Mindshare On The Future Of Luxury Marketing: There Is No ‘One Size Fits All’ Approach
Here's what influences different segments of this demographic with significant purchasing power.
Millennials have emerged as a demographic with over $200 billion in purchasing power, but over 55 percent are skeptical of big luxury brands that they believe have “lost their personal feel,” according to new research from Mindshare — indicating that luxury brands may be missing out on significant spending.
There isn’t a one size fits all solution to winning these customers over: It’s impossible to fit all Millennials — or all luxury consumers, for that matter — into one monolithic group. But there are substantial opportunities for luxury brands to use digital means to build better relationships with their customers based on their unique preferences — and to bring new shoppers into the fold as well.
“There are certain aspects that define luxury that won’t change, like scarcity, beauty, history, and more,” said Jodie Huang, Manager, Insights, Mindshare North America, “but brands have to continue to keep up and anticipate changes in consumers’ values, taste, and the speed in which they learn and share information.”
Key takeaways for luxury marketers from Mindshare’s report, The Future Of Luxury Marketing, below:
‘Luxury consumers’ aren’t just one demographic: “Something critical for brands to know about these consumers is that you can’t pigeon-hole all luxury consumers into one group,” Huang said. “As each luxury category has its nuances, so do its consumers. You have to understand fundamentally what needs the brand fulfills and how those needs might change over time. Brands also have to recognize not just the changes with their customer base, but with society as a whole and where the broader group is heading.”
How does Mindshare broadly identify these different types of luxury consumers? As Strivers, who see luxury as evidence of success (24 percent); Trendsetters, who see luxury goods as a way to set themselves apart (16 percent); Aesthetes, who define luxury as the pinnacle of art and design (17 percent); “Only the Best,” who view luxury as unsurpassed quality and service (23 percent); and “Comfort First” customers who see the category as a more comfortable or meaningful way of life (19 percent).
Difference subsets of this consumer group are influenced by different means: Strivers and trendsetters are both primarily influenced to purchase by social media influencers, meaning that it behooves marketers seeking to reach this demographic to explore influencer marketing and expanding these budgets.
Conversely, Aesthetes, “Only the Best,” and Comfort-first shoppers — groups that include more of the over 55 and over 65 demographic, as opposed to Trendsetter millennials — are more likely to be influenced by search, online reviews, and reviews from friends. As such, luxury brands aiming to reach older, more established consumers would do well to pay special attention to review monitoring — as well as the changes in discovery that have been wrought by intelligent search.