Luxury in a Post-Pandemic world
Updated: Mar 18, 2021
Luxury redefined, New Luxury:
The Glow Up [ Luxury Brand Lab ] Manifesto
If over the last decade the definition of luxury progressively shifted from “having” to “being”, in my opinion 2020 definitely made it shift once again from “being” to “doing”. Luxury was already becoming more experiential before the pandemic, and still is, but 2020 took that definition to a whole new level.
Almost overnight, Luxury was no longer about having, but simply about being able to do the things we liked to do pre-covid - and took for granted - and being able to connect and build social experiences from home. And for that, we all had to pivot, brands, companies and individuals.
Today, one year later, everything is more digital & virtual than ever (with the screen fatigue that we begin to experience now - which will force us to pivot once again in the coming weeks or months for sure), Most of the social events in 2020 have happened from people’s homes as we went under lockdowns everywhere. In 2020 we all went through the same steps of excitement, despair, hope. boreness, fatigue and resilience.
At the same time, in the context of 2020, people have had time to reflect, to even slow down sometimes. In only a few weeks, We saw air pollution drop massively as planes were stuck on the ground everywhere - making us realise that with drastic action and alignement at global level, we could still make a difference and solve, maybe, the climate change danger. Also, as no one was travelling anymore, we re-discovered the benefits of local consumption and of nurturing our local community. That made us think. Individuals, companies and brands leaders. How can we make a more positive impact? How can we accelerate maybe? Do we really want to hear the same "Can't do/Not my job" excuse from corporate leaders and governments?
Also, as we were questioning the status quo and imagining a better world and as it became clearer that the pandemic would hit women harder than men and would increase inequalities. D&I became one of the burning issues, along with mental health. Making profit is one thing, but what about social justice? What about sharing, giving back, caring about your community? Realising that everything could disappear overnight and that when forced into change, companies actually could change, people demanded that change. And overnight, please.
”This crisis may be transforming the luxury industry for good, but it could also be a transformation for the good”. - Bain & Company
I remember a quote I read in a Bain & Company report that said “this crisis may be transforming the luxury industry for good, but it could also be a transformation for the good”. The luxury industry has always been a pioneer when it comes to leading the way and questioning itself and I believe it will once again. Sustainability, Purpose and Inclusiveness will be at the heart of the industry - and already are in many companies & Houses. More and more, as Gen Z consumers enter the luxury market, they will demand transparency (think traceability) & sustainability (walk-the-talk approach or nothing), will challenge brands on their values, will request a higher level of service and will call out brands that do not live up to their standards.
Last but not least, following the "first in, first out" logic, China decided that the pandemic was behind and moved to recovery phase before everyone else - giving hope and optimism to hundreds millions of people, creating that now famous revenge spending* effect. In the meantime, youngest generations everywhere were particularly hit, going back to their parents' home, deprived from social life, love life, jobs, and sports clubs & activities - worrying about their future but also deciding to live (and spend) in a very different way from their parents - after all, if one decided to do some sort of performance review of the world they had created, it would not be brilliant.
The luxury retail landscape might change massively.
Credit : NORDSTROM / A store closed under lockdown
Will people return to travel as much or more than before? Or will they shop local more than ever before? Will people keep buying online or will they miss the human interaction too much and will return to the stores? How will the luxury brands encourage and convince their consumers to visit their stores again? How will they deliver the highest level of service, uber-personalised offers in an omnichannel approach? Will they use the most disuptive technologies to do that, or will they go back to a personal, 100% human connection? Or both maybe?
What will happen with retail? With central neighborhoods that used to gather offices, headquarters, luxury stores, restaurants and bars, which, in the context of pandemic, have been deserted by both tourists and locals?
Last but not least, in terms of regions, Asia and the next generation of consumers who will drive the industry’s growth for at least the next 5 to 10 years – with purchases happening more and more locally. But let’s not entirely forget about local customers in other regions… they may surprise the industry positively.
The future of Luxury is bright for those who will adapt
Luxury has always shown some of the best resilience to any crisis. Being mostly an emotionally-driven industry, it tends to be one of the fastest to bounce back when a financial crisis subsides as consumers want to treat themselves with luxury goods and services to celebrate positive life changes.
Also, it has spent decades reinventing itself and thrives in eras of major cultural and societal change. Look at how fast most of the luxury houses have pivoted during the pandemic to accelerate their e-commerce presence.
However, as consumers become more knowledgeable and insightful– for good reasons – they will focus on the meaningful and relevant ones - which might end up with a natural selection in the premiumization horizon.
Credit : Gucci / Off the Grid collection / Gucci.com
The new paradoxes of luxury to address as a brand today
Global vs. "made for me"
Inclusiveness vs. exclusivity
Rarity vs. always-on visibility & omnichannel accessibility
Heritage vs. forward-thinking
Craftmanship vs. technology-driven
Catwalk style vs. street style
new luxury vs. old luxury
What do you think of this statement?
Tiffany’s positioned itself as luxury but 45% of its sales came from products that cost less than $500. A brand cannot be both luxury and within reach.
Sources & Additional reading