We once hailed the vast amount of wealth the U.S. had seen over the past few years and the countless opportunities luxury brands had to fill their coffers. Times have changed, and with it, the means in which luxury brands can exist in this new era. We’ve been asked our thoughts on how luxury companies can survive. Our counsel has not changed – build relationships with your customers.
The challenges luxury brands are currently facing were created by the very opportunities that originally fueled their growth. From the influx of overnight millionaires with demands for more, luxury companies increased their production and created brand extensions to meet every scale of luxury buyer – from the $300 Coach handbag buyer to the $1.5 million Vacheron Constantin Tour de l’Ile consumer. The gilded age is over, and new values created by hard-earned economic lessons are now redefining what motivates a U.S. customer to buy luxury.
I believe prestige companies can weather the times if they embrace strategies that solidify relationships with their customers, while educating prospective luxury buyers on the history, authenticity, quality, and value of a premium purchase. The tide is beginning to turn, and purse strings have are loosening once more. Yet only companies who remain relevant to their customers’ emotional needs now will remain strong.
Please join me here Tuesday mornings as I continue examining the dynamic evolution of luxury. And every Friday, you’ll find a round-up of the best articles you may have missed on the luxury business.