In the Luxury chapter of our Expert Outlook 2015 series we speak to Marco Bevolo, Morag Bruce and Christopher Jenner about how the affluent world of the bespoke will change in 2015.
Marco Bevolo is a Lecturer at NHTV University of Applied Sciences. He has performed research programs on luxury, premium categories and the High End since 2006. He co-authored the book Premium by Design.
The polarisation of advanced economies between High Net Worth individuals and ‘impoverished’ middle classes will continue to grow. Sales of ‘investment luxury’ brands (eg Rolex) or goods (eg gold and silver) will increase, and people will become more focused and savvy when it comes to making these luxury purchases. They’ll opt for items that keep their value over time, using these purchases to replace more volatile forms of savings.
Changes in the lifestyles of Generation X will also affect the luxury sector. Professional positions and career paths are much more fragile. The amount of affluent professionals going back into higher education in their midlife will explode. Having to refocus their resources in investments of such magnitude, people will inevitably give up purchasing status symbols.
People will opt for items that keep their value over time, using these purchases to replace more volatile forms of savings
In 2015, more than ever before, people won’t be attracted to the ‘bling bling’ of empty possessions; rather, they’ll look for substance. The shift from materialistic notions of luxury to more experiential and even spiritual forms of high-quality consumption will continue. People will spend big on leisure, food and wellbeing.
There’ll be a rise in demand for high-end tourism that mixes medical services with leisure. Countries in the Far East, Latin America and Eastern Europe will emerge in a new premium mix that might innovate the notion of ‘what’ luxury is.
Vlisco creates a dialogue between traditional luxury and visual themes from a vibrant continent
Vlisco (2014) ©
It will be difficult for retailers to keep up with 2015’s political, economic and ideological changes. Some brands, like Gucci, are already experiencing a crisis due to their lack of creative edge. Other houses, like Prada, continue to present themselves as cultural players, with prestigious collaborations (eg Kolhaas) and fine arts curatorial leadership (eg Venice Biennale). A higher degree of innovation, and disruption, will be key for luxury brands in 2015.
The luxury arena is way less exciting than a decade ago. Most luxury brands have continued to work on an aesthetic and cultural alignment to the contemporary zeitgeist, neglecting the fact that society around them is rapidly changing. There are, however, three areas that excite me for the coming year.
The first is the digitalisation of more wearable categories. This will be led by the introduction of the Apple iWatch. It won’t affect the market of haute horologerie but it will take the less consolidated and historical brands by storm. Rivals Samsung and Sony cannot compete with Apple in terms of brand positioning and, ultimately, charisma. More wearable categories brands, from fashion to accessories, will seek new territories in high tech innovation.
The second is that as a society we’ve exhausted our imagination. To keep things fresh, and brands constantly renewed, we will need to find new worlds of reference: from sci-fi to ‘new ethnic’. A successful example is Vlisco. This Dutch company embraces African premium textiles. Vlisco manages to create an authentic dialogue between traditional luxury imagery and exciting visual themes that emerge from a vibrant continent.
The automotive sector is also an area to watch. The ‘high premium’ segment is pretty lively. Brands like Tesla have injected ‘design sexiness’ into the electric car proposition, and traditional brands like BMW will continue to experiment new designs for their electric hybrid and new technologies.
Christopher Jenner started his interior design studio in London in 2010. He has fast gained a reputation for devising design concepts that are strategic and visionary. Clients include Penhaligons, Drummonds, Liberty and diptyqueparis. In 2013 he was appointed Creative Director for the Eurostar.
In 2015, smaller niche brands are set to grab a larger piece of the pie. The large, established brands will need to make a more connected investment in their personality to ensure they keep reaping big rewards.
Luxury brands will increasingly think local, learning to connect on deeper cultural and demographic levels, thinking past current strategies to ensure continued custom and loyalty. Notable premium brands will seek to step up into the lucrative luxury sector by elevating and illustrating their values.
The big losers will be the predictable, global, ‘luxury’ brands
We’re at the start of a consumer revolution. The average Joe is no longer so average. Everyone has an opinion and everyone is informed; consumers will be making personality-driven choices, seeking out that point of difference which enhances and defines their ‘uniqueness’. This is especially true in emerging markets; the so called emerging consumer has already emerged.
The big losers will be the predictable, global, ‘luxury’ brands. Increasingly, they’ll sacrifice credibility to the endless pursuit of profit, access and real estate. Can luxury brands continue to define themselves as truly luxury with a 200+ store network? Are they not simply in danger of becoming manufacturers?
Craftsmanship and showmanship will become increasingly relevant. A more engaged, connected, brand personality will find loyalty and custom. Retailers will define themselves by continuing to move towards more crafted environments, expressing both provenance and the traditional handmade techniques.
There will be a renewed appreciation of Italian craft in 2015 - 2016. A rediscovery and awareness of the incredible talent of the Italian craftsmen will spur a renaissance in smaller companies in highly specialised, niche sectors.
