In the face of recent economic uncertainty, luxury fashion brands have proved particularly resilient.
French groups LVMH, Hermès and Gucci-owner Kering are all expected to report double digit third-quarter sales growth for 2022 — buoyed partly by sustained demand post-pandemic.
But the market remains unpredictable. Luxury brands will need to do what they do best and keep pace with trends if they are to maintain this momentum. To help, a new report from Vogue Business for Google, “CUBE: Fashion Takes Shape”, shines a light on the consumer shifts set to shape the future of the sector.
Here are four key findings from the report, with associated actions for luxury brands.
1. Shoppers are seeking brands with values that align with their own
People are looking to engage with brands that share their values as well as their aesthetics. Indeed, 82% of consumers say they need fashion and luxury brands to assist in expressing their true self.
But our research suggests there is a gap between what people and fashion houses consider authentic. While brands look to craftsmanship and heritage as signifiers of authenticity in products, consumers are also seeking out clothes and accessories that communicate certain values and aspirations, such as kindness and acceptance and a desire to minimise their environmental impact.
Tip: Communicate your values in your storytelling
Today, what people love to watch, read, and interact with increasingly reflects their values and beliefs. This is especially the case among Gen Z, who are seeking out this content on YouTube.
The platform allows audiences to express their personalities in depth with long-form videos and at speed with formats like YouTube Shorts. For luxury brands, being present is only one part of the picture. Rethinking your storytelling for the platform can help communicate a deeper purpose that aligns with customers.
2. Sustainability is becoming top of mind
Search interest in the U.K. in sustainability continues to rise, but over time we’ve seen more people using context-setters or “modifiers” in their queries. For example, rather than simply searching for the topic “sustainability”, people are looking for “sustainable clothing brands UK”.
It’s an indicator that shoppers are becoming increasingly proactive when it comes to issues such as climate change — and that includes choosing one brand over another if it can show how much it respects the environment, society, and people.
To earn loyalty, luxury brands will have to communicate their sustainability credentials clearly and honestly.
According to the Vogue Business Index, 68% of luxury consumers believe both a brand’s sustainability policies and its provision of a living wage throughout the supply chain are important, with 31% and 28%, respectively, saying these are mandatory.
To earn loyalty, luxury brands will have to communicate their sustainability credentials clearly and honestly and address the issues consumers are most concerned about.
Tip: Show your sustainability efforts
From how you handle e-commerce returns to guiding shoppers towards greener choices, consider how to best demonstrate your sustainability choices through your user experience.
Make it simple for shoppers to discover environmental and social impact information as part of their shopping journey across all touchpoints. And look to offer more visual signals to help users, such as badging, to indicate if a product is made from organic or recycled materials.
3. Luxury shoppers are more channel agnostic
In a hyper-connected world, the boundary between online and offline luxury shopping experiences is becoming blurred, with consumers moving away from a linear path to purchase.
Qualitative interviews for the CUBE report suggest that as spend per item increases, a slowing down of the pre-purchase journey is happening for many. This can mean long periods of online and offline research before an individual makes a big purchase.
Qualitative interviews for the CUBE report suggest that as spend per item increases, a slowing down of the pre-purchase journey is happening for many.
Consumers are also more likely to be channel agnostic, assessing and picking a channel each time they make a purchase depending on convenience or innovations, such as an in-store VR experience.
Tip: Harness shopping innovations
Use new technologies to offer luxury shoppers a more immersive experience, such as 3D and augmented reality solutions in Google Search. Developing experience-first “phygital stores” that blend seamlessly with online can also help to keep potential customers in the funnel.
4. Communities are leading the way
Innovation in the luxury sector isn’t just about technology. it will also increasingly come through local communities and creators, who can predict and influence trends before fashion houses.
For example, young male communities from the U.K. are discovering and shopping for trainers, watches, and collectibles together, in a phenomenon known as “squad shopping”.
Brands will have to embrace new, extraordinary ways of communicating with consumers. This means collaborating with different communities in a way that feels authentic to reflect their needs and aspirations.
Tip: Partner with like-minded creators
Invest in communities and relatable content where trust and influence is native. For example, seek out and support relevant creators whose audiences and values align with your own. Experimenting with different platforms — and the creators on them — can help brands in the luxury sector connect with new or hard-to-reach audiences. When technology moves forward, such as shoppable video on YouTube, take the time to think how it could work for your brand and where it provides opportunities to connect meaningfully with creators and communities.
Download the CUBE: Fashion Takes Shape report from Vogue Business for Google to discover more about changing consumer behaviours in the luxury sector
