.

   -is transforming customer experiences by personalizing recommations, styling advice, and real-time support throughpowered technologies.

2. Circular Economy in Practice:

   • Luxury brands are adopting sustnable practices by implementing circular economy principles through the use of Digital Product Passports DPP and Digital IDs for product lifecycle documentation.

   • This shift not only enhances consumer trust but also reduces environmental impact, aligning with global sustnability goals.

View previous reports

• Global Powers of Retling 2023https:www2.deloitte.comuseninsightsarticlesglobals-powers-retling-2023.html

• Sustnability in Retlhttps:www2.deloitte.comuseninsightsarticlessustnability-in-retl.html

• Fulfilling the Future of Possiblehttps:www2.deloitte.comuseninsightscfofulfilling-the-future-of-possible.html

Contact Us

• Giovanni Faccioli: Fashion Luxury Market Leader, Deloitte Global [email protected]:[email protected]

• Karla Martin: Managing Director, Deloitte Consulting LLP [email protected]:[email protected] +1 415 218 7645

• Evan Sheehan: Global Retl, Wholesale Distribution Sector Leader [email protected]:[email protected] 617 437 2734

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