The changing nature of luxury: How brands are evolving to meet consumers’ demands

From authentic quality and a rich heritage, to a seamless service and individuality, the luxury experience is evolving in 2018 meaning brands must find what makes them special or risk being left behind.

Bloomsbury Street Hotel
The Bloomsbury Street Hotel by Edwardian Hotels London.

Modern luxury brands are evolving their offer to meet the changing tastes of consumers around the world. In some markets the heritage and timelessness of a product represents the ultimate hallmarks of luxury, while in others the focus is on the experience or exclusivity of the service.

New research reveals that different brands resonate with consumers in different areas of the world, according to which aspects of the luxury experience they most favour. The Kadence Luxury Index 2018 surveyed 5,775 consumers in 13 markets about their opinions around eight different components of luxury.

Quality emerges as the number one driver of luxury, followed by history, status, distinctiveness, timelessness, the feel-good factor, the experiential nature of the brand and exclusivity.

The research finds the more a brand is perceived to have an established story, the stronger the perception is of it being a luxury brand. Furthermore, brands known for using quality materials, craftsmanship or for consistently delivering a service that exceeds expectations are also more likely to have a high luxury score.

Globally, the data shows the car industry is considered the most luxurious, followed by jewellery, watches, airlines, fashion, hotels and alcohol.

Looking more specifically, jewellery and watch label Cartier emerges as the most luxurious brand, followed by Mercedes-Benz, Rolls-Royce, Ferrari, Lamborghini, Tiffany, BMW, Rolex, Porsche and Bulgari.

The research also shows that brands which resonate with consumers in the West are often different from those that are most popular among people in the East. While Cartier, Rolls-Royce and Tiffany top the list of most luxurious brands in the West, for example, Mercedes-Benz, Ferrari and BMW are the most luxurious brands according to consumers in Asia.

Kadence Luxury Index
The top 10 luxury brands in the West (left) and the East (right), according to the Kadence Luxury Index 2018.

Looking at the specific luxury characteristics, Cartier is voted as the most timeless, feel-good and exclusive brand, as well as being considered the biggest status symbol globally. Mercedes is the brand rated as strongest for history, while Rolls-Royce claims the top spot for quality. Worldwide, Lamborghini scores highest in terms of distinctiveness and being an experiential brand.

Italian luxury car brand Maserati comes in at number nine on the list of experiential brands, behind jeweller Chopard but ahead of BMW.

Earlier this month the car manufacturer launched its first UK TV campaign, aimed at boosting spontaneous awareness and positioning the brand as “significantly more exclusive” than rivals BMW, Audi and Mercedes.

Maserati’s new UK campaign.

Maserati general manager Mike Biscoe sees the quality of the product and materials as essential elements of luxury. Although increasingly exclusivity, especially the ability to personalise the product, is becoming more important.

“Globally, I think distinctiveness and the desire for individuality are important if I look at the market we’re in today and the competitors we are operating against,” says Biscoe.

“The likes of Audi, BMW and Mercedes are probably selling in excess of two million cars a year globally. A brand like Porsche is selling something like 250,000 cars a year globally versus Maserati which last year sold just over 50,000 cars. Maserati is far more exclusive a brand and therefore that appeals to this sense of individuality and distinctiveness, which I think also leads into the desire for more personalisation as well.”

READ MORE: Maserati revs up the competition with BMW and Audi with first UK TV ads

New definitions

The Ritz-Carlton hotel chain emerges as the eighth most luxurious brand in the Kadence Luxury Index 2018 among Western customers, just behind Lamborghini but ahead of Rolex.

Lisa Holladay, global brand leader at The Ritz-Carlton, sees luxury as being rooted in a combination of quality, comfort and elegance, alongside an element of scarcity, authenticity and, increasingly, distinctiveness.

She explains that whereas in the past luxury often felt prescribed, today it is defined by the customer and is therefore less formal, more personal and increasingly takes into account different tastes and cultural references.

The Ritz-Carlton in Langkawi stages the Dance of Thanks To The Sea

“As the world has become more globalised people are also searching for products that are authentic or unique. There is also an increased desire for transparency from brands, so consumers can seek out brands that align with their personal values,” says Holladay.

The Ritz-Carlton is focused on giving a destination-driven experience, which it believes the modern luxury traveller is seeking. For this reason each hotel is designed to tell a story and connect guests to their location. This was underlined by the company’s latest brand initiative #RCMemories, which sought to immerse guests in the local culture with events such as the ‘Dance of Thanks to the Sea’, a traditional dance which takes place at sunset on the beach at The Ritz-Carlton, Langkawi in Malaysia.

For its latest brand campaign ‘Let Us Stay with You’ the luxury hotel chain gathered thousands of stories about how its staff go above and beyond to create ‘wow’ moments, such as one employee working with a local tailor to replace the contents of a guest’s lost luggage when all the shops were shut.

Time is luxury

What consumers are searching for from the luxury experience is often determined by how they feel their time will be best spent, according to Alex Field, director of marketing at Reignwood, the Asian investment group behind the luxury members-only Wentworth Club golf resort in Surrey and exclusive Ten Trinity Square club in central London.

With these two properties, Reignwood is aiming to create the “ultimate town and country” concept. While Ten Trinity Square is a destination in the city for private meetings, and comes complete with a Château Latour discovery room for a glass of wine after work, members are then encouraged to relax over the weekend at the Wentworth Club.