Poltrona Frau is true craft aligned with cutting-edge technology to produce tomorrow’s design icons
Poltrona (2014) ©
There are several brands that I’m really keen to see develop in 2015. Kusmi Tea Paris is one of our new clients seeking a fresh, new, luxury positioning in the USA, Asia and Middle East.
I recently visited the Poltrona Frau factory in Marche. They’re making beautifully crafted, hand-made furniture. It’s true craft aligned with cutting-edge technology to produce tomorrow’s design icons.
Venini is one of the last remaining true glass manufacturers in Venice. Incredible heritage techniques married to contemporary forms create one-off, design-art pieces.
Puiforcat offers sensational silver-smithing with an eye on the ball. We’re likely to see more from this lifestyle heritage brand as they grow their brand profile and product offer.
Notable premium brands will seek to step up into the lucrative luxury sector by elevating and illustrating their values.
Morag Bruce is co-director of London-based agency Astrid, which specialises in projects and magazines targeting wealthy consumers. She is former acting editor of Alto, a quarterly luxury lifestyle magazine and daily website for UHNWI
What exactly is luxury? There is no exact answer, of course. It’s entirely subjective; these are our dreams. But this view can result in a scattergun approach, with everything from bubble bath to superyachts given the luxury stamp. An emotive word, easily applied – a marketer’s dream, surely?
Well, I think not, especially as luxury’s real target consumer wouldn’t even use the word. It’s not their dreams; it’s their reality. The definition I use in business is that luxury is the promise of exclusivity, supreme quality and rarity; everything bespoke. This creates a conundrum. In luxury, you can’t be too visible or too popular; you want to be under the radar, but also much desired. What does volume look like, when you can’t see it?
The recent changes at Gucci are a case in point. Outgoing creative director Frida Giannini certainly raised the brand’s profile during her years in post, but did that massive expansion into mainstream consciousness damage Kering’s flagship brand? It certainly experienced sluggish growth, while group mate Bottega Veneta, known for its more subtle approach, has quadrupled sales since 2006. In 2015, I think more luxury brands will be following suit, looking for ways to find or regain a balance between success and genuine desirability with the right consumer.
The UHNWI, the invisible consumer, is the spender who really gets high-end brands excited. They are the 200,000 or so people who travel the world in a special stratosphere, towering way above first class
The UHNWI, the invisible consumer, is the spender who really gets high-end brands excited. They are the 200,000 or so people who travel the world in a special stratosphere, towering way above first class. Of course they buy things, but you won’t generally find them visiting stores, and you can’t target them through mainstream channels. You need to understand their lifestyles, be where they are, be seen on their level.
Italian garment brand Loro Piana is title sponsor in a superyacht regatta, only open to 21 vessels, at Yacht Club Costa Smeralda in Sardinia. This investment is its version of OOH advertising; a few hundred invisible consumers will see its logo everywhere, central to a pastime they love, for a few days. Who needs mass appeal?
Loro Piana is a six-generation family business. This heritage builds trust, which, along with service, helps to create a long-term relationship with its customer. To be really effective, though, heritage must be balanced with a forward-thinking, agile approach, as at Loro Piana.
Another luxury brand getting it right, for me, is Moynat. This historic French trunkmaker, opened in 1849 and closed in 1976. In 2010, Bernard Arnault spotted the dead brand’s potential and bought its rights, separately from the LVMH umbrella.
It’s now making beautiful, timeless handbags from its French atelier (it can’t keep up with demand) and its Paris store was joined by a second, on London’s Mount Street, in 2014. Its creative director, Ramesh Nair, came from Hermès, so knows the understated, refined approach well. In an age of instant accessibility, if you want a Moynat bag, you have to speak to Moynat. And there’s no e-commerce.
The brand has just collaborated with Pharrell Williams (Nair was introduced by Sarah Andelman of Colette) on very limited-edition pieces inspired by the brand’s historic links with trains. The collection is now touring select stores around the world. When Beyonce carried the clutch in the shape of a steam locomotive, it did all the talking – the brand didn’t have to say a word.
Moynat closed in 1976. In 2010, Bernard Arnault spotted the brand’s potential and bought its rights
Moynat (2014) ©
Another luxury brand to watch in 2015 is Buly 1803, a new perfumer in Paris that looks as though it was frequented by Balzac. It’s the next project of husband-and-wife team Victoire and Ramdane Touhami. Ramdane previously revived the fortunes of France’s oldest candlemaker, Cire Trudon. This time, the label is a new version of an historic French apothecary. The store is beautiful, while the products blend traditional learning with contemporary techniques. Its niche and, for now, quite unique.
To attract the consumer who can afford to regularly buy from the top end of an offer, rather than fragrances or sunglasses, brands need to think as they do. Digital wizardry in-store is likely wasted on them, as they may well be shopping from their hotel suite. Brands that whisper, rather than shout, have credibility and cache, but are also locked into a promise of quality, will be the luxury success stories of 2015 and the years to come.