One consumer’s luxury is another’s ordinary: this is the identity crisis the luxury sector finds itself facing. The term itself is being shattered – ten years ago, ‘luxury’ meant relaxing in a spa in the Swiss Alps, splashing out on an expensive designer handbag or spending time at a perfectly manicured golf course.
But nowadays, younger consumers in particular have more diverse needs and tastes. The term is having to morph and change as a result.
As things become less clear-cut, how can brands truly meet consumer expectations when definitions of luxury are so disparate?
The solution for luxury brands is greater psychographic targeting. By adopting this approach, brands can focus their appeal on their target audience and position themselves in a way that will appeal to a specific mind-set or behaviour.
1. Take an audience-first approach
It’s no secret that millennials and Gen-Z spend money differently than previous generations. And while some of their spending habits may not guarantee future financial stability, there are opportunities for luxury brands to appeal to these groups if they take an audience-first approach.