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The State of Fashion:Luxury 2025

McKinsey & Company and BoF Insights report

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Global fashion faces challenging landscape

The ninth annual State of Fashion report by McKinsey & Company and BoF Insights highlights the challenging landscape the global fashion industry faces in 2025. With economic uncertainty, changing consumer behaviors, and evolving market dynamics, the year is expected to be a critical juncture for many brands.

Overview

Economic Challenges: 80% of executives foresee no improvement in the industry, and only 18% rank sustainability as a top concern, down from 29% in 2024. Consumer confidence and spending remain major issues.

Key Drivers: Price sensitivity, the rise of dupes, climate change acceleration, and reshuffled global trade create a difficult environment.

Geographic Shifts: Growth engines in Asia, particularly India, Japan, and Korea, are becoming pivotal as China faces economic challenges.

Themes Driving the Agenda

Trade Reconfigured: Brands are diversifying sourcing to align with evolving trade policies and sustainability targets. Nearshoring and political alignment are critical considerations.

Asia’s Growth Engines: While China slows, India, Japan, and Korea are emerging as vital markets for growth.

Discovery Reinvented: AI-driven curation in e-commerce promises to help overwhelmed shoppers navigate abundant choices.

Silver Spenders: The growing over-50 demographic offers new opportunities for incremental growth, emphasizing the need for inter-generational appeal.

Value Shift: Resale, off-price, and dupe markets are flourishing as consumers seek better value amid persistent economic pressures.

The Human Side of Sales: Enhancing in-store experiences by empowering well-trained sales staff can drive demand for physical retail.

Marketplaces Disrupted: Online non-luxury marketplaces face existential challenges, struggling with declining demand and rising customer acquisition costs.

Sportswear Showdown: Challenger brands are rapidly gaining market share, driving competition in the dynamic sportswear segment.

Inventory Excellence: Advances in inventory management and agile supply chains are key to addressing margin pressures and meeting sustainability goals.

The Sustainability Collective: Collective action is essential to meet decarbonization goals despite consumer reluctance to pay premiums for sustainable products.

Looking Ahead

The industry’s outlook remains sluggish, with revenue growth stabilizing in low single digits. Luxury’s dominance in profit creation is challenged by non-luxury segments for the first time since 2010. Brands that act nimbly to address geographic shifts, demographic changes, and technological innovations will find opportunities amid the turbulence.

Growth in the jewellery sector will be fueled by rising demand from ultra-high spenders and continuous investment from luxury houses in technology and expertise.

The new playbook for 2025 emphasizes adaptability, localization, and sustainability, while redefining value and consumer engagement. The fashion sector must innovate, embrace technology, and prioritize long-term resilience to navigate this period of reckoning successfully.

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JB Insights

Dhanteras 2026: Strong Footfalls, Value-Led Growth Across India’s Jewellery Trade

Dhanteras 2026 opened on a confident note for India’s jewellery industry. Retailers and industry bodies report higher footfalls, double-digit value growth and a visible shift in what customers are buying. Volumes, however, are largely flat, and the growth is being carried by price.

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Market Size and Growth

The Gem & Jewellery Council (GJC) estimates India’s Dhanteras gold business at roughly ₹60,000 crore on preliminary assessment. Rajesh Rokde, Chairman, GJC, says value growth is expected at 15–20% over last year, with volumes “almost at the same level.” He calls it “a very encouraging start for the jewellery industry.”

Retailers are reporting stronger numbers. Suvankar Sen, MD & CEO, Senco Gold Ltd, reports sales value up over 25% year on year, with higher store footfalls. Dr. Saurabh Gadgil, CMD, PNG Jewellers, says industry indications point to 25–30% incremental performance. He attributes this to easing prices, strong pre-Dhanteras bookings and a long Diwali weekend. Jignesh Mehta, Founder & MD, Divine Solitaires, reports 30% growth in festive sales.

What Customers Are Buying

  • Gold: Sachin Jain, Regional CEO India, World Gold Council, notes strong walk-ins across retail markets. Buyers are choosing jewellery, coins, bars, ETFs and digital gold. He says the recent price moderation has given buyers relief.
  • Diamonds: Senco Gold’s Sen says diamond jewellery sales “have grown impressively.” Divine Solitaires’ Mehta points to rising interest in natural diamond solitaires for gifting, milestones and self-purchase, led by smaller solitaires and lightweight pieces.
  • Silver and multi-metal: Ansh Anand, CEO, Punjab Jewels, reports strong interest across gold, diamond, platinum and silver. PNG’s Gadgil adds that silver jewellery and articles are in high demand.
  • Men’s jewellery: Sen flags growing interest, with Senco’s Aham line catering to men who see jewellery as personal style.

Key Trends

1. Lighter, everyday designs are gaining. Sen sees growing interest in lighter, more versatile designs alongside traditional gold and coins. Jayantilal Challani, Chairman, Challani Group of Companies, observes a visible shift from heavy traditional jewellery to everyday elegance.

2. Value-conscious, disciplined buying. Challani describes buyer mood as “calculated optimism and value-driven purchasing,” with high gold rates prompting disciplined shopping. Punjab Jewels’ Anand says customers are prioritising design, craftsmanship and quality alongside investment value, and festive enthusiasm has held despite elevated metal prices.

3. Trust and transparency matter more. Divine Solitaires’ Mehta says consumers place greater emphasis on transparency, authenticity and quality assurance. He cites the company’s 123-parameter Quality Guarantee and standardised pricing as the response.

4. Old gold exchange is a growth lever. PNG’s Gadgil says exchange is playing a big role, including in tier 2 and tier 3 cities.

5. Weddings and savings-led purchases. Sen reports strong participation from wedding customers and from families buying jewellery as savings.

Outlook

Sentiment is positive heading into Diwali and the wedding season. The WGC’s Jain says the day’s response “offers an encouraging outlook for the year end.” Gadgil notes that sales usually pick up in the second half of Dhanteras, so early figures may understate the final tally. Challani adds that grassroots spirit remains intact, which gives hope to jewellers who sell big and heavy pieces.

Bottom line: Dhanteras 2026 is a value-led recovery. Price easing, wedding demand, diamond and silver momentum and strong festive bookings are driving growth, while volumes hold steady. Retailers who combine lighter designs, transparent pricing and exchange offers are best placed to gain.

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JewelBuzz is Asia’s First Digital Jewellery Media & India’s No.1 B2B Jewellery Magazine, published by AM Media House. Since 2016, we’ve been the trusted source for jewellery news, market trends, trade insights, exhibitions, podcasts, and brand stories, connecting jewellers, retailers, and industry professionals worldwide.

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