Millennials and Luxury: An Interplay

To start with, who are the millennials? Aren’t they hyped? No! They are the need of the hour. As per Financial Times, they are “the world’s most powerful consumers.”

Luxury brands’ sales are rising. In fact, they are finding an eager and expanding customer base. And the major reason is millennials. They know what’s “cool”. However, there’s more to brands’ success. In general, to win with these consumers, brands need to understand what they value. And that is personal satisfaction and purpose. Because millennials want more than just a brand!

Moreover, marketing to them is different. It is not like marketing to their parents or grandparents. These people are digitals at heart. With many alternatives, they henceforth demand differently. They want better value for their money and greater real-time value. So, this means that brands must cater to this digital trend. This is their hope of attracting their interest.

What goes in it? How does it work? Confused? Don’t worry. Krown Kouture explains the parallels and trends existing.

The Change

Traditionally, “luxury” meant high-quality craftsmanship and exclusivity. A mere show off. However, now in addition to these aspects, it has also taken other meanings.

According to a Deloitte survey, millennials don’t buy these traditional selling points. The survey took place in US, UK, Italy and China. As per findings, “Respondents bought luxury to please themselves, not to impress others.”

Moreover, these individuals crave purpose, authenticity and passion. As a consequence, brands must embrace a higher purpose. All this to win over customers.

A New Model

Brick-and-mortar will always be crucial to luxury. However, the future is online. It is witnessing a rise. Eventually, many brands are building online shopping. All this to reach these consumers in their comfort zone. Deloitte found the sources of a millennial’s knowledge. The knowledge about high-end fashion. 20.5% of them said social media as their main source. Only 15.1% said brands’ websites.

Furthermore, it is crucial not to just try to give the impression of engaging your audience. But, actually engage them. Last but not the least, try to sell experiences.

Cause

A cause is key. Brands must show that they stand for more than just making money. Additionally, promoting sustainability is key. And not ignoring ethical business practices.

Historically, brands were promoting a so-called culture of “exclusion.” This meant there was a lack of connect with the final consumer. Also, a reservation in their communications. Meanwhile, what we are observing today is a new trend. It is to successfully engage them. So, the brands have to act in an inclusive, engaging and open manner.

In reality, this requires a great deal of newness. Particularly, a focus on communications. Additionally, tone of voice and social media behavior as well. The more personal this interaction gets, the more loyalty they show.

There’s a lot to offer. Personalization, customization, monogramming! You name it! And brands have it. However, this should be a continuous process. Creativity should never stop. As you know, selling experience is the new reality.

To-Do’s

Firstly, refresh the brand image. Affluent consumers do not take brand messages for granted. So, brands must learn. They should not present the usual luxury advertisement formats. The best solution is to employ the millennial drive for creation.

Secondly, creating targets. This means that create according to the taste and requirement. Focus on the right audience. As everybody can’t afford to buy high-end products. So, brands need to speak directly to the subset. The interested subset!

Thirdly, accept fans on social media. Brands often enjoy the admiration from fans. But that does not always translate into sales. Eventually, they need to get the most from social media. And brands need to go beyond. To start with, start accepting. All this through a smooth digital experience. At the same time, digital experiences are important to the current purchasing. And luxury brands that neglect these aspects do so at their own risk.

Facts

Custom-made is everything. In the U.S. ~ 3 quarters of millennials would pay a custom-made premium, that rises to 98%.

36% will buy what they like regardless of the brand. 34% consider buying from a few preferred ones. While 22% consider from a wide range. Surprisingly, 8% consider buying from one brand. This means they value own self more than brand loyalty.

So, it is the golden era of luxury!