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      Gen Z are not just the key untapped demographic for brands; they are the future. Winning their loyalty starts by understanding what they expect luxury to be.
       

      Before the rise of e-commerce, selling unwanted items took real effort. Today, with just a few clicks, a pre-loved luxury handbag or watch can move from one owner to another anywhere in the world. That shift has powered a fast-growing global resale market worth about US$55 billion, driven predominantly by Gen Z consumers.

      For brands, this booming second-hand market poses a challenge: They have little control over how their products are resold, displayed or perceived once they leave the boutique. And as our recent Luxury in the Midst of Change report shows, most brands remain on the sidelines. Getting involved would not only help them regain control; it would ensure they understood a crucial motivator for Gen Z: That their purchases feel responsible and circular, and are aligned with their values. For Gen Z, sustainability is more than a buzzword; it is a baseline expectation. is a baseline expectation.  

      Beyond sustainability – and status 

      The 7 percent of brands that do include second-hand products in their strategy are acting either to support their sustainability image or to meet Gen Z’s expectations. They recognise sustainability matters deeply to Gen Z.

      But sustainability is only the entry point. For this generation, environmental responsibility sits within a wider demand for transparency, ethical sourcing and a brand’s social impact – pillars they actively evaluate before committing. Importantly, these expectations are not separate from their understanding of luxury; they define it.

      Where luxury for older clientele was linked to exclusivity, heritage and status – an aspiration communicated by logos – Gen Z evaluates status differently. For them, status still matters, but it is intertwined with identity, values and self-expression. They want seamless, mobile-first experiences across online and offline channels, and they expect to shape how a brand shows up in culture: contributing through their content, engaging through communities and influencing storytelling rather than simply consuming it.

      In short, Gen Z use brands as signals of who they are and what they believe in – which is why authenticity is non-negotiable. Brand that cannot substantiate claims, whether around sustainability or culture, risk immediate disengagement.

      The rise of quiet luxury and experiential luxury 

      Gen Z, then, is different – but the rise of quiet luxury is not primarily a Gen Z phenomenon. Quiet luxury is driven largely by ultra-high-net-worth consumers who favour craftsmanship over conspicuous branding, quality over flashiness. However, what Gen Z is gravitating toward is adjacent: a growing interest in niche maisons and independent designers whose products feel personal, meaningful and aligned with their values, even if they are not “quiet luxury” in the traditional sense.

      This shift reflects a broader attitude: Luxury is increasingly defined not only by visibility but also by meaning. Younger consumers want pieces that speak subtly to their identity, or experiences that feel unique – attributes that prestige logos alone can no longer guarantee.

      Knowing this, how should brands target Gen Z? While authenticity is crucial, so too is meeting Gen Z where they want to be. Experiential luxury is emerging as a powerful route, which is why – rather than focusing solely on high-end physical products – many brands are investing in luxury experiences: Fine-dining collaborations, curated travel, wellness retreats, customised services or access to exclusive cultural events.

      Why experiences? Because they deliver emotional value – they create memories, deepen brand loyalty and are highly shareable. In a social media-fuelled world where visibility underpins identity, participation in limited-edition experiences is a powerful currency. It is why 53 percent of brands – from established maisons to emerging labels – are expanding into areas such as hospitality, beauty and wellness, recognising that experiential touchpoints are now central to engaging consumers.

      Experiences have become a strategic acquisition channel, and are often the first touchpoint through which Gen Z interacts with a luxury brand – even before purchasing.

      The ABC of experiential luxury in Southeast Asia 

      Southeast Asia offers a particularly exciting landscape for experiential luxury and Gen Z engagement. With one of the world’s youngest and most digitally enabled populations, the region reveals three engagement principles that matter most.

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      A is for Access:

      Providing early access to product drops, private events or backstage opportunities makes Gen Z feel part of a brand’s journey, rather than simply a customer. In a region where community and belonging shape consumer identity, this dramatically strengthens loyalty.

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      B is for Belonging through localisation:

      Pop-ups that incorporate local art or music, collaborations with homegrown designers or celebrations of regional cultural moments create experiences that feel authentic. In this diverse region, localisation matters –reinforcing pride, identity and connection.

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      C is for Combining online and offline:

      Bringing together digital and physical touchpoints transforms stores from transactional spaces into experiential ones. Gen Z want more than a shop; they want an experience – a place to immerse themselves in the brand story, interact with technology, create content and feel part of something. Stores that blend digital features with physical intimacy become powerful engagement engines.


      Winning Gen Z’s loyalty 

      Clearly, reaching Gen Z is harder than marketing to older customers who have historically responded to recognisable logos and prestige. As my first article notes, one approach brands are exploring is product tiering: Maintaining ultra-exclusive items for wealthy clients while creating more accessible categories like leather goods and cosmetics.

      However, as our research shows, brands must do more. Gen Z expect experiential luxury delivered locally in a culturally relevant manner. Additionally, they expect meaningful digital engagement, delivered through experiential retail formats. They also want brands to exhibit genuine sustainability credentials; greenwashing will not cut it.

      While meeting these expectations is demanding, the payoff is significant. Brands cannot treat Gen Z as tomorrow’s consumers – they are today’s tastemakers, a generation with rising purchasing power, strong values and the desire to connect with brands that reflect their identity. Brands that move quickly to redefine luxury around sustainability, creativity, inclusivity and experience will attract Gen Z and secure their long-term loyalty.

       


      Our people

      James Wilson

      Partner, Technology Consulting, Advisory and Head of Consumer & Retail

      KPMG in Singapore