Navigating the shifting landscape of luxury retail preferences

This article first appeared in A1 Retail written by Ewald Damen, Creative Director at Virgile + Partners.

The constant changes in how we interact with each other and the world around us have certainly taken us down new paths and influenced how and why we make our choices.

Intelligent technology has not only made our lives more practical and provided us with desired information at the click of a button but has also been able to show us things we think we want, or even think we need, through personalised algorithms and fast-advancing AI. Although not an expert in any of these fields, I do see how this has strongly influenced the choices of modern-day consumers when selecting products or brands.

For some time now, brands have consciously been building an increasingly customised lifestyle to ensure a dedicated and loyal customer audience is attracted to its core values. Many brands have been using technology to get consumer insights helping them produce a more tailored service and closer affiliation, all to create a stronger fan base and increase customer loyalty. Products are presented through previous unconventional media channels and the rise of social media has helped to reach people in different ways targeting them at appropriate times through search algorithms.

Luxury brands are not exempt from this changing world and as early adapters experiment and explore to stay at the forefront of innovation. Their high-value customers are a discerning audience themselves and are selective of the brands they relate with. These consumers are now also targeted with a strong focus on progressively individualistic approaches and accelerated clever technology has in return, generated a desire for a constant refresh of what we experience and purchase through a persistent stream of personalised content.

Brands have to navigate the repeatedly evolving digital and social landscape predicting how individuals will interact with them. An increasing challenge for the market is that channels like social media are important tools, but we also see more and more cautiousness on what is presented or even a negative response to targeted media with some of their customer base taking digital breaks or in extreme cases opting out completely. Changing privacy laws will also play a part in how we can gather and store information.

In general terms, we need to accept that the changes in communication have benefitted the brands but they now need to become even more clever than just a blunt algorithm. As machines are learning, so is their captive audience and they are adapting to how they want to interact and be approached. It’s for the brands to keep up with technology and how they use it to extract their consumers' desires and provide them with this intensely personalised communication experience, delivered in a subtle and valued manner. New ways of interacting with their clients will most certainly involve inviting them to new experiences and services that enhance their lives in other ways than just product sales but complement their lifestyle choices or desires, both in a digital and physical world.

Just as we’ve seen with celebrity endorsement shifting to influencer endorsement, the luxury market is tasked to find new and innovative ways to truly engage on a personal level with their customer as an individual.

Luxury brands pride themselves on a crafted and tailored service model with extreme attention to detail in their products and delivery. These principles do not change in this changing world, they remain at the core of how luxury brands communicate with their audience and seek opportunities for the benefit of understanding their customer better through digital engagement.