How the Luxury Marketing Landscape Is Evolving with the Industry

Olivia Fitzpatrick
February 2, 2021
Lasted Updated On

Over the years, the luxury industry has survived the ups and downs of massive world events including wars, economic recessions, and political turmoil. Today, the industry faces the challenge of adapting to an increasingly digital world. Between new social channels, the rise of the Gen-Z influencer, and 2.14 billion buyers worldwide expected to purchase online in 2021, the way luxury brands connect and interact with their consumers is shifting. Read on to learn more about how brands are leading the way during this transformation in luxury marketing.

The Shift To E-Commerce

No longer able to rely on in-store experiences and physical interactions, many luxury brands previously hesitant to embrace digital channels turned to e-commerce in 2020 as a primary means of revenue. Traditionally personalized services that set luxury brands apart from the fashion industry as a whole, such as fashion shows, private shows, personal shoppers, and concierge services, have been moved online. Luxury marketing now involves tapping into AI-technology and data to understand client preferences and personalize the experience from product suggestions to smart-fitting technologies. And it’s paying off—in Q3 2020, LVMH announced a return to pre-pandemic double-digit revenue growth, driven by localized e-commerce strategies, signaling a positive shift to the digital age.

A New Generation

In the past, luxury brands thrived on their exclusivity. A luxury good was aspirational. Slowly, luxury brands have been moving away from this dated ideal and targeting a new-age consumer: Gen Z. A generation heavily influenced by social media and open to innovation, this age group is challenging the ways luxury brands market, forcing them to explore new channels, create unique experiences, and engage in brand storytelling. Making headlines in 2020, Prada invited 16-year-old TikTok star Charli D’Amelio to their Fall/Winter 2020 Womenswear Show in Milan. This pairing of a popular Gen Z influencer and well-known heritage brand broke down barriers between the two worlds and set the new standard for luxury marketing and what’s to come.

Socially Savvy

Luxury brands were considered late adopters of popular social marketing channels, such as Instagram and TikTok. Today, with 70% of global Gen Z shoppers making purchase decisions through Instagram, luxury brands need to meet consumers where the inspiration stage happens. Building a community through meaningful interactions with brand fans on social media is what fosters loyal customers. While transparency and authenticity haven’t always been a key focus for these brands, using these platforms to engage with consumers is a great first step. Recent examples of community-building initiatives from these brands include Gucci’s viral TikTok trend, #GucciModelChallenge, or the incorporation of a link-in-bio solution on Instagram from luxury brands like Balmain.

Values-First Approach

As consumers become more conscious about the brands they invest in, luxury brands are looking to do the same. An industry that typically steered away from showcasing anything other than the high-end goods they sell, is now tapping into the authenticity pillar. Whether it is marketing campaigns championing diversity, environmental initiatives, or supply-chain transparency, luxury brands are becoming more “real” to appeal to today’s consumers. British luxury brand Stella McCartney is a great example of the future of luxury marketing. The brand plans marketing campaigns for new collections around sustainability and transparency, two of its core pillars.

The Future of Luxury Marketing

Changes in the luxury industry have marketers and fashionistas alike excited for the future. Watching these brands innovate across social channels, tap into younger audiences, and convey brand authenticity in their marketing tactics is both fascinating and long-overdue. For more insight into luxury marketing on social, including the KPIs that matter most and top brands for each, check out Dash Hudson’s 2021 Instagram Benchmarks below.

Download the benchmark report

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