The global luxury industry is bracing for what could be its most significant headwinds in 15 years. According to the annual report by consulting firm Bain & Company and Italian luxury association Altagamma, the market—valued at EUR 1.478 trillion in 2024—is expected to slow in 2025. Sales of personal luxury goods, including fashion, leather goods, jewelry, watches, and fragrances, which account for roughly a quarter of the market, could decline by 2 to 5% under “the most likely scenario.”
The quest for innovation
Over the long term, the study notes that "fundamentals and prospects remain strong." In the next five years, more than 300 million new consumers are expected to enter the luxury market — half of them from Generation Z (born in the late 1990s to early 2010s) and Generation Alpha (born after 2010). Rising global incomes and the transfer of wealth between generations are set to significantly expand the pool of potential luxury customers, according to Bain & Company.
In this context, however, brands will need to reinvent themselves and reembrace innovation — especially to dispel doubts about the true added value of luxury.
A vehicle for brand values
To address these demands, packaging in the luxury sector is undergoing a quiet revolution: getting smarter, greener, and more purposeful. According to Bain & Company, sustainability is no longer a trade-off in the world of high-end packaging — it’s becoming a competitive edge.
The report Luxury Packaging: Resolving the Tension Between Creativity and Impact —produced in collaboration with Fedrigoni Group, a global leader in specialty papers, self-adhesive materials, and RFID tags — forecasts that over 30% of all luxury product packaging will adopt sustainable solutions within the next three years.
“Packaging is evolving from a static container into a dynamic brand touchpoint,” said Claudia D’Arpizio, senior partner and global head of the Fashion and Luxury practice at Bain & Company. “It’s no longer about choosing between beauty and responsibility. Today, you can — and must — deliver both.”
While luxury has long been defined by sensory experiences – the feel of a hand-crafted box, the gleam of a bespoke bottle – brands are now reimagining their packaging, not just as a container, but as a statement of their environmental values.
“Every day, through our close collaboration with brands, designers and converters, we witness the evolution of what luxury truly means: no longer just about aesthetics and exclusivity, but increasingly about responsibility, transparency and positive impact. In this context, packaging becomes a powerful cultural symbol — beauty that reflects values, and innovation that embraces sustainability,” said Marco Nespolo, Fedrigoni Group CEO.
A gate to new digital experiences
According to the report, the packaging is now being viewed not as the end of the journey, but the beginning. For instance, QR codes embedded in boxes can reveal the origin of raw materials, or the product story, smart labels help verify authenticity, and augmented reality overlays enhance the unboxing experience.
Offering full transparency into a product’s lifecycle, soon-to-be-standard Digital Product Passports (DPP) are at the center of this digital evolution, Bain & Company highlights.
“For today’s luxury consumer, knowledge is part of the reward,” said D’Arpizio. “They want to know where something came from, how it was made, and what happens to it next. Packaging is now the portal to that story.”
However, integrating sustainability as a core focus requires brands and packaging manufacturers to collaborate more closely in developing innovative and cost-effective alternatives, the report emphasizes.
Thus, the future of luxury packaging isn’t just lighter or recyclable. The new generation of sustainable luxury packaging will increasingly reflects the industry’s broader transformation toward transparency, responsibility, and deeper emotional connection.
