World Luxury Tracking - Acceleration, Transformation, Adaptation: Time for Individuality!
The most recent wave focused on six markets – China, Hong Kong, South Korea, Thailand, Brazil and Russia – and identified four major consumer expectations.
UNIQUENESS: back to basics
Over the last few years, there has been market saturation due to mass strategies and luxury brands racing to occupy the field.
Today, consumers expect exclusivity and customisation through authentic, high-quality products. 90% of respondents (+3 pts vs. 2014) said that luxury brands should "first and foremost offer products of superior quality". In addition, 79% said the ability to customise products is important. This expectation is particularly high in China and Thailand, with 90% and 88% respectively.
Brands should showcase their history, heritage and know-how. They should prove that their products are exceptional and work on this notion of exclusivity.
Including in the affordable luxury segment (Spade, Mansur Gavriel and A-Esque), some brands have built their identity around quality and exclusivity (a limited number of flagship models sold on the Internet) as well as strong storytelling.
ADVENTUROUSNESS: offering an unforgettable experience
Ownership is no longer a major driver for the purchasing of luxury products. Consumers want to dream and escape. 76% of respondents said that when they buy a luxury brand, they are seeking "an unforgettable experience" (+6 pts vs. 2008). Once again, this expectation is particularly strong in China and Thailand (90% and 93%). There has been a gradual change in mentalities largely influenced by the Millennials generation who represents the majority of luxury fans in China – most of whom are male – according to our study.
This hope of having an experience revolves around exceptional service, where all the senses are stimulated: 88% (+2 pts vs. 2014) consider that to remain or become their favourite luxury brand, it is essential to improve the level of service provided. Dior understood this when it opened its first Café in Seoul in partnership with Pierre Hermé.
Brands are also turning elsewhere to find ways of standing out and are opening up to other territories, for example with Louis Vuitton taking over Le Printemps around the theme of galactic travelling and with Chanel linking "Cocobots" on the runway to the world of data.
SEAMLESSNESS: facilitating contact and creating a smooth buying experience
While the purchasing process should be an unforgettable adventure, it should nonetheless remain as smooth and easy as possible.
The e-commerce strategies of luxury brands must be optimised to provide a seamless buying experience. Direct-purchase functions (through social media, partnerships, etc.) should be developed and e-commerce platforms should be improved. 41% of respondents buy luxury goods online but only 54% of them are satisfied with their experience, versus 80% in stores.
In addition, wait times are no longer acceptable and should be minimised. New approaches adopted by brands such as Burberry, which makes its collections available at the end of each fashion show, correspond to this quest for seamlessness.
THOUGHTFULNESS: demonstrating consideration and visionary expertise
Consumers are now turning more to smart, inspiring luxury. Luxury is being perceived less and less as a "sign of social success". Even though this description was named by 74% of respondents, it dropped 5 points on average compared to 2008, and more in Korea (-11 pts) and Brazil (-12 pts).
Today, consumers expect luxury brands to be more ethical and attentive to their needs. This is reflected in particular in the creation of discussion forums between consumers and experts (Armani with its Tweet Talks and Vogue with its Fashion Festival).
There is an expectation for these brands to be more innovative: 75% of respondents (+3 pts vs. 2008) want "creative and bold products". This is very high in China (89%), Russia (87%) and Thailand (90%).
"The rapid maturation of markets, in particular the growth of China since the last wave of the study, is especially noteworthy. While appetite for luxury and attachment to brands remain essential, the values associated with the consumption of luxury goods have significantly changed with the clear influence of the Millennials. This accelerated maturation is providing brands with more opportunities and also means they are subject to many more requirements (relating to transparency, quality, experience, services, cultural openness, etc.)" affirms Françoise Hernaez Fourrier, Ipsos Connect, who manages this study.
