As luxury spending tilts toward experiences over possessions, the art market faces mounting pressure to redefine how it creates value for a new generation of affluent consumers. Observer Labs
As the art world becomes more deeply enmeshed in the broader luxury ecosystem—shaped by shifting spending patterns and new geographies of wealth—and auction houses increasingly rely on luxury categories to drive growth in volume rather than value across price points, it is now essential to look beyond art-specific indicators and adopt a cross-sector lens when analyzing the market. Luxury industry reports now provide a crucial barometer of where the art market may be headed, particularly as recent surveys rank art as the worst-performing personal luxury good. That finding alone suggests the art market still has meaningful ground to cover in responding to behavioral shifts among HNW individuals that adjacent industries have already begun to navigate.
One of the most closely watched benchmarks in this context is the annual Luxury Study produced by Bain & Company in collaboration with Fondazione Altagamma. According to the most recent edition, the global personal luxury goods market has entered a phase of stabilization amid ongoing macroeconomic uncertainty and sustained price elevation. After reaching €364 billion in 2024, sales are forecast to total €358 billion in 2025, reflecting a modest 2 percent decline, effectively translating into flat performance at constant exchange rates. More broadly, global luxury spending reached €1.44 trillion in 2025, contracting by a marginal 1-3 percent compared with 2024 at current exchange rates, while remaining stable when adjusted for currency fluctuations. The second half of the year showed sequential improvement in the market’s trajectory, suggesting early signs of renewed momentum despite persistent economic headwinds.
The survey also confirms that secondhand luxury goods are gaining momentum. The segment is estimated to have reached €50 billion in 2025, growing by 4-6 percent and outpacing growth in new luxury goods. Strong performance across both hard and soft luxury underscores a structural shift in consumer behavior toward circulation, longevity and value retention. Auctioneers have clearly taken note, as reflected in the growing emphasis on luxury collectibles and the expansion of cross-category sales among the major houses.
But at the heart of the study is a clear emphasis on how, in the post-pandemic era, luxury has shifted decisively toward experience-based consumption, which continues to drive momentum. Luxury’s center of gravity has moved from objects to experiences—from possession to access—as wealthy consumers redirect spending toward mobility, personalization and emotional fulfillment. This transition carries significant implications for the art world, particularly as it seeks to engage a broader affluent audience beyond traditional patrons and connoisseurs.
Worldwide luxury spending remained stable in 2025, but cross-sector data offers a sobering benchmark for where the art market in particular may be headed next. Courtesy Bain & Company
In 2025, luxury experiences once again outperformed products, rising approximately 3 percent, supported by a structural reallocation of spending toward wellness, pampering and social connection. Luxury hospitality rose 3 percent year-on-year, while fine dining maintained a steady global growth trajectory, up 5 percent since 2024 and more than 20 percent since 2019. Private jets and yachts are on a similarly upward trajectory, up 9 percent since 2024 and 43-45 percent since 2019, as the market shifts toward “mobility-as-a-service,” with affluent consumers increasingly favoring flexible formats such as fractional ownership and subscription models. By contrast, as wealthy consumers adopt more fluid lifestyles across geographies and grow less inclined to own assets with high maintenance and logistics costs, the luxury car market declined 6 percent from the previous year.
The surveys also point to rapidly evolving consumer profiles, with buyers entering the category younger and prioritizing longevity, activity and well-being. This shift aligns with broader hospitality dynamics, including reports of higher-end restaurants offering smaller portions at the same or even higher prices. Even so, fine dining remains on a sustained growth path, up 5 percent since 2024 and 39-41 percent since 2019, fueled by emerging luxury food hubs in the Middle East and Southeast Asia, alongside the growing share of elevated casual dining among younger audiences.
In this landscape, art’s estimated 9 percent decline stands out—comparable to luxury cars at 6 percent but notably weaker than jewelry, which recorded a downturn of just 2 percent from 2024, reaching approximately €32 billion, and remains up 25-27 percent since 2019. Meanwhile, watches and apparel remained broadly stable, though performance was polarized across players and price points. The watches segment showed resilience at both the high and entry ends of the market, alongside a particularly active secondary market, as tariffs and rising retail prices pushed some consumers toward pre-owned alternatives.
