The digital transformation continues to disrupt business as usual for luxury brands.
Beyond the changes happening in luxury retail, luxury brands have made important shifts in their creative direction, brand aesthetic, and marketing strategies in an attempt to meet the expectations of modern, younger affluent consumers.
As competition among luxury brands for millennial wallet share intensifies, winning luxury brands are those that prioritise digital competency. And some have been more successful than others in their digital implementation, as evidenced by their popularity online.
According to a recent report published by Luxe Digital, the top 15 most popular luxury brands online are those that are successfully engaging with luxury consumers —particularly Millennials and Gen Z consumers— where they are actually spending their time (read: online and on social media).
The ranking provides a good picture of the brands’ performances and potential and is a great source of inspiration for luxury leaders. Analysing how the top high-end brands are performing online can provide answers to their growing popularity online and how to achieve similar success.
Gucci tops the 2018 ranking, followed by Chanel and Louis Vuitton. But Balenciaga emerged as the fastest growing luxury brands of the list; an impressive growth that has been driven mostly by its unique take on luxury streetwear (considering logomania and the demand for high-end streetwear reached an all-time high this year).
Luxury brands increasingly turn to Direct-to-Consumer channels
The top 15 list is largely dominated by luxury fashion brands, although Rolex and Tiffany made it to the top 10. Lancôme, the only beauty brand to make it to the list, ranks at the 13th position.
Luxury brands are increasingly turning toward monobrand stores and Direct-to-Consumer e-commerce as Luxe Digital’s report highlights. The Direct-to-Consumer approach allows luxury brands to better control their brand’s online presence and keep ownership of their data.
With the younger generations now constituting a significant segment of the luxury market, brands are shifting their messaging to align more with millennial values.
The value Millennials place on authenticity and ethics is forcing luxury brands to show off their efforts in sustainability and social responsibility. Ethically sourced, natural and vegan beauty products, for example, is high in Millennials’ priorities.
Influencer marketing still plays an important role in 2018, but brands are now further diversifying their influencer portfolio to reach into untapped communities.
Winning the heart (and wallet) of Millennials and Gen Z consumers is essential for luxury brands
Affluent Millennials and Generation Z consumers have different ideas about luxury than previous generations. This shift in consumers’ values and preferences pushes brands to seriously invest in digital innovations to reach and engage the desirable younger generations.
Creating a seamless experience across offline and online channels is particularly crucial for luxury brands, which should provide first-class service and convenience to their customers.
Regardless of size or overall budget, it is clear that luxury brands must pivot toward digital sophistication if they hope to maintain relevance and appeal to the modern luxury consumer or risk falling behind.
Read the full report and see where you stand compared to the 15 most popular luxury brands of the year.