The ages of high-end luxury consumption are no longer what they used to be. Brands are going after increasingly younger customers, outlining different generational approach strategies that play more and more with emotionality and awareness of their infidelity. And to do this, they are changing face, becoming media companies
Every newborn baby is a new consumer and part of the Alpha Generation, which identifies those born in the 2010/2020 decade. Until a few years ago, it was not so important to classify an individual in generational terms, but, although the world birth rate is constantly falling (even in Beijing), with the advent of social media and the imposition of Chinese consumers on the market, perspectives have changed.
The pandemic and the impossibility of travelling have made local consumption more strategic than ever. Moral: fashion and luxury must necessarily capture, with diversified strategies, not only the (more) young but must find a way to do it at home. The challenge for the fashion system is therefore increasingly generational: how to understand the new consumer demographics? How to intercept them? How to satisfy them?
The generational challenge of luxury
The generational issue is high on the agendas of all luxury CEOs. They all chase the portfolio of so-called young people, even though they are aware of their high level of infidelity. In other words, they easily move from one brand to another.
Hence the sociological need to think in terms of (new) generations. Today, there are two generations around which the market is polarising: Generation Zeta (aged between 9 and 24) and Generation Y or Millennials, aged between 25 and 40. So, at least in part, already quite old or, if you like, differently young.
Y and Z
According to the latest report by Bain & Company, produced in partnership with Altagamma, Gen Z will increase its weight in global luxury consumption from 8% in 2019 to 20% in 2025. Over the same period, Gen Y will grow from 36% to 50%. “There has been a transfer of wealth from older generations to Gen Z and Millennials – says Claudia D’Arpizio, partner at Bain & Company and co-author of the report -. Not only in Asia, but also in the United States. We are therefore witnessing an acceleration of the entry of new generations, accentuated by the pandemic“. New generations, by the way, are more inclined to buy online.
Tell me how you choose, I’ll tell you how old you are
How do these consumers choose which product to buy? No longer based on the logo (understood as a status symbol), but on the values it conveys. These changes have also modified the graphic representation of the market and the different dimensions of luxury. Do you know the traditional hourglass shape? Forget it. Erase it.
In its place, you have to imagine a sort of rugby ball with fluid contours, where customers enter and exit along its perimeter, explains Bain. In such a context, price and product categories are no longer as important as they were 20 years ago. The functionality of the product has taken second place in the emotion it arouses. So companies are adapting.
They focus on content and become media companies. In other words: ‘multimedia companies capable of moving values in civil society, with an almost political role‘, observes D’Arpizio. A new generation luxury for new generations of consumers. Increasingly young.