Growth in hospitality, travel and experiential offerings underscores how affluent consumers are redirecting spending toward moments rather than objects. Courtesy Bain & Company
The survey acknowledges that while the luxury market remains resilient, it is not immune to persistent macroeconomic headwinds and global uncertainty, both of which weigh on consumer confidence. Bain & Company forecasts a rebound in 2026, projecting moderate expansion of 3-5 percent. That outlook assumes sustained U.S. momentum supported by strong financial markets, continued resilience in Europe, solid domestic demand in Japan and steady progress in China’s recovery. The scenario closely mirrors expectations circulating in the art world after last year’s record-setting fourth quarter—a moment widely described as both hopeful and clarifying.
Geographically, Europe remains the largest market for personal luxury goods despite a slight contraction in 2025, reaching €110 billion, largely driven by increased tourist spending. Notably, that dynamic does not necessarily translate to the art market, where the U.K. and Europe are losing even their second-place position. The Americas retain second place in luxury consumption and emerged as the most resilient region this year. In Asia, mainland China recorded another significant decline, though less pronounced than in 2024, maintaining its third-place ranking, while Japan saw a marked correction following its record performance in 2024.
The report also highlights emerging markets as new avenues for growth, with Latin America, India, Southeast Asia and Africa expected to add more than 50 million upper-middle-class luxury consumers by 2030. Collectively, these markets are projected to represent €40-45 billion in total retail sales value, equivalent to mainland China’s luxury market in 2025.
A formula for longevity?
Overall luxury spending, including goods and experiences, is expected to grow 4-6 percent annually over the next decade, reaching an estimated €2.2-2.7 trillion by 2035. The report further identifies three key forces shaping the future of luxury: entertainment, emotions and ethics—terms that could just as easily describe the art world’s intrinsic strengths, though they are often diluted at its highest tiers. To reignite growth and sustain demand, Bain & Company’s annual Luxury Study suggests, the art world must embrace a framework grounded in inclusivity and engagement rather than relying on the cachet of exclusivity.
Accessible luxury outperformed the wider market. Courtesy Bain & Company
Interestingly, the survey notes that luxury staged a comeback in 2025 as brands expanded into adjacent and lower-entry categories. Accessible luxury emerged as the most dynamic segment, with roughly 50 percent of brands expected to have grown in 2025, compared with about 25 percent in aspirational luxury and 35 percent in absolute luxury. This segment is strategically important for onboarding and retaining younger demographics—an imperative frequently discussed in the art world as the broader luxury industry confronts a shifting demographic landscape. Compared with 2024, the sector lost approximately 20 million consumers, underscoring the urgency of rebuilding its base.
Millennials accounted for about 46 percent of total luxury spending, marginally down from 2024. Gen Z showed pockets of promise, with certain brands unlocking growth despite the cohort’s complexity. More engaged yet more critical, more open yet less loyal, Gen Z prioritizes individual identity over collective belonging and evaluates brands based on cultural relevance rather than status alone.
At the same time, younger generations are entering the market earlier, older cohorts are staying engaged longer, and long-standing clients continue to express a durable appetite for luxury. More than 70 percent of lapsed customers say they intend to resume purchasing within three years, while 90 percent of current buyers plan to continue spending, particularly Gen Z and high-net-worth individuals. Notably, optimism in the art world is increasingly concentrated at the top and bottom ends of the market.
The findings make clear that meeting these evolving behaviors and sustaining engagement requires differentiated journeys that integrate digital, physical and social experiences into cohesive storytelling ecosystems. The art world, in other words, needs to meet consumers where they are. But the defining characteristics of the next era of luxury remain open to interpretation. In the survey, Bain & Company suggests that longevity should rest on key pillars: ethics and responsibility, cultural relevance, emotional engagement and sustained creative innovation. To target and retain buyers, brands must create personalized, once-in-a-lifetime experiences, innovate across every touchpoint of the experiential and narrative journey and cultivate deep emotional bonds.
For the art market, still recalibrating after contraction and grappling with similarly shifting audiences, these pillars may offer not only context but a potential blueprint for future sustainability—one that could depend less on ownership and connoisseurship and more on access, meaningful experiences and active cultural participation.
