The definition of luxury is evolving. Consumers have a more diverse definition of luxury, based on the variety and quality of goods available to them. Accessibility is a key factor. As consumer preferences evolve, so do brand values. The following are some of the main trends in luxury goods today. Read on to find out how these trends are affecting the concept of luxury. Let us begin with the changing nature of luxury. How can it be measured?
Consumers’ view of luxury is changing
The concept of luxury is evolving, from the purchase of rare and expensive items to personalized experiences and deeper meaning. Luxury brands are now challenged to adjust to these changes and cater to different consumer desires. While luxury audiences were homogenous a decade or so ago, these days, luxury consumers are increasingly diverse, and a brand can no longer rely on a unified market to grow and succeed. To keep up with this changing consumer landscape, luxury brands must continue to innovate and embrace new technologies.
In the past, luxury consumers were primarily interested in buying designer labels and other “must-have” accessories. Today, they are more sophisticated, educated about brands and increasingly demanding of their brand values. And they are approaching luxury brands across multiple channels. And while consumers’ perception of luxury is evolving, the luxury sector remains a thriving industry. It is predicted that global sales of luxury goods will grow at more than 7% a year, surpassing the GDP growth of many countries.
The recent COVID-19 pandemic and the recent protests against racism have changed the way people think about luxury. These two phenomena have made us increasingly aware of the disparity between rich and poor. As a result, we feel less comfortable with affluence. We also need to think about how we can continue to redefine the definition of luxury, especially for young people. Consumers are increasingly more likely to look for experiences that can provide a sense of value and reward.
Brand values are evolving
Consumers have evolved from a focus on products and services to a more holistic view of quality and luxury. While luxury brands still aim to create the best products and services, they are evolving to cater to new lifestyle needs. This requires luxury brands to reinvent their brand values and mission to reflect the changing landscape of luxury. Listed below are some of the important changes to watch for in the luxury industry. Weigh these changes carefully. Incorporate them into your luxury brand strategy.
In terms of global sales, the global luxury market was worth EUR281 billion in 2019, an increase of 4% compared to 2018. The fastest-growing luxury brand in 2018 was Gucci, with a revenue increase of 36.9%. Interbrand, Dior, and Louis Vuitton were among the brands that experienced the second largest growth in brand value in 2018.
To remain competitive, luxury brands must ensure complete authenticity and an element of rarity or exclusivity. They must offer the perfect experience. Luxury marketers must dig deep to find authentic proof points of the brand, starting from its origins. They must also consider how the brand is positioned among competitors. After identifying authentic proof points, luxury brands should consider how to cater to the expectations and needs of Millennials. The following are some of the key changes that luxury brands should consider in 2018.
Accessibility is a key factor
While brands that are accessible to consumers have a higher price point, they aren’t necessarily cheap. In the current retail environment, accessible luxury requires brands to balance a desire for growth with price points that aren’t dirt cheap. Luxury brands like Michael Kors and Kate Spade have to walk a tightrope between affordable prices and growth. And if the market is anything like the one in China, the luxury market isn’t going to stay stagnant forever.
As a way to attract more consumers, luxury brands are making their products accessible for those with disabilities. While the ADA requires retailers to provide access to people with disabilities, many of the changes made by recent events have made shopping online more difficult for those with disabilities. According to a Click Away Pound study conducted in 2016, only 7% of people with disabilities contacted customer service and only 15% contacted friends for assistance. Instead, the vast majority of people with disabilities would simply surf to another site.
Luxury brands that are accessible for customers are using digital innovation and social media to reach a wider audience. In China, accessible luxury brands are using digital innovations and new social platforms to expand their reach. While true luxury brands may still show restraint, accessible brands are embracing digital innovations and experimenting with new social platforms. For example, the launch of a new luxury watch brand on Douyin in 2017 led to the first partnership between two luxury brands.