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31 October 2018

Millennials are the Big Spenders When it Comes to Luxury

Millennials have bought into the luxury market in a huge way but under their own terms. Unlike earlier generations, Millennials do not see luxury as a way to exclude others: they want to purchase items that include different lifestyles and social groups. Born in the 80s and 90s, they have come a long way from big hair and outrageous shoulder pads. To tap this market, manufacturers and retailers of luxury goods need to embrace new ways of attracting this particular market.

Experience-focused Sales

Experts agree that millennials are interested in the experience of luxury ownership. They like how an object makes them feel and enhances their daily experience. For instance, they don't need a fancy analog watch, but they enjoy owning a rare model that makes them feel unique and special on a daily basis.

Even iconic brands like Burberry have adjusted their advertising pitch to appeal to millennials. One of the most recent ads for Burberry Her perfume is of a trend-setting Londoner with dark-rooted blonde hair posing in a series of shots definitely not aimed at baby boomers. They have also enlisted Chinese rapper Kris Wu as a brand ambassador, something they would not have done twenty years ago. In this way, Burberry is selling quality as an experience, which appeals to those in their 20s and 30s.

Millennial Advertising

This generation of buyers cannot be reached by using only traditional advertising methods. They cut their teeth on the internet and social media, so luxury brands have to embrace these all-inclusive methods to reach their consumers. While not every luxury brand is worn by a majority of buyers, they still must use the communication modes of the masses if they want to reach their buyers. Of course, they can finely tune their efforts to reach the highest numbers possible of the right economic group, but the focus should be on clearly defining their brand and making it aspirational. That means they should be using Instagram, Twitter, Facebook, and all the usual suspects to reach millennial consumers.

Authenticity Needs

This generation prizes the quality and exclusivity of luxury items, so they will simply not tolerate counterfeit goods. And while manufacturers are certainly fighting against deceptive replicas, the danger is that a consumer angry at being deceived by a counterfeiter will transfer their frustration to the brand. That is one reason luxury brands are investing in better security measures than ever before.

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Technology companies like Certilogo work with luxury brands to make it nearly impossible for counterfeiters to pass off replica goods as the real thing. It works by adding a specially coded tag or sticker to the authentic brand products as they are manufactured so consumers can go online and confirm they are the real thing. Companies like Versace and Armani now use this technology to protect themselves and their customers from the onslaught of fake items. This type of security measure is ideal for millennials who appreciate brand authenticity and all things digital.

Millennials have grown up and are now interested in luxury goods. They are a major consumer group yearning for a new “democratic exclusivity” and are willing to pay for it. This group yearns for an experience and not just an item. The foundation of this experience is being part of something true and meaningful, so replica products are particularly offensive to them. Fortunately, advanced security methods exist that can help ensure millennials get what they pay for: quality authentic products.

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