Brand loyalty is waning among affluent shoppers. 56% find themselves less loyal to brands than in previous years. As consumers redefine luxury, brands need to move beyond marketing based on the traditional standards of prestige in order to retain them. We’ll share some tips on how you can reinvent your luxury brand to appeal to today’s affluent population.
Connect With Young Affluent Consumers
Speaking directly to young affluent consumers will go a long way toward fostering loyalty. Generations Y and Z accounted for 47% of luxury consumers in 2018 and will represent 55% of the luxury market in 2020. Retaining this segment of consumers is key to continued business growth. Read on for some key strategies on how to engage this segment.
Engage on Social Media: While the mass appeal of social media doesn’t intuitively flow with the idea of a luxury audience, 95% of Gen Z luxury consumers indeed use social media to interact with their favorite brands. Create social media content and campaigns focusing on themes like aspiration (rather than accessibility) to maintain an air of exclusivity. Work with influencers to shape their buying decisions, and leverage social commerce features such as shoppable posts and Instagram Checkout for a frictionless shopping experience.
Sustainability: 64% of Gen Z luxury consumers are influenced by sustainability ethos. Use responsibly sourced and eco-friendly materials, highlighting their use in your marketing and emphasizing your efforts to lessen the environmental impact of your production. Prove you take environmentalism seriously by publishing a sustainability report.
Promote Individuality: Modern luxury consumers seek products that convey their unique personality. Allow consumers to personalize products through an in-store customization kiosk where they can work with a craftsman to create their preferred design. Consider building an online personalization platform so consumers can customize products themselves and see what the final product will look like as they make their selections.
Invest in Collaborations
In today’s fast-moving world, innovation is key to remaining relevant and building customer loyalty. One way to encourage innovation is through collaboration. Collaborations also increase brand awareness and the likelihood of luxury consumers to purchase. Consider these tips when planning your collaboration strategy:
Partner with Brands: To stand out and strengthen your brand appeal, focus on partnerships that are unusual and surprising. Two years ago, luxury brand Louis Vuitton and streetwear brand Supreme released a series of limited-edition apparel and accessories.
To avoid brand dilution and ensure mutual profitability from the partnership, collaborate with a strong brand. If your audience is comprised of millennials and Gen Z, focus on creating unique experiences by combining streetwear with luxury.
Release Limited Editions: Offer your collaborative products as limited merchandise to create hype, visibility, and urgency. Your limited edition strategy should be driven by a big idea that’s authentic and unique to your brand. For International Women’s Day, Bergdorf Goodman partnered with visual artist Leah Tinari to create a new logo and designs on a set of limited edition products. To maintain exclusivity and control accessibility, place products at selected upscale locations.
Improve the Luxury Digital Buying Experience
38% of luxury spending takes place over the internet, and though most luxury brands are online, the experience is far from what many consumers are used to. The right digital strategy differs for every brand – but here are three universal strategies for delivering an effective digital experience that’ll maintain your brand’s prestige:
Website Personalization: 45% of luxury shoppers want more personalized products and services. Provide localized websites for each country you serve, create a personalized style guide to help with sizing, provide an online expert to answer questions, and use artificial intelligence-powered platforms to send personalized recommendations to website visitors.
Mobile App: Design your mobile app for on-the-go shopping by including features such as multiple payment options, synchronized shopping carts, and visual search. Incorporate new technologies like augmented reality to help consumers experience your products.
Omnichannel Experiences: Focus your omnichannel strategy on delivering a differentiated customer experience and allowing consumers to interact with your brand physically and digitally. Key omnichannel services include real-time product availability online and in-store, in-store returns, and click & collect. Cartier offers customers free returns and Buy Online & Pickup in Store services:
Product quality is a key driver of luxury spending, with 88% of consumers stating that they buy luxury products due to their premium quality. Here’s how you can showcase the quality of your products.
Showcase Craftsmanship: Craftsmanship is an important reason why people buy luxury products. Keep the focus on product quality by using one-of-a-kind artwork and strong designs that showcase creativity and technique. Bottega Veneta’s leather bags forgo branding, but they appeal to luxury-oriented consumers who appreciate minimalism.
Offer Handmade Products: For a large number of luxury consumers, handmade equals well-made. Offer bespoke handmade collections or limited-edition products. Radiate authenticity by showing consumers how your products are made.
Provide Particulars: Consumers appreciate information on how and where products are made. Highlight quality by showcasing the materials and the precise methods used in production. Upscale goods company LMVH’s Journées Particulières programme invites luxury buyers to workshops and demonstrations of how luxury products are crafted.
Emotions drive luxury purchases. 59% of affluent consumers are predisposed to purchase from brands with which they have an emotional connection, and 53% will pay more for that connection. Here are a few strategies you can use to build emotional ties to luxury consumers.
Create Experiences: Form an emotional bond with consumers by giving them memorable experiences. Open interactive stores with attractive designs where consumers can have fun, engage with like-minded individuals, and interact with your brand. At the Hermès Carré Club, consumers can watch artists and designers work in an on-set atelier.
Use Storytelling: Brand stories are a great way to connect with your audience. Your stories communicate brand values, heritage, tradition, and craftsmanship. Create relatable content by sharing real stories that put customers front and center.
Nostalgia: Craft a blast from the past campaign to reach your audience on a whimsical level. Use vintage visual and verbal cues to recreate scenes, but don’t be afraid to remix the story. Tiffany and Co’s Believe in Dreams campaign paid homage to the 1961 movie Breakfast at Tiffany’s and featured a modern remake of the classic song Moon River.
Out With the Old
As the meaning of luxury continues to evolve, brands must devise new ways to remain relevant and retain consumers. Embed values like serenity, vitality, and wellness in your offerings to deliver heightened experiences. Maintain exclusiveness by reducing the number of entry-level products you offer, limit sales to a few times per year, and physically distance off-price outlets from city center stores. Above all, remember that today’s luxury shoppers are after the same top quality – with a fresh new twist.