White tablecloths, impeccable manners, formal conversations and entertainment accessible only to the wealthy.
“This approach to luxury has been outlived,” says a charming member of generation Y and forces even luxury brands like Gucci or Tiffany & Co to fundamentally reformulate their communication and marketing strategies.
Generation Y, born between 1982 and 2002, has become less trustful of advertising, highly engaging with social networks, and shopping online rather than in physical stores. Nowadays, these people have one of the highest purchasing powers of all age groups, accounting for as much as 30 per cent of luxury purchases. This number is escalating each year and it is clear that the companies, which strive to get a share of the profits, can no longer afford to ignore millennials.
Emotion – highest priority
Most of the luxury items can be categorised into the following business areas: jewellery, fashion, cars, watches, airlines, hotels and alcohol. In most cases, these are not necessities. Yet, as fashion icon Coco Chanel once stated: “luxury is a necessity that begins where necessity ends.” As it happens, a good quality wallet can be found for a dozen euros, but those with greater financial freedom will often prefer their favourite brand. Why? Many would say – for quality. Yes, quality is one component, but often more important is the emotion evoked – the sense of luxury.
The emotional dimension, of course, is created by nothing more than communication. Therefore, in order to develop a business specialising in luxury goods, the marketing and public relations strategy as well as the brand image must meet several criteria.
– In the luxury goods category, quality alone is not enough; it requires exceptional craftsmanship and effective communication. It can be produced from high-quality materials, using exclusive techniques, hard labour – anything that adds weight and creates a wow effect, as seen from Swiss watchmaker “Omega”. There is no shortage of quality watch manufacturers in the world, but Omega offers a replica of the watch first worn by an astronaut walking on the moon during the Apollo 11 mission and who wouldn’t want an accessory with such great historical significance?
Truthfully, in the past, the details of how one or another product was produced, where the materials were shipped from, remained behind the scenes of the business and consumers saw solely the product itself. Today, business are more open to sharing how they operate both via social networks and in the media. Note that perhaps one component of your business may already have a distinctive character and history.
– In this day and age, businesses cannot expect to be charming in of itself, simply because it sells quality items or services. In addition, it has to address the context of space and time, and contribute to a positive change in the world. Sustainability, cherished values, meaning – these are the matters the buyer expects and constantly asks himself: What will this thing tell the public about me and my lifestyle? Here, the product not only fulfils its direct purpose, but also acts as a communication tool for others whilst creating its image. With this in mind, luxury brands are also active via social networks. More and more fashion houses are refusing to use real fur, lighter manufacturer Zippo is launching a “Fight fire with fire” campaign to replicate scorched trees in Madagascar and Fendi has invested over $ 2 million in restoring Trevi and other fountains in Rome.
– Businesses must have an authentic (ideally, long-lived) history. Studies found that the greater and more authentic history of the brand, the more consumers perceive it as a luxury brand. Such a factor, by its very nature, asserts the importance of heritage, tradition, past, speaks of the desires fulfilled with excellence. Examples include companies like Hermes, Louis Vuitton, Aston Martin. Explore their brand history. It is often in such stories that exceptional personalities are born, attracting consumers with their charisma and intriguing details.
– Exclusive Privileges. In the past, some banquets and exclusive events used to be a privilege of the rich. Only a certain class of people gathered. Today, the division is declining. The rich go to all sorts of events and buy a variety of goods, but they still want exclusive privileges. Those who want to attract such customers need to pay attention and try to create a sense of exclusivity with VIP services: a separate entrance or exclusive access to limited edition products.
– Service personalisation. Nowadays, the younger generation is less and less concerned with formal matters, with an increasing focus on how the service is tailored to them and the type of personal relationship that is being established. Consumers long for closeness and seek a more personal relationship. This demand is perfectly met by the Marriott hotel chain. The hotel staff strives to get acquainted with their customers before arrival: enquiring where they will come from, where they will go, what their needs and desires are, and tailors them accordingly. After all, is it not true that a person’s expectations on a business trip and during a family vacation are different? Although these are small details at first glance, you always need to take that extra step in order to leave a good impression: to know where cafes and restaurants are located, potentially relevant to your prospective guest, how to get to where you need to be, where your flight terminals are, and recommend even competitor services if you can’t provide it yourself. Such hospitality creates an experience that is essentially marketed as a luxury service.
– Focus on social networking and ecommerce. The service of luxury brands in physical stores should be impeccable and the customer should feel the shopping experience with all their senses. These days, this needs to be transferred to ecommerce as well. The entire site should be user friendly, easy to use, tailored to the customer’s needs, and the communication between consumers and retailers should occur in real time. It is likewise important to pay attention to influencers, taking note that they must be representative of corporate values. While many may find this technique to be too massively popularised, nonetheless, if even the fashion giant Louis Vuitton has begun partnering with Italian social networking star Chiara Ferragni, the move will be a success, however it’s important to choose carefully.
As society changes, so does the concept of luxury. Young generations are coming to the world with their own insights and even the biggest companies cannot ignore them – they have a huge direct impact not only on marketing strategies but also on sales prospects. So keeping a company flourishing or introducing a new product to the market will require the provision of context, the ability to withstand competition, requires attention to the finest details and a strive to create a customer experience that exceeds expectations.