A new report by Boston Consulting Group highlights that spending on luxury experiences grew 50% faster than spending on luxury goods. So much for the image of louche starlets eating bon-bons by the pool draped in Ferragamo and doused in Chanel No. 5. It seems that today’s wealthy are more interested in splashing the cash on upscale cooking classes, big game hunting and Himalayan trekking.
At FutureBrand, we’re actively observing how trends such as ‘conscientious consumption’, ‘life-simplification’ and the hyper-speed pace of fashion fads are making people increasingly comfortable with choosing to spend their money on memories rather than merchandise.
The drive to create luxury experiences is certainly nothing new. Over the past decade we’ve witnessed cosmetic brands such as Aveda and La Prairie move into salons and spas whilst fashion brands such as Armani have become hoteliers.
What is new is the extent to which these types of experiences are taking a greater share of the money that’s stashed in those Dunhill wallets and Birkin handbags.
So how do those traditionally ‘tangible’ brands such as jewelers, vintners and prestige automobile manufacturers transform themselves into ‘intangible’ experiences that satiate this growing market demand? The first step is to understand what makes one’s brand special in the first place. Luxury experiences cannot be positioned simply on price, it’s about purpose. The second step is to use this purpose as a platform for relationship building, not just transactions.
To activate their brand, companies need a strategy and design partner that can think in 3D experiences, not just 2D identities. It also critical to have a partner that can bring a global perspective – the idea of ‘a great service experience’ in one market can vary significantly from another.
It’s also worth pointing out that this shift to experiences is not the exclusive domain of luxury goods – many mass-market brands are tapping into the power of experience to enhance their bottom line. One notable example is Reebok’s partnership with the CrossFit fitness programme. Click here to read more FutureBrand commentary on this partnership.Social tagging: brand experience > Brand Strategy > experience > growth > intangible > luxury > purpose > strategy > tangible > trends