THE PRESTIGE PERSPECTIVE:
Defining consumer luxury trends in 2019
Luxury consumers are spending more – but they are spending by their own rules. It’s a move that can be traced along lines that map the unprecedented rapidity of global and economic changes, as well as a wavering in notions of trust and the relentless march of technological advancement and increased levels of digitisation.
This leading research gives the News Prestige Network the ability to create authentic brand narratives and campaigns that engage with luxury consumers. We share some of this thought leadership document with you on this page, and you can download the full version through the Download White Paper button above.
THE EVOLUTION OF LUXURY
Over the past decade, consumers have become more demanding of the luxury market, with political instability, economic instability, technological impacts and rapid social change resulting in an expedited evolution of the luxury market.
The periods in this evolution do not represent mutually exclusive events. In fact, the trends that have emerged are now combining to result into a far more personal, individualised experience of true luxury where a person’s status is determined by self-actualisation.
The time of “aspirational luxury”.
Subject to moral criticism during economic hardship, conspicuous consumption becomes less conspicuous.
Ultra affluents fuel luxury mini-boom in a post-recession period.
Energised by a movement toward experiences & authenticity
The beginning of the individualised product experience.
Ethically based conspicuous consumption, where the highest quality, design & experience meet the most unique & creative technological advancements. Status achieved through self actualisation as a luxury experience.
It is now the more intrinsic values, such as time, value, experience and personalisation that are driving luxury purchases today. Consumers explore more, researching a product both online, instore and through social groups before making a purchase.
We’re making ethically based choices, demanding the highest quality, design and experiences and the most unique and creative tech advancements. And for that reason, we’re calling this the era of true LUXURY ON DEMAND.
Sources: New Insights on Luxury & Luxury Consumers. IPSOS Media CT Luxury Insights Summit. April 29, 2015, How the Modern Consumer Is Changing the Meaning of Luxury. JCK. May 9, 2016, Tradition and heritage trump hip and new for luxury brand appeal: Ipsos. Luxury Daily. December 7, 2016, What is Luxury…In the Age of You? Brand Quarterly. October 12, 2015
the generational influences
The Luxury Substantials – According to Ibisworld, this generation accounts for more than half of Australia’s wealth and 24 per cent of local luxury retail spend
The Luxury Celebrators – Generation X is currently in its ‘Window of Affluence’, with almost 42 per cent of luxury retail revenue coming from the 35–54 age group
The Luxury Reinventors – Millennials are increasing their share of the global luxury market, accounting for over a third of luxury retail revenue (in conjunction with the younger Generation Z)
The Luxury Redefiners In considering the evolution of the luxury market, it’s necessary to understand the ‘birth’ of Generation Z and the quick-step of its influence over purchase decisions now and well into the future.
8 KEY TRENDS DRIVING LUXURY today
There are 8 key luxury trends that have been identified within our white paper research. While luxury is still about status, in this new world, luxury consumers want to “be” rather than “have” because it is less about what someone owns and more about who someone is. These 8 trends demonstrate how this translates to luxury products and experiences.
Luxury brands today must live and breathe responsibility, sustainability, ethics and empathy. 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.
Where personal brand immersion and sensploration takes luxury to the next level. It’s here that “sensploration” or, the notion that money can buy what money can’t buy is taking luxury to the next level.
79% of prestige consumers would choose a luxury experience over a luxury item. From a societal point of view, we are witnessing the pendulum swing from the concept of ownership to experience, and as such, luxury is now central to the experience that a product can deliver.
Where technology becomes the luxury. No longer is the luxury market lagging in technological advancement, it is leading it. Quite simply, luxury has firmly stamped its logo onto tech. We’ve seen the Apple with Hermès example, but we can expect to see luxury travel goods incorporate inspired functionality such as fingerprint locking, built-in global-tracking, Bluetooth speakers and even Wi-Fi hotspots – as luxury goods and high-end travel go hand in hand, this is an obvious match made in heaven.
The luxury of betterment and self-actualisation.
Self-improvement is the new black as 94% of millennials, 84% of Baby Boomers and 81% of Gen Xers say they are regularly seek new ways to better themselves. Self-improvement luxury is now largely about status, and it’s Millennials who are driving it.
Capitalising on the emotional investment luxury consumers have with brands through often bold (and risky) collaborations. Collaborations, whether product or artistic, will be key in the next five years, with co-creation changing the way consumers will view your brand – we’ve seen the most outrageous collaborations, have real impact.
The luxury of betterment and self-actualisation.
86% of prestige consumers say luxury is in the eye of the beholder. So, when searching for more individuality and originality, everyone wants to distinguish themselves from others somehow. To become unique, many are looking for individualised products and services, particularly for distinction in niches.
With consumers saying that 30% of luxury brands are at risk of “losing their exclusivity” this trend is seeing the return of rarity to centre stage. Perhaps the clearest breakdown of modern luxury today 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 tangible and intangible value a luxury item holds for future generations. Luxury goods hold their value and can last a lifetime and as such 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. In doing so they are evaluating luxury products from a future perspective both financially and emotionally.