By Jukka Aminoff
I read an interesting article from Business Insider about millennials and what are their attitudes towards luxury. The article said that millennials are interested in social life, travelling, culinary and other issues, and they do not share so much interest in luxury. Does the industry promote vanity in a wrong way? Are millennials and younger generations more spiritual?
However, millennials do own luxury items and creations but their main passions are elsewhere. We must remember that every generation changes their values and tastes during their lifetimes. Hence, consumer behaviour changes constantly. However, the industry must be extremely paranoid all of the time because there should a high desire in every generation. Millennials might have lower-incomes, which affects their desires. But what happens if they do not have any desires when they will have higher incomes? Do they change their buying behaviour towards high-end markets?
Decreased desire is not critical for luxury brands because they have made strategic shifts all of the time to meet consumer expectations. In western countries, millennials are interested in ecological and ethical questions. Sustainability is one of the greatest values, and human rights and animal rights. However, there are also emerging markets, which are very interested in luxury brands, and in these markets, there are different values behind buying luxury products. Developing countries might the best market opportunities. In contrast, developed countries might face tougher times.
Luxury brands do have a competitive edge but they should communicate their values little bit differently. Social media and websites provide excellent communication channels to reach millennials who spend their time online. Therefore, luxury brands should engage in storytelling, and promote their values.
Luxury brands are known for craftsmanship, high-quality raw materials, ecological values because products are long-lasting, creativity, and many other issues. These values should be communicated towards millennials who want to buy meaningful products from brands, which share similar values. These values can be communicated very easily in the digital world.
The article also said that millennials prefer social life, therefore, luxury brands should be like clubs and societies. For instance, Dolce & Gabbana opened a new flagship store in Moscow, Russia, which has its Martini Bar. The bar adds social elements to shopping, and luxury brands are known for their relationships with their clients.
The bar is not enough, and there should be more social elements. The luxury industry does a have bright future ahead, and it will grow in the future because strategic shifts can be done quite easily. I strongly believe that suddenly luxury products will become a megatrend amongst millennials but this requires that there should a higher mental connection between younger generations and the industry. Superficial values do not create interest. The industry is known for meaningless vanity. Hence, a down to earth approach is needed to survive. However, products and services should be stunning as always.