After taking a hit during the pandemic, the luxury goods sector in the UK is steadily getting itself back on track and is forecast to grow by 2.18% CAGR over the next five years. And, as disposable incomes have risen, many UK consumers have more to spend on watches, jewellery, luxury fashion, cosmetics, and fragrances, says Nick Morgan, Founder & CEO of Vudoo.

In 2024, an estimated 17.6% of the UK’s luxury goods market’s revenue was generated through online sales. Consumers are expressing an increasing appetite to purchase via digital platforms, and research from Deloitte shows that 85% of luxury customers are using social media to engage with the brands they love.

And, while platforms like TikTok and Instagram are setting new expectations for what’s possible in digital commerce, there are other opportunities beyond social media – particularly in premium, brand-safe environments on the open web – that luxury brands can take advantage of as we approach 2026.

Commerce media has the potential to take the sector to new heights, and brands that take learnings from their social commerce strategies and apply them in the commerce media arena will reap the rewards.

Reputation matters – but how much?

When it comes to luxury, reputation matters. A customer’s perception of a brand plays a big part in driving sales – but prestige alone isn’t always enough. LVMH’s stock price falling by -7% following its quarterly results – its biggest drop since early 2020 – indicates that luxury brands can’t take anything for granted.

Luxury in the digital era means adapting marketing strategies for affluent consumers that are primarily tech natives. Unique, digital interactions are fundamental to luxury brands maintaining their premium position.

There’s a serious risk of a downturn for many luxury brands if they don’t adapt to current consumer behaviours. Many of these behaviours have been driven by social media platforms, with bite-sized content that demands audience interaction – reactions, comments, swiping on to the next piece of content, and even direct purchasing – setting a new bar for consumers’ preferences.

Social commerce: A launchpad for commerce media

For example, Selfridges is making an impact on TikTok with its humorous, eye-catching videos that link up to current themes such as aura points, featuring celebrities including Jeff Goldblum and Taylor Swift. It’s full of fun, informative snippets that hold appeal for consumers in a range of age groups.

But there’s a whole world of possibilities outside of the walled gardens of social media. Leveraging other innovative technologies that facilitate premium customer interactions is the way forward, and some luxury brands are making inroads with these tactics already.

Louis Vuitton, for example, has been experimenting with Augmented Reality (AR) within its app to craft immersive, interactive experiences connected to famous landmarks around the world. It’s also found numerous other applications for AR, as well as dabbling in the world of ultra-exclusive NFTs, to further cement the brand’s luxury status.

Also taking a new approach in reaching its affluent audience, Bottega Veneta has targeted United Airlines’s first-class passengers via the airline industry’s first media network, Kinective Media. The Italian luxury fashion brand can draw on insights and data from 100million travellers and 40million MileagePlus frequent flyers, serving ads on in-flight screens as well as in airports, lounges and on digital boards in airport terminals.

However, it’s on the open web where much of the untapped potential lies for luxury brands. They can take what they’ve learned from social commerce and apply it to their owned web properties, as well as advertising campaigns and sponsored content within the brand-safe, premium environments of publisher partners.

Here they can build unique digital experiences for their target consumers that they have full control of; and, crucially, they can design these experiences in such a way that closes the loop between inspiration and conversion.

Getting the most from commerce media

Luxury brands have an opportunity to leverage commerce media to both solidify customer loyalty and boost sales. One of the key learnings they should take from social campaigns is to prioritise interactivity. Moncler’s Genius website hosts a range of interactive elements to showcase its clothing range.

But while interactive websites are one thing, interactive video content goes further. Brands that can make their online video content active rather than passive, with features such as clickable elements within the video, can build greater engagement and foster even stronger connections with target audiences.

While many luxury brands might think of video as a tool that primarily builds brand awareness and brand equity, online video offers brands the chance not just to build awareness but to drive purchases as well – all in one place.

Shoppable videos that showcase products and have built-in checkout functionality to enable seamless purchasing to take interactivity to the next level, directly driving sales and allowing brands to attribute these outcomes to their commerce media campaigns.

Further interactive functionality such as ‘branching’ videos means audiences can select which items are featured in the content, taking them on bespoke pathways through video, while brands have the opportunity to add product information to boost the likelihood of conversion. Moët & Chandon’s interactive, shoppable ad campaign hosted in News Corp Australia’s web properties provides a template for how this can be done.

Luxury brands should also tap into personalisation to foster the perception of exclusivity. By capturing data that enables them to link sales directly to their campaigns, they can also mine it for customer insights to further inform personalisation efforts. For example, they could look at which products a customer has looked at before making the purchase, and what product information they were interested in, leveraging these insights to make the next campaign even more tailored. 

The game-changing opportunity of commerce media

While the essence of luxury doesn’t change – it’s about bespoke, high-quality and exclusive experiences – the way in which these experiences can be delivered has undoubtedly been revolutionised by digital platforms.

Video has long been part of luxury brands’ advertising strategies through the medium of television, and online video offers greater potential for interactive experiences. This allows luxury brands to build campaigns that meet the expectations of affluent consumers while making purchasing as seamless as possible by collapsing the sales funnel.

Moreover, the closed-loop data trail that commerce media offers means luxury brands can derive additional value from their commerce media campaigns, extracting purchase intent insights that provide a platform for even more personalised experiences in the future, driving better business outcomes.