Luxury retail : 5 trends to follow in 2023
September 16, 2024
2022 was all about experimenting! Indeed, with the end of health restrictions and in-store shopping back to life, brands needed to adapt and find a way to still motivate people to visit their stores but also provide them with an online experience. In our article about the 2022 retail trends, we explained that the big challenge for retailers was to strengthen their online presence without abandoning the physical market.
For the luxury industry, trends tend to be a bit different as it is a more specific and complex market. Customer journeys have to become frictionless; people must have the opportunity to ask questions and get advice more easily and seamlessly. It’s all about the mixing of digital channels and human interactions.
Our team of experts inquired about the next trends for 2023 by directly speaking to our clients in the luxury industry.
In the luxury segment, brands were previously only focused on the product and its quality. Don't get us wrong, it is also really important to make sure your product is perfect before selling it! But luxury brands need to become more customer-centric.
Customers need to feel that they matter to the brand - so, centering your efforts around the customer is becoming really key. Clients are willing to pay more for luxury products, but to achieve that, you need to make them feel privileged and offer them the best purchase experience, whether online or in person.
Appointment scheduling is a great way to focus on customers. By offering them services by appointment, your associates can prepare before each visit to provide your clients with a personalized shopping session, which usually leads to conversion and loyalty.
This one was already trendy in 2022. Experiential commerce joins the previous trend about the customer focus.
You have to see your store as a community hub, a destination where people want to come. Not necessarily just to purchase, but to interact with ambassadors, with your associates and really live the experience offered by the Maison. Offer your customers a real “voyage” when they visit your store. A lot of luxury brands are opening coffee shops, restaurants and concept pop-ups inside their boutiques to make the customers live a privileged moment inside the brand’s universe. The goal is to create an emotion and build a relationship with the client.
To go further, especially with the new “habits” Covid-19 has created, brands are offering way more online services by appointment such as live shopping sessions or virtual consultations so the client can still live the brand experience at home. That online layer and that digital experience are definitely key. It is here to stay and can only go further.
Today, Millennials and Gen-Z represent 50% of the industry's buyers! It is therefore essential to focus on this new generation of consumers born between the early 90s and mid-2010 when establishing your strategy.
A number of luxury brands have already understood this trend and are trying to exploit it through the new buying criteria of this generation. Indeed, those consumers place their values at the heart of their purchase process - they look for authenticity and innovation. This generation is also qualified as hybrid buyers. This means that they try to get in touch with the company through various channels: online research, social media, in-store visits... before finally making a purchase. So once more, we observe that the consumer has both digital and physical expectations.
In an era where TikTok and Instagram are the main informational and entertainment channels for Millennials and Gen-Z, content creation is crucial if a brand wants to get noticed and add value. According to buyers, having a brand create original content to talk about its products, materials, or even history through images and videos is essential to making them consider buying.
Social luxury is a trend that's capturing the attention of many consumers. Referring to the previous point on the rise of Millennials and Gen-Z Clients in luxury, this trend is one of the most important ones to act on!
With the age of social media and information at their fingertips, customers are becoming more aware of the products they purchase in terms of materials, durability and above all, consciousness. The new generation of luxury Clients has a much higher level of awareness and opinion. Lack of social conscience of a brand can influence the consumer and prevent them from buying for ethical reasons: animal cruelty, manufacturing by poor and underpaid workers, unsustainable materials that pollute the planet, etc. Furthermore, according to a Klarna study, 73% of consumers consider the sustainability practices of luxury brands in their purchasing decisions.
The term 'social-conscious luxury' appears when a stand on a socio-economic issue is taken by a brand - whether in terms of sustainability, ethical manufacturing processes, materials, etc. Supporting a social or political cause can be a key element in luxury branding, as this adds to your brand's story and highlights its values, which encourages connection with customers. As a luxury brand, it is essential to show the world how you support a particular cause; you must act on it to reflect an authentic image. Brands such as Gucci, Chloé, and Stella McCartney have understood this challenge by putting their values and ethics front and center.
These values and eco-responsibility must not only reflect in the products, but also inside the stores: recycled materials, receipts sent by email instead of being printed, etc.
Finally, this trend is more on the marketing side. Return on ad spend (ROAS) is an essential key performance indicator to establish a marketing strategy. It determines the amount of revenue generated for every dollar spent on a campaign, so you can see if your strategy is a success or not and how to upgrade it. This is the missing piece that luxury brands must focus on; it is really important to track physical traffic, following an advertising campaign and see how that uptick influences offline traffic and in-store purchases.
Appointment scheduling can be that bridge from online to offline experiences. With the right software, you can measure online performance and see how it converts. With that information, you can establish a qualitative strategy by knowing where to invest in your next campaign.
As you understand, for 2023, the focus is really centered on the perfect blending of digital channels with human interaction. Customers are looking for the human touch, but still need to have that choice of purchasing online without losing the brand experience.