Ten Trinity Square
The Château Latour discovery room at Ten Trinity Square, London.

Field believes modern luxury consumers crave an authentic luxury experience, an opinion informed by his time as global marketing director of premium shirt maker Thomas Pink and head of business development at Moët Hennessy.

“There has to be complete authenticity, it has to be the real thing. There also has to be an element of rarity and exclusivity. Finally, if [consumers’] time is so valuable, then that experience has to be perfect,” says Field.

“If you ask people, ‘how would you like to spend your time in the most luxurious way?’, are they going to go for a product, or are they going to go for an experience? My feeling is it’s an experience because it’s enriching their lives.”

He argues that in the luxury sector marketers need to dig deep into the authentic proof points of the brand, which often means starting with its origins. It is also crucial to define the brand’s personality and consider how it is positioned among its competitive set in order to demonstrate how you add value.

“If you’re not authentic [consumers] will see straight through you in seconds, especially when you’re charging the prices that sometimes we charge… If you are charging more then you have to be better,” says Field.

“There has to be value for money, probably even more so in the luxury market, because our members will know the benchmarks of most of these things. However, there is something that you can never put a price on and that’s the emotion you will get from the experience.”

Wentworth Club
Wentworth Club

The idea that experience is paramount to any luxury offer is shared by Zia Zareem-Slade, customer experience director luxury retailer Fortnum & Mason. From the expert butchers in the food hall to the ‘tea-ristas’ in the Diamond Jubilee Tea Salon, all staff are focused on delivering a personal experience for every customer.

Over the past few months Zareem-Slade has noted consumers becoming more considered in their spending, meaning brands in general have to work harder to stay top of mind. This is why telling a rich provenance story, combined with real product innovation, helps a heritage brand like Fortnum’s set itself apart.

“Customers are more interested than ever before in provenance and as a brand where all our products are of the highest quality and each boasts a unique story we are seeing customers being drawn to this, particularly in our food halls,” she notes.

“There is also a marked rise in customers’ desire for the new and unusual. From our recent innovation with Ruby chocolate to our Oddi-teas Gin & Tonic tea, Fortnum’s never stands still – and neither do our customers.”

Modern heritage

Blending artisan skill and heritage with a modern design aesthetic is the approach at British jeweller Boodles. Established in 1798 in Liverpool, Boodles is renowned for the quality of its gemstones and creative flair, which in 2014 became the subject of a Channel 4 documentary following the jeweller’s quest to create the “million pound necklace”.

The sixth generation of his family to run Boodles, marketing director James Amos joined the business in 2004 and has since managed the brand’s Harrods boutique, Dublin showroom and launched its ecommerce site in a bid to grow the brand nationally and internationally.

British jeweller Boodles is known for its choice of the finest gemstones.

He explains that Boodles always tries to design modern and exciting jewellery for a contemporary and mainly British audience, with a nod to its core values of individuality, modern femininity and heritage.

“All modern luxury customers come to expect a very high standard of design and craftsmanship when dealing with jewellery brands. Distinctiveness, heritage, timelessness and exclusivity on the other hand all play their part in setting the luxury brand apart,” says Amos.

“The word ‘experience’ however is key for me. It is a word that encapsulates so much, starting at the very first interaction and continuing for as long as the individual remains a customer. If the brand gets the experience right, a relationship can be formed.”

The brand talks about ‘The Boodles Experience’, which starts with the security guards welcoming the guest through the door. Far from being transactional in its approach, Boodles wants customers to feel like they have become a member of a club. They are invited to lunches, dinners, tennis events, the ballet and other bespoke parties throughout the year.

READ MORE: How one Savile Row tailor is translating the luxury experience online

Finding relaxation

Attaining a state of relaxation is vitally important to enjoying the luxury experience according to Siraj Singh, director of marketing and ecommerce at Edwardian Hotels London.

The hotel group, which owns The May Fair Hotel, the Bloomsbury Street Hotel, 11 Radisson Blu Edwardian London hotels in London and Manchester and a collection of restaurant and bar brands across the capital, is also in the process of developing a luxury hotel, spa and cinema concept in Leicester Square.

For Edwardian Hotels luxury is defined as a combination of beautiful surroundings and perfect service, a mixture Singh says enables customers to truly relax.

“We know that people cannot enjoy a luxury experience unless they are relaxed, and so luxury brands must attend to each and every guest’s individual needs,” she explains.

“The May Fair Hotel is known for its style and sophistication, and while it’s set in the heart of one of the most sought-after addresses in the world – it’s the seamless service that makes it a luxurious and desirable brand.”

The Mayfair Hotel
The May Fair Hotel

The personal touches are what helps a brand in the luxury experience space stand out says Singh, along with the desire to be a host and create a sense of belonging which is at the core of the Edwardian Hotels’ brand DNA. The company also believes it is important to establish its hotels in key locations, with each property designed to reflect the local environment.

“We are at a time of transformation in how people travel. As the world has become smaller, our expectations of how we travel have shifted and traditional hotel brands have been struggling to keep up,” she explains.

“Travellers, particularly visitors to global cities like London or Manchester, want to experience the neighbourhoods behind the tourist hotspots and to feel like a local, exploring off the beaten track. The human, authentic connection to a place is now seen to be more important than a traditional sense of ‘luxury’.”

The luxury market in 2018 is complex and highly nuanced. It is not simply enough to trade off heritage or exclusivity, modern luxury consumers want to understand why a brand deserves their attention and how it is going to enrich their lives.