October 16, 2018
By Piers Fawkes
Brands seeking to reach the new luxury shopper need to focus on strategies that define purpose and partner around their consumers’ lifestyle needs.
Consumers have changed. They demand more personalized attention and care more about self-expression than status.
For the new luxury buyer, exclusive experiences trump material goods and when they do buy something tangible, they value conscious consumption.
To be successful in today’s competitive marketplace, brands must engage consumers differently at every touch point. This requires developing a closer relationship between senior decision makers, product teams and marketing departments to craft a unified luxury experience.
The following three strategies can help companies transform their brands and redefine how they connect with the modern consumer across their lifecycle, spanning pre- and post-purchase, and building long-term loyalty.
Step one: Project a personality to build connection
To love your brand and its products, consumers need to understand its personality, its products and its purpose.
It is important to share the processes behind your products and services to connect directly with consumers who value ethics, craftsmanship and quality.
Ensuring a standard of authenticity and transparency in all communications builds brand trust. Commit to being a force for good by exposing consumers to change-making initiatives and inspirational content.
A recent campaign added to the topical conversation around inclusivity by challenging the narrow definition of masculinity:
Menswear retailer Bonobos’s initiative #EvolveTheDefinition aimed to rewrite the definition of traditional masculinity. The project, which kicked off with an advertisement during the ESPY Awards, featured interviews with dozens of men of different sizes and backgrounds speaking about what being a man means to them. The brand hopes to create a more diverse, inclusive and accepting representation of masculinity.
The three-striped sportswear brand furthered collaboration with ocean-plastics activists Parley through community running events and $1 million donations per million miles covered:
For World Ocean Month, sportswear company Adidas aimed to involve the running community in its efforts to end marine plastic pollution by teaming up with nonprofit Parley for the Oceans. Adidas donated $1 for every kilometer logged through its Runtastic application as a way to spread awareness about the importance ocean conservation and to engage the running community in its efforts. Adidas also collaborated with Parley on sneakers made from marine plastic, and estimate they will sell 5 million pairs in 2018.
How to apply to your business
Step two: Create an added-value ecosystem
Your customers are more than just a consumer of your products and services. Understand their personalities, lifestyles and passions to create more meaningful value and integrate your brand more intimately into their daily lives.
Extend your engagement beyond the point of transaction to offer ownership experiences such as product support, partner services, education and convenient renewal.
Design services that meet customers where they are and integrate into their daily lives, providing solutions that not only save time but also elevate time
How this manifests:
At the British premium-tier department store, in-store stylists offer expertise and style advice through a special app. They can also send photos and videos to online customers from the shop floor:
British luxury department store Harvey Nichols has unveiled a new platform called AskHN that lets online shoppers connect directly with in-store associates when they need guidance.
Shoppers can tap the “Hero” button on the retailer’s Web site to initiate a chat, which will automatically connect them to the best available associate for assistance, usually in the nearest store. Shoppers can get styling advice, such as how to get the most out of their favorite pieces or what to wear for a job interview, as well as beauty and food advice.
The in-store team sends pictures, live streams from the shop floor and sends product recommendations.
Roll-out of small-format neighborhood stores provides services, not inventory:
Department store chain Nordstrom launched a series of small-format retail hubs that carry no inventory, only services. These Nordstrom Local hubs look nothing like the retailer’s traditional stores and are service-oriented, bringing Nordstrom’s services to the neighborhoods where customers live and work. Customers can pick up their online orders, size a tux, enjoy a styling service, do some work at a communal table, and get a manicure all under the roof of an airy, well-designed and conveniently located Nordstrom Local.
How to apply:
New vehicle subscription service removes the hassles of car ownership:
Polestar, Volvo’s new performance brand, is luring customers toward its offerings with its Care by Volvo program, an almost all-inclusive service where customers can pay a monthly payment that includes the car lease, insurance, wear and tear, and roadside assistance.
AI uses beacon tech to learn gym-goer habits and adapts recommended routines to keep them engaged:
The luxury gym brand Equinox trialed a bot embedded into its mobile app that learns from a user’s activities, goals and preferences to recommend personalized workouts. The “Digital Coach” uses data from in-gym beacons to detect where gym-goers prefer to spend their time and subsequently nudge them towards specific activities. The service has successfully motivated members to check in 40 percent more than non-users during a six-month pilot program.
How to apply:
Step three: Activate audiences
Consumers want more than a conversation — they want part of the action. They view brands as a valuable resource and seek opportunities to collaborate.
Brands can act as both a partner and a platform, offering access to programs, initiatives and tools that allow consumers to connect and participate. These efforts can spark a halo effect that elevates the brand and the broader community.
Curate experiences that customers will want to share to increase their social status, while amplifying the brand’s reach and currency.
Whimsical pop-up shop in London department store gave shoppers a one-of-a-kind experience that they can share on social media:
Luxury fashion brand Fendi created a whimsical pop-up shop inside London department store Selfridges designed to evoke the feeling of a Roman piazza and give shoppers a one-of-a-kind experience that they can share on social media.
In addition to exclusive merchandise, the pop-up also featured a stand with gelato adorned with the brand’s logo, a retro photo booth and an in-store professional calligrapher who could create and customize postcards that guests can send from the shop.
Another booth offered "balloon drops," with special-edition Fendi balloons freely distributed in limited quantities twice a day.
Experiential furniture showroom lets shoppers make their own viral GIFs:
Burrow, a direct-to-consumer luxury furniture brand, opened its first standalone store in New York. At Burrow House, visitors can hang out in front of a fireplace, watch movies in a private screening room or enter a green-screen studio and create their own videos to share in a green screen studio.
How to apply:
ULTIMATELY, SUCCESSFUL PREMIUM and luxury brands will need to stand for something.
These marketers will need to be able to listen and respond to the community in real time and learn to provide value through an ecosystem of products, services and partners.