Luxury Trends for 2019
Disruption and the Luxury Industry.
2018 was a year of disruption for the luxury industry. Reinvention was a reoccurring theme in the round table discussions that KNOCK participated in with senior industry executives at Luxury Interactive 2018. Insights from that conference, combined with third party research and trend analysis, led to a perspective of the ever-changing luxury landscape for KNOCK’s clients.
According to Bain & Company, the industry has seen a 5 percent year-over-year growth, as well as $1.36 trillion in sales in 2017*. And as luxury continues to grow globally, new audiences and new marketplaces are creating a landscape that warrants differentiation more than ever.
The new audiences.
A shift in consumer demographics is forcing the luxury landscape to evolve and respond to a more diverse and inclusive perspective. Collectively, Millennials and Generation Z will represent more than 40 percent of the luxury goods market in less than ten years.* Luxury brands are reinterpreting streetwear to appeal to these younger consumers and attract new audiences, leading to the skyrocketing growth of categories such as T-shirts (+25% YOY), down jackets (+15% YOY) and sneakers (+10 YOY%).**
These new audiences are driving change in the luxury space with both their voices and their values. Digital platforms provide a voice for these audiences and emerging luxury trends are championed across social media.
Left to right: Naadam, the world's fairest cashmere; Stella McCartney in Fur Free Fur Masha Jacket; Fenty Beauty by Rihanna
An emphasis on values is expected.
Among these emerging trends is the desire for value-driven brands. Consumers want, and expect, brands to show genuine commitment to political and social issues of the day. Brands with messages of inclusivity and sustainability are gaining mainstream momentum as a result of their named values.
Gucci made a mark when it announced that it would be going fur-free for its Spring 2018 collection, and while the luxury fashion brand was not the first to make a fur-free commitment, many other brands have since followed suit. Disruptive beauty brands, like Rihanna’s Fenty Beauty, are breaking the industry’s mold with inclusive-led messaging and products for all women. And cashmere brand Nadaam is prioritizing sustainable sourcing while revolutionizing the pricing and production of top-quality materials through a direct to consumer approach.
Everything is being reinvented.
Luxury brands’ renewed emphasis on values are driving them to create and curate fresh experiences for the industry's new millennial consumer. These include forward-thinking experiences that often leverage non-traditional branding and interactive elements. Gucci has incorporated “random acts of kindness” into their customer experience strategy while also launching immersive augmented reality experiences to bring their print campaign to life in new ways; Burberry unveiled out of home branding that scaled entire buildings; Van Cleef & Arpels developed master classes to educate and inspire the next generation of fine jewelry consumers. Through these renewed experiences, we’re seeing luxury brands become less precious and honoring their heritage in modern ways to appeal to the industry’s shift in consumers.
Left to right: Fendi; Burberry; Gucci
Storytelling + experiences are key.
Consumers are interested in discovery when shopping and scrolling. Brands can no longer rely on status-symbol products and exclusivity, and new approaches to traditional media in luxury allow consumers to experience brands in new ways. As a full-experience agency, we help clients invest in interactions across channel touchpoints, to inspire meaningful conversion and exploration.
*Bain & Company Luxury Goods Worldwide Market Study, Fall–Winter 2017, Luxury Study 2018 Spring Update
** Deloitte Global Powers of Luxury Goods 2018