Who are today’s luxury consumers?
The perception of exclusivity is shifting.
By Marta Lobato — Senior Researcher at A Piece of Pie
The first time we were briefed to research “exclusive inclusivity” for a prestigious, global Executive Education School we were puzzled. There was a suspicion that a shift in societal values could be diverting individuals with the means to enjoy top business education to new MBA programmes from newer, more inclusive, and informal-styled schools that may be responding better to the needs and aspirations of current applicants. Since then, the topic has become recurrent in our consultancy firm. After executive education it came the luxury car category, retail, and the hospitality sector. The spotlight is on the shift in affluent consumers’ life priorities.
The question has always been the same; are today’s affluent consumers beginning to act in a way that is different to what the industry has known until now?
At first, we were curious about the apparent contradiction of the two concepts, “exclusive” and “inclusive”, in which we interpreted them to be clear opposites. As research unfolded, however, it became clearer what it meant.
These changes are the result of a myriad of factors colliding in the aftermath of the pandemic, such as millennials craving meaningful work and personal, familial, and societal stories of economic challenges. Although our clients tend to talk about these modern consumers as “new” they aren’t — they’re simply adapting to a society that keeps progressing.
Here are some of the more salient aspects we unveiled from interviews and observations with American, European, and British affluent consumers in the post-COVID world:
- They refrain from formality.
After COVID, deservedness has shifted into a sense of appreciation for one’s privileged position. Excessive formalities in dealing with salespeople, pressure to dress ostentatiously in stores, and treatment based on the amount of money the consumer is willing to spend, are now moving toward a more modern casual, relaxed attitude focused on warm, and informal manners. The modern affluent consumer does not want a salesperson to praise him/her but be an expert who knows the product and the brand in depth and who can deliver a learning experience through compelling storytelling.
The same principles apply to online retail: although the design of the website remains important, they value a user experience that considers the needs of the customer over the flamboyant messaging.
As consumers are turning to digital, the challenge is to design digital shopper journeys that deliver on these changing demands. Today’s affluent consumers want flawless user experiences that are entertaining, with plenty of options to have one-to-one interactions with the brand.
2. They see accessibility as a symbol of brand confidence.
When brands complement their affluent offerings with more affordable products, accessible to the wider population, this is perceived positively by these consumers. Our research showed that a brand does not need to be mysterious to feel exclusive. On the contrary, a brand that openly displays value to the wider public is seen as confident and progressive.
Developing partner ecosystems to bring more value to the public is perceived as innovative and hyper modern. Collaborations bring innovation, new technologies and better solutions. New prestige is perceived as an ability to connect with others for better results.
3. Status isn’t only about access to networks one can capitalize on, but also about self-expression.
Affluent individuals want the world to know that they are not just the product of their wealth, but the result of conscious life choices that reflect on who they are and why they choose to live the way they do. They want a personal narrative of purpose that goes beyond a luxurious lifestyle.
Understanding self-expression in modern times requires knowing their “human story”. Who are they and what are their aspirations? Affluent consumers see great value in brands also re-defining the way they seek purpose, as opposed to sticking to the heritage narrative.
4. They seek everyday experiences.
These consumers look for luxury products that are encoded in a style and design that one must have the cultural knowledge to be able to identify. These affluent consumers take pride in owning non-luxury items that add value to their lives, such as the latest technology and innovative mobility solutions.
Today’s affluent consumers value functional aspects as much as aesthetics and storytelling. They like to focus on everyday value, with things that turn their everyday endeavours into extraordinary experiences.
5. A wink to minimalism or a desire to “cut out the noise”.
Although minimalism and inconspicuous consumption is currently a popular trend among the middle classes, we found that affluent consumers are looking to cut unnecessary noise in their lives. They state that they have too much of everything, leading them to feel overwhelmed at times.
Affluent consumers see value in simple messaging, aesthetics, and services; decluttering as opposed to accumulating. In short, it’s a spiritual call that affluent consumers perceive as a choice; a form of self-reassertion that they, too, could live with less.
What explains this changing behaviour?
We spotted a few key changes that are moving people to behave differently. On the one hand, we’re seeing a re-arrangement of the way time is spent. Devoting more time to the kids and being unable to see the extended family during the pandemic has made parents more aware of the limited family time they enjoyed before the pandemic. There is, therefore, a desire to focus more on building and maintaining the quality of relationships as well as having quiet time for oneself.
Many consumers also embarked in new projects during the pandemic, and these have a more personal purpose attached to them, as opposed to meeting social expectations. A re-evaluation of how one spends time is also uncovering the tensions and contradictions of modern life; there is too much to do, and very little time. As a result, these consumers tend to describe luxury as that which one cannot buy with money, such as quality time.
In short, exclusivity is becoming more abstract and immaterial, personal, and subjective. It’s not something one buys, but something one defines. Today, we know that people are defining exclusivity around personal relationships, purpose, and a vision for the future. These are all important points to consider when wondering what on earth is inclusive exclusivity.
If you’re in the luxury business and you’re wondering how to keep up with the changes, the first step is to get to know your customer very well. Know what recent changes have happened in their lives, how they see the future, and how the pandemic might have re-shaped their priorities and dreams. Who are these so called “new” luxury consumers? What values do they hold? How can your brand remain exclusive while instilling a sense of inclusivity?
At A Piece of Pie, we have the expertise to provide deeper personas that go way beyond demographics by capturing changing attitudes and behaviours through qualitative methods. We are social scientists keenly observing and collecting data that provides our clients with deep knowledge about the changes and challenges ahead, based on what real consumers are not only saying, but also doing.
Drop us an email at info@piecepie.com
