U.S. Designer Labels Surge as American Brands Outpace European Luxury

U.S. designer labels are tightening their grip on the luxury market as American brands increase branding and accessibility. Ralph Lauren Corp. and Tapestry Inc., the parent company of Coach and Kate Spade, have posted notable stock gains this year—about 29 percent for Ralph Lauren and roughly 55 percent for Tapestry—while sales at European luxury houses softened. The Wall Street Journal reports that Coach and Ralph Lauren posted sales gains of 13 percent and 11 percent, respectively, this year. The lineup places these American brands among the leaders in the luxury goods sector, ahead of European names such as Hermès, Brunello Cucinelli, and Richemont.

Tapestry led five-year shareholder returns, per FactSet. In the third quarter, it surpassed expectations with revenue of $1.6 billion, up 8 percent. Coach emerged as the top performer among fashion houses and achieved its highest gross margin in company history. The brand has also increased advertising budgets and pressed its rebranding effort to widen its appeal, a move that has aligned with broader interest in American luxury narratives over European peers.

Analysts say the shift toward affordable luxury is a defining trend this year, with Ralph Lauren and Coach positioned to capitalize on midtier pricing that broadens access without sacrificing brand prestige. Coach’s products regularly sit in the roughly $200 to $500 range, while Ralph Lauren emphasizes staple pieces and accessible luxury items. In contrast, European rivals such as Hermès, Prada, and Brunello Cucinelli remain anchored in higher price tiers and scarcity strategies, which can limit mass-market growth even as they retain prestige.

Coach’s rebranding strategy has been central to its renewed momentum. The brand returned to familiar silhouettes like the Tabby bag, intensified social media advertising, and expanded personalization to appeal to younger consumers. In 2023, Coach launched an immersive program called Coach Play, transforming stores into interactive experiences. The company also tapped Elle Fanning for a recent campaign, signaling a pivot toward aspirational yet approachable messaging that resonates with Gen Z and younger shoppers.

Ralph Lauren has leaned into a clear, American-luxe narrative, stressing staples such as blazers and knitwear while maintaining aspirational marketing. The brand has highlighted its heritage through campaigns that emphasize diversity and inclusive storytelling, including a viral summer campaign featuring Black models and families in Oak Bluffs, a historic Martha’s Vineyard locale. Ralph Lauren’s market valuation has approached $16 billion, underscoring investor confidence in its consistent branding and product mix.

The performance of U.S. brands comes as the luxury landscape evolves. While European houses continue to lead in ultra-luxury segments and craftsmanship, American labels have demonstrated that a broader approach to branding, multi-tier pricing, and online engagement can drive both sales and shareholder value. The shift also reflects consumer sentiment as recession fears influence spending patterns, making affordable luxury an increasingly attractive entry point for new luxury buyers, including younger generations.

Beyond individual campaigns, the broader market dynamic shows American brands widening their share of the luxury conversation. Ralph Lauren’s and Coach’s ability to scale messaging, targeted pricing, and online presence has helped them gain relevance relative to European counterparts such as Hermès and Prada, even as the latter maintain strong prestige and exclusivity. Industry observers note that the American narrative around accessible luxury, combined with strategic investments in marketing and omnichannel experiences, is contributing to sustained growth and positioning U.S. brands for continued market leadership in the near term.