LuxExperience, a digital luxury retailer, has sharpened its focus on high-net-worth customers in response to recent challenges in the luxury market. Following an acquisition last year that expanded its platform portfolio, the company identified a critical issue: its newer, high-end sites were not adequately catering to the wealthiest shoppers. In response, LuxExperience shifted strategy, prioritizing customers who spend tens of thousands of dollars annually on luxury apparel rather than casual buyers seeking discounted deals.

This strategic realignment has resulted in increased net sales, higher average order values, and greater spending by top-tier customers, contributing positively to the company’s profitability amid a broader market slowdown. By targeting shoppers who typically spend around $50,000 per year and visit one of its platforms 10 to 15 times annually, LuxExperience accepted some loss of lower-tier buyers. However, this focused approach has provided a buffer against the softening demand impacting many luxury brands.

Martin Beer, Chief Financial Officer at LuxExperience, emphasized that the company’s primary clientele consists of ultra-wealthy individuals less influenced by economic pressures such as inflation and fluctuating gas prices. “This is not a customer that saves up for two years to buy a Louis Vuitton bag,” Beer said, underscoring a key distinction from the aspirational luxury market.

The company’s recent acquisition of Net-a-Porter, Mr. Porter, and the off-price high-end website Yoox from Richemont played a significant role in this transformation. Beer noted that Net-a-Porter and Mr. Porter had become dependent on markdown sales, prompting LuxExperience to overhaul the marketing approach and curate luxury labels more appealing to elite consumers.

For the three-month period ending June 30, LuxExperience reported growth in all business segments, a first since completing the acquisition. Net sales increased by 7.6% on a constant-currency basis. Average order values rose significantly, with Mytheresa recording an average order size of €875 (approximately $975), and Net-a-Porter and Mr. Porter seeing a 9% increase. Notably, top-tier shoppers, who represent less than 5% of the customer base across these three platforms, accounted for nearly half of total revenues.

Industry analysts have noted that LuxExperience’s limited exposure to traditional luxury hubs such as China, where demand has cooled, has helped insulate the company from broader market downturns. Anna Glaessgen, a senior research analyst at B. Riley Securities, points out that the group’s reduced reliance on aspirational buyers—who are more vulnerable to inflation and economic challenges—provides additional stability.

LuxExperience further maintains a diversified customer base across its platforms, minimizing overlap and shielding the business from localized economic pressures. Mytheresa offers a more traditional luxury brand portfolio, including names like Prada and Valentino, whereas Net-a-Porter and Mr. Porter concentrate on emerging designers, capturing distinct segments within the high-end market. This multi-faceted approach appears to be positioning LuxExperience for resilience as the luxury sector navigates evolving consumer dynamics.