MONTE CARLO — Discerning, demanding and younger: These are consumers the luxury goods sector will have to address once the global economy recovers from the downturn.
That is the view emerging from industry titans, including Bernard Arnault, chairman and chief executive of LVMH Moët Hennessy Louis Vuitton, the world’s largest luxury goods company, and Angela Ahrendts, chief executive officer of Burberry.
Arnault said these post-recovery customers will place a particular emphasis on values like quality and craftsmanship, but also exclusivity and commitment to social and environmental responsibility.
“Nothing will be the same again. It would be illusory to think it will be the same again,” he said, speaking at the Financial Times’ Business of Luxury Summit here.
Unlike during the boom years, the luxury consumers of the future will be less inclined toward the ephemeral, and will want to own exclusive items of outstanding quality. What’s more, he said, this trend will spread across continents, narrowing the difference between consumption in the developed and developing countries.
“In the most developed countries, customers will want exceptional brands,” he said, noting that “in developing countries, customers will increasingly adopt the consumption models of developed countries.” Arnault’s forecasts seem to vindicate the strategy pursued by LVMH over the years.
Unlike some luxury retailers — which last year slashed prices in the run-up to Christmas in fear of a negative season — LVMH’s flagship brand Louis Vuitton has a policy of no markdowns to preserve its prestige and value status.
And while the industry has shown an uneasy approach toward e-commerce, Arnault has pointed at its increasing importance as a marketing channel to reach out to new, younger customers, even though it’s a tool that poses some risks for the industry, as witnessed by the booming trade of counterfeit items on Internet sites. LVMH has been slow to roll out e-commerce to its brand’s Web sites for that reason, and has been vigorous in taking legal action against sites such as eBay that sell LVMH products, many of which it claims are counterfeit.
“I don’t want to stop the Internet. I want to use it efficiently to develop the growth of brands, but in a safe way,” Arnault said.
Targeting younger, technologically savvy customers is also a priority for Burberry’s Ahrendts. Today’s twentysomethings — or Millennials — who are active users of the Internet through social networking sites and aren’t as easily influenced by the traditional media as previous generations, are fast becoming the core customers of luxury brands, edging away aging Baby Boomers, Ahrendts said.
As a result, she has sought to make them part of the company on purpose.
“Millennials are a significant part of Burberry today,” she said. “They are designers, the public face in advertising campaigns and store staff. They are resonating with core consumers.”
The company recently named 19-year-old British actress Emma Watson, who stars in the “Harry Potter” movie series, as its newest face, joining models Kate Moss and Agyness Deyn.
The new focus on younger generations isn’t just a branding exercise as the industry tries to shrug off the severe economic downturn, but a necessity, as highlighted by economists at the conference.
“We are an aging society, we should care about consumption in 2020,” said Norbert Walter, chief economist at Deutsche Bank Group.
For its next men’s wear collection, @roberto_cavalli will show as a special guest at #PittiUomo, running from June 12-15. The brand, which has Florence in its roots, will relaunch its men’s wear collection, which will be presented separately from women’s wear for the first time since Paul Surridge was appointed creative director in May. #wwdnews #wwdfashion (📷: @aitorrosasphoto)
“I was making the guacamole when my scout saw me,” says model @stuckinteenage on being discovered just six months ago while working at @chipotlemexicangrill. Since then Williams has signed with @dnamodels, walked in her first show at @calvinklein and landed on the cover of @vogueitalia – a high point of any model’s career. To read @lisajlockwood’s full interview with the model on her experiences thus far, head to WWD.com – link in bio. (📷: George Chinsee)
“I love the idea of dialogue, period. It’s where I’ve always gotten my inspiration from: hearing other women speak, their journeys and their paths,” said @hereisgina, who delivered the keynote speech during @sxsw for @createcultivate in partnership with @fossil. For her two panels, Rodriguez chose female empowering, female-led and female entrepreneurs to focus on. Head to WWD.com to read more about her thoughts on Time’s Up, growing up in a family of women and why we “need a girls’ club.” #wwdeye #sxsw (📷: @jgreenery)
Leading luxury brand are shaking things up to keep up with streetwear. Case in point: the arrival of @mrkimjones as artistic director of @diorhomme. Jones, who succeeds @Kris_Van_Assche, is seen as one of the handful of designers who can actually straddle the luxury and streetwear worlds — which could lead to even more changes at established brands. What could this mean for the rest of the menswear landscape? Head to WWD.com to find out what experts predict #wwdfashion (📷: @franckmura)
“It’s like buying groceries. You’re going to buy the best mango, the best mozzarella, the best things. You have to, or others are going to take it all,” said @gabrielahearst on why she uses only the finest fabrics. Last week, Hearst received her first @cfda nomination for Womenswear Designer of the Year, and earlier this month she opened a permanent showroom in Paris. To read @jessiredale’s interview with the designer and find out why this is shaping up to be a big year for her, head to WWD.com. #wwdfashion (📷: @francoisgoize)
“It’s an interesting thing, playing a younger version of your mother. It’s an interesting concept. I adore my mom and love her in every capacity, but it was just something that had never crossed my mind,” says @anniemstarke on playing a young Joan Castleman in “The Wife.” The same role will be played by her mother Glenn Close. Read more about her growing up in the film industry as the daughter of producer John H. Starke and Close and what she has planned for the future #wwdeye (📷: @nataliamantini)
@asics is launching a new streetwear sneaker inspired by its latest ambassador, @steveaoki. The Hyper-Kenzen x Aoki, which will launch at @footlocker stores exclusively tomorrow, is a slip-on style that incorporates the brand’s proprietary Gel technology through beads integrated into the midsole for comfort and endurance. Read the full story on WWD.com.