8 Key Luxury Trends
The research revealed luxury consumers now want the latest in technology, sustainability and ethics, hyper experiences, betterment and self actualisation, disruptive collaboration, true individualism, rarity and legacy in their retail experience.
That’s a long list of demands – however the research also confirmed not all of these trends need to be present in a single luxury purchase experience, but those that are present need to be perfected.
Prestige Intelligence is where technology becomes the luxury. Augmented reality, robotics and device personalisation are expected to be introduced to the luxury audience first and the luxury market is responding.
We’ve already seen the Apple with Hermès example, and Luxury wearable enjoyed 60.2% growth over 2015 – 2016.
In this image you can also see how Virtual reality has infiltrated the retail instore experience. It shows augmented and virtual reality being used in Tommy Hilfiger’s Fifth avenue NYC store. The VR headsets allow shoppers to view and shop from the label’s fashion show. This is an indication of what shoppers are going to expect when they walk into a store.
The Transparent Purpose
The transparent purpose trend highlighted how luxury brands should live and breathe responsibility, sustainability, ethics and empathy. This is because it builds trust for luxury consumers.
In essence it’s about honesty, giving back and making the world a better place
68% of consumers are prepared to pay more for products and services from companies committed to a positive social and environmental impact.
Closer to home, we’ve seen already seen this movement with Kering’s 4-year sustainability plan specifically targeting emissions, use of water and ethical sourcing.
79% of prestige consumers would choose a luxury experience over a luxury item.
It’s here the fabulous term “sensploration” or the idea a true luxury experience stimulates the senses exists. Also the notion money can buy what money can’t buy is taking luxury to the next level.
While this statement sounds like the impossible, the following example makes it easy to understand.
In this image you see someone standing inside a dormant volcano. This is where the Secret Solstice festival in Iceland takes place. A $1million dollar ticket buys you and 5 friends a ride in a private jet to the week long festival based inside this dormant volcano, including luxury experiences like helicopter rides to the lowest point inside the volcano.This is what money can buy what money can’t buy means.
The Transcendent Self
This trend speaks to the luxury of betterment and self-actualisation.
Self-improvement is the new black. Today 94% of millennials, 84% of Baby Boomers and 81% of Gen Xers say they regularly seek new ways to better themselves.
Self-improvement luxury is now largely about status, and it’s Millennials who are driving it.
An example of this trend is the Mandarin Oriental Barcelona’s luxury offering for those running in the Barcelona Marathon. Their Marathon Package included a personal coach to assist with optimal stretching, a preview of the final three miles of the course to allow competitors to visualise completing the marathon and finally spa treatments to soothe not only muscles but regenerate the mind.
This trend capitalises on the emotional investment luxury consumers have with brands, often through bold – and risky – collaborations
Collaborations, whether product or artistic, will be key in the next five years. Such co-creation can change the way consumers view your brand and we’ve seen the most outrageous collaborations have the greatest impact.
For example, Dolce & Gabbana’s limited-edition line of fridges for Smeg inspired by medieval art and their native Sicily. These standout designs elevated both brands to a higher level.
True Individualism is shifting luxury away from personalisation to individualisation
86% of prestige consumers believe luxury is in the eye of the beholder. So if they’re searching for more individuality and originality, they want to somehow distinguish themselves from others. To become unique, many are looking for individualised products and services, particularly for distinction in niches.
An example of this trend is Heston Blumenthal’s Fat Duck. He asked diners to submit information about themselves during the booking. The menu then became a map of the diner’s journey which revolved around childhood feelings, adventure, discovery and curiosity. Each dish was personalised to the individual and diners walked away with lifelong memories of a truly individualised experience.
With consumers saying 30% of luxury brands are at risk of “losing their exclusivity”, this trend is seeing the return of rarity to centre stage.
The clearest breakdown of modern luxury is what lies between true luxury and mass luxury.
While the market will always benefit from both groups of consumers, it is the opportunity to reclaim luxury as something rare.
The trend has seen brands removing labels such as Tom Ford’s discreet Private Blend fragrance collection. There are the brands who have no need for a logo like Bottega Veneta’s bags. Anti-branding creates its own exclusivity, appealing to a select group of people who are very luxury oriented and appreciate minimalism. So too is Moet & Chandon’s pioneering blend of Grand Cru vintage champagne into still wine. Turning three vintages of sparkling wine into a blend of still wine is extremely rare because of the difficulty and the expense in getting it right.
The Legacy Label
The Legacy Label trend embraces the benefits of storytelling and sharing this throughout the generations.
Luxury goods hold their value and can last a lifetime. As such they offer both a tangible and intangible value to pass down the line.
Generation X, in particular, grasps this value and is driving the shift from tradition to legacy.
They are evaluating luxury products from a future perspective both financially and emotionally.
Particularly in Australia, the current challenge of housing affordability and lack of investable assets for younger generations means the appeal of “investable luxury” is fast growing.
In this respect – Luxury brands are not selling a product. They’re selling a lifestyle, heritage and status, and the product is rarely the focus of the story, which is why authenticity is critical.
A great example is the watch industry – with luxury watches being handed down to younger generations and gaining value along the way.
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