by Benjamin Berghaus and Sophie Schüller
In the past years, the luxury market has changed quite dramatically: where online shopping used to be frowned upon, selling through a multitude of channels has become not only commonplace, but also a key growth driver; where brands were used to aim for an elitist appeal, younger target groups have shifted communication strategies towards unique experiences; where managers of luxury-positioned companies left the impression of floating on a cloud of exclusivity, modern leaders of luxury find a much more balanced approach of confidently presenting great offers and listening to customers and employees of today and tomorrow.
Thus, we find the luxury in the midst of a transformative process – but here, the core change does not revolve around digitalization, automation, or making things smarter, it revolves around the cultural change of what the commercial creation and consumption status will mean tomorrow. First signs show that this new type of status is not as elitist as it used to be. Rather, you might call the new notion of luxury more charismatic: luxury today and tomorrow still carries the complexity of social structure, but in a much more winning and integrative style. This new type of status is not as materialistic as it used to be. Rather, luxury advances to become more experiential: younger consumers both cannot afford the same luxuries as their parents and they also feel like owning luxuries does not fit their lifestyle as it would to have access to them. Finally, this new type of status is not as static as it used to be. Rather, luxury is emerging as a concept that thrives on renewal and reinterpretation both in times of ever-shorter innovation and communication cycles and in times of more an more saturated markets. These three key dimensions, charisma, experiential, and renewal, are only a small selection of changes that the market faces – but they are key to understanding how luxury brands need to change to keep their competitive edge.
In this collection of articles, we brought together students, academics, and practitioners in order to reflect upon the changes that the luxury market faces today and will face down the road. Here, the next generation of luxury consumers and employees, our management students, lead the discussion with a selection of 30 different perspectives upon the market, its presence and future.
We wish you an insightful and inspiring experience when browsing our study as a whole, one or the other article, when following one or the other reference, trail of thought, or idea.
As part of the master course at HSG “Introduction to the Luxury Goods Industry”, around thirty students participated in the trend study as part of their curriculum in this course.
Firstly the three major areas of focus were presented to the students and students had to form six groups, hence two groups per topic. Those groups were then asked to identify major trends in the luxury industry in the area of differentiating experiences, omnichannel experiences and glocal brand management.
After four weeks of research, we organized one workshop per topic, where the groups presented their findings. Each group presented their results in a 10-minute presentation. In a workshop, overlaps of the two groups were identified and some topic were merged. Thereafter, the individuals within the two teams were either teamed up with a person from the other team or were continuing by themselves, further developing their topic and identifying best-practices within the luxury industry. These results were then presented in poster-presentations in the plenum of the entire class, including the lecturers and the initiators of the trend study from the Competence Center for Luxury Management. The presentations were again critically evaluated by peers and supervisors and final advice for the written trend study, content wise and formality wise, were given.
Finally, students documented their findings in a report or wrote general introductions to each of the topics. After having evaluated these reports, only the very best trends and elaborations of these trends were chosen for the report.
Since the course Introduction to the Luxury Goods Industry was taught in German, some of the reports were submitted in German and had to be translated into English. Thereafter, some final copy editing was done in order to correct some formalities, it is thus not the idea to have a trend study, which is completely rewritten by a copy editor in one tone and style, since this piece of work has from the very beginning lived from the diversity of authors and topics and we wanted this to be reflected in this trend study.
Dr. Benjamin Berghaus