Luxury Branding Research: New Perspectives and Future Priorities

Several major trends have changed the landscape for luxury brands. These shifts include the increasing role of technology (digital and mobile) as well as the use by consumers of alternative signals of status, such as wearing less prominently branded apparel, being less conformist (e.g., entering a luxury store in a casual outfit), consuming leisure time in a conspicuous way or, conversely, the flaunting of a busy life and a dearth of leisure time. In addition, people’s relative interest in buying luxury experiences versus luxury products is increasing. Technology has introduced new business models, such as collaborative consumption in a sharing economy (e.g., Onefinestay, Rent the Runway, Sentient Jet), and there is a more explicit focus on sustainability (e.g., Stella McCartney). Luxury brands need to consider the increasing global connectedness, particularly the importance of the Chinese market for luxury companies, as well as customers’ changing expectations for the brands. Companies can leverage storytelling to build their brands, and careful brand extensions can grow the business as long as they do not alienate core loyalists. Other potentially risky opportunities to weigh carefully are moving production from the original country of origin, letting the merchandise design be guided too much by customers’ wants and needs, using off-price distribution channels, and partnering with a mass merchant on a shared collection (e.g., Target and H&M collaborations).