With each year comes new trends all throughout varying industries, but the luxury industry is said to be one of the most resilient industries there is. After the crises we have had over the past two years, the global luxury industry has bounced back faster than expected and it is said to return to its historical growth trajectory.
There can be no doubt that the coronavirus pandemic transformed how we live and work; now, more and more people are developing new ways to live their lives, shopping and living, potentially more frugally. A deepened understanding of consumer behaviours creates new imperatives for all luxury brands; they need to be more transparent, engaging and customer-centric organisations.
At Essentia Concierge, we offer unrivalled luxury with our services and fully understand that there are complex challenges to face in the coming months and years within the luxury sector. Our team have put together the trends that will shape the future of luxury and how brands and businesses can stay ahead of them.
Purpose Precedes the Brand
The market has shifted and the acceleration for luxury brands to transform their purpose to push for more sustainability and diversity within our equal society. Since the pandemic, businesses across many sectors have had to shift towards a deeper ‘purpose’ and instil their ‘brand values’ within everything they do and remain central to their customer’s purchase decisions. Going forward and looking into the future, a brand that operates with a heightened value, increased transparency and commitment to customers is more likely to be rewarded with lasting customer loyalty and trust.
The Next Generation of Social Shopping
With the pandemic and multiple lockdowns affecting shopping habits, consumers are now spending more time at home scrolling through social media and discovering new brands to shop from. Online shopping was on the increase before the pandemic, but with the use of social media and the fact we all spent so long at home, the increase is vast. The majority of shoppers are influenced by brands, the term ‘Social Shopping’ has gained a massive following and created a niche for luxury items within apps such as Instagram, TikTok, Youtube and more.
Huge Increase in Luxury Spending
Forecasts showed that the overall luxury market would grow from 13% up to 15% in 2021 to $1.14 trillion, which is higher than in 2019. Items within the luxury market grew enough to exceed their 2019 levels, including cars, luxury goods, fine wines, spirits, and designer furniture. The sales of luxury cars rose to €551 billion, 7% to 9% more than in 2020; luxury hospitality rose to €79 billion, up 20% to 22% from 2020.
Deliberate About Purchasing Luxury Goods
The pandemic saw a profound reset in consumers’ priorities when it comes to luxury items; they are now spending time evaluating what they need versus what they want. Reports show that affluent consumers couldn’t justify buying new clothes or fashion accessories, luxury watches or handbags then they have no place to go or people to meet. The restraint that a lot of people took in 2020 and 2021 could potentially continue within 2022, especially when consumers are cautious about the luxury items they are purchasing.
With the disruption of the pandemic, luxury brands have a purpose of redefining their engagement with consumers and facing a more ‘consumer intimate’ strategy. As luxury brand leaders, we know that staying relevant with our consumers and audience is vital, but with opportunities all around us and align with our consumers’ evolving expectations.