MILLENNIALS: HOW THEY ARE REDEFINING THE LUXURY LAWS
28 September 2020
Think of high-end streetwear and collaborations like LV x Supreme or Dior x Air Jordan, think of the booming second-hand lux market and of a profound interest in sustainable issues. These trends characterize Millennials and their luxury buying behaviour.
But who are they?
But who are they?
Millennials are the new fashionistas: they want to use their time effectively, live a true shopping experience and receive specialty service at the same time. Quality and status are not enough to please them. They want to be a part of a community that shares values.
Differently from previous generations, Millennials are born in a technological environment that keeps creating different expectations towards what high-end brands should do and deliver to satisfy their new needs. The reason for it is not only that individuals enter a more financially comfortable stage and begin to tend towards luxury consumption, but also the differences in the perception of the concept of luxury.
Millennials pursue self-expression through their branded items and experiences in a way that can be visually shared on social media to point out their individuality. They cherish the real value of a product beyond its price which led to the “pre-loved” market soaring outstandingly through online resellers like Vestiaire Collective and Fashionphile.This system allows them to give new life to items that would have been thrown away, confirming how sustainability became another relevant buying parameter.
“Younger generations bigger sellers, older generations bigger buyers” (BCG&Altagamma, 2019)
The global luxury market is predicted to top €1.3 trillion by 2025 with experiential luxury growing about 5%, far faster than personal luxury at 3%. Therefore, firms will have to move to more accessible products categories in order to gain this rise and to focus more on these generations that by 2025 will account for 50% of the market.
To please the new category, brands have understood the power of social media in brand awareness. A significant amount of time is spent on mobiles which make Millenials even more sensitive to advertising on these channels. Companies are challenged to find ways to create this experience which is characteristic of the luxury industry on virtual platforms.
Millennials also want brands to resonate better with their values. For instance in China, Millennials did not buy Prada bags until they understood what Prada was standing for. (Jing Daily).
Prada x Adidas, “Once you see how the Pradidas Superstar is created, it's easier to grasp how an adidas Superstar can come with a $500 price tag” (High Snobiety, 2020)
As a result, collaborations between high-end and unconventional designers proliferated. The most recent examples include Prada x Adidas, Dior x Air Jordan and Fendi x Fila (less recent examples include Supreme x LV, Nicki Minaj x Fendi and all the H&M collaborations with high-end designers ). This shows their preference for “mixing-and-matching and purchasing high-low”. Premium fashion, niche and sports brands gained their momentum thanks to this trend.
According to a UBS research, Louis Vuitton is a Millennial's favorite. In 2017 Millennials made a third of the LV’s sales. LV then hired Virgil Abloh, a well-known name among millennials with his Off-White brand, as its new creative designer. The French brand has also introduced funky and appealing-to-millennials pop-up stores and an exhibition named “Louis Vuitton X”.
Their video game for their A/W 2019 menswear campaign is a must-watch.
Louis Vuitton retro-style game called Endless runner, inspired by Virgil Abloh’s A/W show for the brand.
The visuals for the game were inspired by 1980s graphics and revisits the New York City streetscape set that was built as part of Abloh's vision for the show earlier this year, where the designer recreated a corner of the city in the Jardin des Tuileries in Paris. (MaffTV)
At younger stages, Millennials mainly buy luxury products to gain prestige and status to display on social media.
As the years go by, criteria change and grow based on quality or elegance, as status is not the main element they look for anymore. They become more careful towards the message they send the world; this includes more conscious and true-to-self purchases, that are less influenced by the popular luxury figures.
With the change in consumer profiles, consumption habits changed as well. This led to the concept of"new luxury consumers" which includes democratization of luxury and a revised interest for experiences rather than objects only.
Instead of referring to a “millennial customer” per se, they rather represent a customer segment that brands need to keep a close eye to.
REFERENCES
BCG & Altagamma (2019). 2019 True-Luxury Global Consumer Insight http://media-publications.bcg.com/france/True-Luxury%20Global%20Consumer%20Insight%202019%20-%20Plenary%20-%20vMedia.pdf
Pamela N. Danziger (2019). 3 Ways Millennials And Gen-Z Consumers Are Radically Transforming The Luxury Market
Crespo Moreno, Loïs (2016). How do Millennials fit in the Luxury Industry? Insight on their Characteristics,
Motivations and Consumption Behavior. http://hdl.handle.net/2078.1/thesis:7178
Daniel Langer (2019). How Millennials and Gen Zers are Forcing Luxury Brands into E-commerce
https://jingdaily.com/how-millennials-and-gen-zers-luxury-brands-e-commerce/
Elizabeth Segran (2019). Inside the luxury industry’s fight for millennials’ hearts, minds, and wallets
Florine Eppe Beauloye. Millennials Definition/ The meaning of Generation Y for Luxury Brands.
https://luxe.digital/business/digital-luxury-speakeasy/millennials/
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