The Harvard Business Review released a new study questioning the “trickle-down effect” in luxury consumption while presenting an interesting new cultural phenomenon: Global elites need new ways to communicate their wealth and status.
Since traditional status symbols such as Chanel bags and Dior accessories have become accessible to “the aspirational class,” the global elite is “skipping over any middle ground and plucking the most mundane items to refashion as something special,” according to the Robb Report.
Essentially, elites are embracing quirky styles like the Chanel Lego Brique bag or Givenchy’s Bambi neoprene sweatshirt, both of which sell at high prices but are reminiscent of a lower-status social group. Replacing luxury objects known for their high level of finish and craftsmanship with unconventional items that are plain and mundane is a result of the democratization of luxury.
And while the middle-market consumer is "selectively trading up to higher levels of quality, taste, and aspiration,” the top tier of society is adopting ordinary items like Dior cotton T-shirts that sell for 590 and are remarkably insipid and dull. Nevertheless, elites will still mix these lower-tier products with high-end ones such as expensive jewelry pieces or custom-made apparel.
“In this context, elites can experiment with lowbrow culture and downscale tastes without fear of losing status, while middle-class individuals, whose position is more tenuous, stick to clear-cut status symbols,” says the report. The Harvard Business Review highlights how this unusual phenomenon is “trickling-round from the bottom straight to the top, bypassing the middle.”
Today, luxury involves exclusiveness, nearly uniqueness, and not because it is addressed to a few people, but because it's special.
But is this occurrence addressing the needs of the future of the global luxury market: Chinese Gen Zers? We try to shed some light on this phenomenon by analyzing how this young, demanding Chinese consumer base is reacting to it.
First, this consumer group holds anti-establishment views that go against most conservative concepts. They are critical consumers who dive deep into social and environmental issues and care strongly about sustainable shopping. Consequently, this trend is appealing to them because it creates a more inclusive and democratic environment.
“As socially conscious consumers, Gen Zers expect brands to adhere to high ethical standards,” states research from OC & C Strategy Consultants. “In fact, Gen Zers are willing to take extra steps to research brands’ supply chains and employment practices before making purchase decisions.”
The research highlights that Chinese Gen Zers care more about environmentally friendly consumption than their peers in the West (25 percent versus 13 percent for global Gen Zers).
Second, Gen-Z consumers differentiate themselves from past generations by their strong desire for individualism. They are self-reliant and intelligent consumers who love products that are designed to differentiate them from the masses. The South China Morning Post and the global insights and data firm Agility conclude that Chinese Gen-Z consumers “put individuality and self-expression first when deciding which luxury brands best represent them.” Furthermore, according to interviews conducted by Agility, over 500 Gen-Z consumers show a willingness to challenge rules to create their own path.
The research shows that 30 percent of Gen-Z interviewees believe that “luxury” is “something that shows my taste,” while 29 percent translate “luxury” into “something unique.”
Third, this digital-first generation loves designer items as a means for clickbait. A ready-to-wear tweed Chanel jacket is a wardrobe essential of exceptional quality, but wearing that timeless classic won’t bring the same social media engagement as a whimsical Jeremy Scott dress or Balenciaga track sandals.
Since the social media generation has an increased focus on peer validation, they chase online visibility and luxury goods that offer extensive media exposure.
Luxury brands want to become more “accessible” because of the potential of this market. But making luxury overly accessible or relevant for Gen Zers while ignoring the needs of the full range of buyers can be dangerous. A desire to appeal to the newest luxury consumers could cheapen brands and sink their desirability.
In 2011, the legendary Franca Sozzani said, “today, luxury involves exclusiveness, nearly uniqueness, and not because it is addressed to a few people, but because it's special.” Indeed, luxury has always been an authentic experience or an exclusive relationship between a customer and a brand. Social media and technological innovations have democratized luxury, bringing the brand closer to consumers than ever before. But today's “fashion for all” mentality is killing exclusivity and creating an overexposed world where luxury's appealing symbolic assets are beginning to disappear.
But in the end, luxury is constantly reinventing its intangible qualities while finding creative ways to serve the evolving tastes of global consumers.