The Mystique of Luxury Brands Conference Paper (2026)

Keio University. Photo by Richard Liu / Unsplash

Author's Note

How does luxury strategy become something store teams believe in and deliver?

I’m bringing that question to The Mystique of Luxury Brands Conference in Tokyo, Japan, this week. This will be my first research conference as a PhD student. The abstract below is the conference paper that I will be presenting. The abstract was limited to two pages.

My abstract is based on an essay I wrote in a Leadership Theories course. You can read the original essay here, and to learn about the RLAA model, click here.

Leadership in Times of Strategic Retrenchment: A Conceptual Model for Closing the Strategy–Execution Gap in Luxury Retail

Abstract

Luxury retail is undergoing strategic retrenchment after post-pandemic expansion, exposing a persistent strategy–execution gap at the store level. Corporate initiatives often fail not because of weak strategic design but because frontline employees lack buy-in and alignment with strategic intent. This conceptual paper proposes the Retail Leadership Alignment Architecture (RLAA), a multi-level model explaining how transformational leadership at the executive retail level, adaptive leadership at the regional level, and servant leadership at the store level may influence frontline buy-in and execution. Drawing on leadership theory, frontline retail research, and luxury strategy, the model positions frontline buy-in as a mediating mechanism between leadership coherence and client experience outcomes. Kering is used as an illustrative context because it is navigating strategic retrenchment, leadership transition, cost discipline, and brand repositioning. This paper contributes to luxury retail management research by framing leadership alignment as a human-centered strategic capability.

Keywords: luxury retail management, transformational leadership, frontline employee buy-in, strategy execution, servant leadership

Background

Luxury retail is entering a period of recalibration marked by slower demand, tighter resources, and greater scrutiny of store productivity. Kering illustrates this pressure: in 2025, the group reported revenue of €14.675 billion, down 13% on an as-reported basis, while recurring operating income declined by 33%. Gucci, its flagship brand, reported a 22% decline in revenue and a 40% decline in recurring operating income (Kering, 2026). Industry reporting similarly situates Kering within a broader luxury slowdown and brand-repositioning cycle (Financial Times, 2025; The Wall Street Journal, 2025).

This context raises a core leadership question: why do corporate strategies often lose force at the store level? In luxury, strategy is formulated at headquarters, but value is delivered through store managers and sales associates. Kapferer and Bastien (2025) argue that, aside from the creator, the people most central to a luxury brand are those who make the product and those who interact directly with the client. This supports the central argument of this paper: corporate and field leadership must enable the teams closest to the client if strategy is to become lived experience rather than executive intent.

Conceptual Grounding and Model Development

The RLAA model integrates transformational, adaptive, and servant leadership theories. At the executive retail level, transformational leadership creates shared meaning, vision, and commitment (Northouse, 2022). In retrenchment, this matters because execution requires belief, not merely compliance. At the regional level, adaptive leadership enables Regional Managers to translate corporate priorities into locally relevant practices while preserving strategic intent (Heifetz et al., 2009; Northouse, 2022). At the store level, servant leadership supports frontline engagement by emphasizing listening, empowerment, and employee development (Northouse, 2022).

Frontline buy-in functions as the mediating variable between leadership alignment and store-level execution. The model assumes that strategy becomes effective only when it is made meaningful by executive retail leadership, made locally relevant by Regional Managers, and made emotionally credible by Store Managers.

Retail research reinforces this logic. Lawson (2021) links servant leadership, employee engagement, change readiness, and intent to quit among frontline retail employees. Hadjisolomou (2019) shows that front-line service managers often experience pressure between corporate demands and frontline realities. Together, these studies suggest that execution should be understood as a leadership system rather than a communication cascade.

This paper uses a conceptual theory-building approach rather than original human-subject data. It synthesizes luxury strategy, leadership theory, frontline retail research, and strategy execution literature to develop a model for future empirical testing.

The RLAA model generates five propositions for future empirical study:

P1: Transformational leadership at the VP of Retail level positively influences perceived strategic clarity among Regional Managers and Store Managers.
P2: Adaptive leadership among Regional Managers strengthens the translation of corporate strategy into locally relevant store-level execution practices.
P3: Servant leadership among Store Managers positively influences frontline employee engagement, psychological safety, and buy-in.
P4: Frontline employees’ buy-in mediates the relationship between vertical leadership alignment and store-level strategy execution.
P5: Resource constraints moderate the relationship between leadership coherence and execution effectiveness, making leadership alignment more critical when incentive budgets, staffing, and activation resources are limited.

Expected Contributions and Conclusion

This paper contributes to luxury retail management research by shifting attention from strategy formulation to strategy execution. It introduces frontline employee buy-in as a strategic mechanism linking leadership behavior to client experience outcomes. It also connects luxury strategy with leadership theory by emphasizing that corporate functions should support those closest to product creation and client interaction. For practice, the RLAA model reframes execution as a human-centered leadership system. In a luxury context, supporting store teams is not only an internal management preference; it is essential to protecting brand desirability, client trust, and long-term performance.

References

Financial Times. (2025). Kering sales slump as crisis deepens at Gucci.

Hadjisolomou, A. (2019). Front-line service managers’ misbehaviour and disengagement: The elephant in the store? Employee Relations.

Heifetz, R. A., Grashow, A., & Linsky, M. (2009). The practice of adaptive leadership: Tools and tactics for changing your organization and the world. Harvard Business Press.

Kapferer, J.-N., & Bastien, V. (2025). The luxury strategy: Break the rules of marketing to build luxury brands (3rd ed.). Kogan Page.

Kering. (2026). 2025 results: Sequential improvement, unlocking the next phase of sustainable and profitable growth.

Lawson, A. (2021). Frontline retail employees—Extinct or evolving: A look at the relationship between servant leadership, employee engagement, organizational change recipients’ belief and employee intent to quit [Doctoral dissertation, Oklahoma State University].

Northouse, P. G. (2022). Leadership: Theory and practice (10th ed.). Sage.

The Wall Street Journal. (2025). Gucci owner Kering posts sales drop amid lingering weak demand.

Join the Conversation 💡

Where do you see the strategy–execution gap most often: executive direction, regional translation, store leadership, or frontline buy-in?

I’d be interested to hear how others have seen this play out across luxury retail, leadership, and organizational change. Share your questions and perspectives below.