(Image credit: Getty Images)
Marc Jacobs’ eponymous label is the latest to go in what increasingly looks like LVMH’s retreat from “middle luxury” – brands and products positioned between mass market and true luxury. For a luxury conglomerate historically known as a buyer, not a seller, these divestments suggest both internal headwinds and a broader restructuring of the fashion industry, as the average consumer shapeshifts in response to economic uncertainty and changing global consumption patterns.
The LVMH—Marc Jacobs relationship spans more than thirty years
Marc Jacobs was founded by its namesake designer in 1986. By the time LVMH acquired a majority stake in the brand in 1997, Marc Jacobs himself was already well on his way to the fashion “hall of fame.” The deal marked the beginning of a hugely productive – if somewhat unlikely – partnership between the European luxury conglomerate and the stylistically American fashion designer.
The acquisition also led to Marc Jacobs’ appointment as creative director of Louis Vuitton, a role in which he would help shepherd the heritage brand (which, at the time, was rapidly losing cultural cachet) into the twenty-first century. Under his helm, the leather goods maison embraced ready-to-wear and high-profile artistic collaborations. These changes secured the brand’s continuing relevance and the designer’s own reputation as one of the greatest of his era.
Nevertheless, the Marc Jacobs label began to hit choppy waters in the 2010s. The fashion industry was changing and becoming increasingly polarised: heritage brands repositioned themselves further upmarket, while fast fashion and sportswear swallowed market share below them. The middle ground of “middle luxury” became increasingly untenable for brands like Marc Jacobs.
By the turn of the decade, the label appeared to be in serious trouble, closing many of its boutiques and streamlining its operations. Following Trump’s election victory in 2016, Bernard Arnault reportedly remarked: “I’m more concerned about Marc Jacobs than the U.S. president.”
Still, Marc Jacobs never entirely disappeared from the cultural conversation. Heaven by Marc Jacobs became something of a lifeline for the label, with its baby tees and fun graphics reconnecting it to a younger audience fluent in irony, nostalgia and internet-driven visual culture. More importantly, Marc Jacobs himself remained a deeply respected figure within fashion — and, for a long time, that cultural cachet alone seemed reason enough for LVMH to hold on.
So why the decision to sell?
The first thing to say is: don’t panic. Marc Jacobs is not collapsing, and the brand won’t be disappearing from shelves anytime soon. If anything, it has a few obvious reasons to expect a short-term boost: a beauty relaunch, a Sofia Coppola-directed documentary about the namesake designer, and the nostalgia cycle playing firmly in its favour.
But the question is not whether Marc Jacobs has value. It is whether the brand has the kind of value desired by LVMH.
Luxury has been struggling recently. Inflation, recession fears, tariffs, geopolitical instability and a broader cost-of-living squeeze have made shoppers more cautious. That matters because Marc Jacobs’ customer is not, for the most part, the billionaire buying Birkin bags without looking twice at the price tag. Their customer base is more likely to be aspirational, trend conscious and sensitive to prices.
There is luxury, and then there is… expensive stuff. True luxury is often described as resistant to recessions because its main clients are insulated from ordinary economic pain. In some cases, higher prices can even increase desirability. “Middle luxury” or “mass prestige” works differently because consumers shopping in this category care about value for money: they ask – is this bag worth it? Can I get it elsewhere, for cheaper? And will buying this bag mean I can’t afford to pay my bills? This factor is ultimately what makes brands like Marc Jacobs uniquely vulnerable.
What’s more, the rise of resale (Fun fact: Vinted is now the third-largest fashion retailer in the UK) has changed the rules of the game. When consumers can buy older true luxury pieces at similar prices to new middle luxury items – often with better resale value – the appeal of buying brand new from an accessible designer brand becomes less obvious.
LVMH’s decision signals a vote of “no confidence” in “middle luxury”
The Marc Jacobs sale is therefore not simply about LVMH offloading a less profitable business. The luxury conglomerate’s model relies heavily on economies of scale. LVMH’s portfolio of 75 brands shares production systems, logistics, retail infrastructure and managerial expertise, spreading fixed costs across multiple businesses. This, in turn, drives down cost. But for that strategy to work efficiently, the brands within its portfolio need to be similar enough in audience, positioning and ambition – and Marc Jacobs increasingly was not.
LVMH selling Marc Jacobs suggests a widening divide between true luxury and “middle luxury.” The two categories may once have comfortably coexisted under the same umbrella, but they now require fundamentally playbooks.
For Marc Jacobs, a company like WHP Global – the eventual buyer of the label – may simply be a better fit. Brand-management groups prioritise licensing, distribution and commercial expansion over exclusivity and legacy building. That could mean wider reach for Marc Jacobs, but also risks diluting the very specificity and cultural cachet that made the brand compelling in the first place.
Perhaps, though, that is precisely the point. Marc Jacobs no longer fits neatly within the LVMH machine – and increasingly, the middle of fashion no longer fits neatly within luxury either.
Why should we care?
The Marc Jacobs sale matters because most people, and especially us students, are not shopping at the very top of the luxury pyramid, but rather in the middle: going for the accessible bag, the perfume, the second-hand trophy item and the discounted designer piece. Brands like Marc Jacobs built their entire business on making fashion aspiration feel attainable, but that middle is now under pressure.
Luxury is moving further out of reach, while resale has made older “true luxury” newly accessible. Consumers are more price-conscious, more informed and less loyal than they once were. In that environment, “middle luxury” has become a much harder sell.
So, is LVMH selling Marc Jacobs a canary in the “middle luxury” fashion coal mine? Perhaps. Not because Marc Jacobs is doomed, but because its sale reveals where the pressure in fashion is building: the middle.