Based on recent questions we have received about what’s really going on with Millennial consumers and their viewpoints on luxury and upscale products and services, werecently conducted a qualitative research study, “Millennials: Their Current and Future Need for Luxury,” in collaboration with The Luxury Marketing Council of Connecticut – Hudson Valley.
The exploratory study’s primary purpose was to lay the foundation for a more comprehensive understanding of Millennials' luxury-related passions, values, and buying habits in significant luxury and upscale markets. This study included both an online survey of 46 respondents and an in-depth, 90-minute focus group discussion with five accomplished Millennials (all from the eastern United States), concentrating on the following two topics:
More so than in the past, this key affluent demographic, upscale Millennials, described the word “luxury” using such negative terms as “expensive” and “unnecessary.” Also, some key attributes of luxury in the minds of the older generations — Gen-Xers and Boomers — such as “exclusive” and “designer” were not as important, if at all, to many of the Millennials.
Given this scenario, brands that market to affluent and luxury consumers had better pay close attention to how Millennials view upscale and luxury products and services. And when these less-than-positive descriptions come from Millennials — the future affluent consumers — how do they impact prospects for the affluent and luxury goods and services marketplaces in the future?
This challenge is even more daunting since most Millennials in this exploratory study, when asked about their need for luxuries, answered that they don’t need them. There were a few exceptions, as some respondents cited “quality” and “designer” as positive attributes of luxury. In addition, Chanel, Hermès, and Rolls-Royce were all mentioned as notable and recognized luxury brands, so there is at least some name brand awareness among this younger generation.
Notably, though, in this survey, not one American brand was mentioned as being among the top luxury brands. That said, this overall lukewarm interest in luxury is a clear warning shot across the bow of the affluent and luxury worlds, and its implications call for more innovative approaches to making a case for upscale and luxury products and services among Millennials … or that case may well be closed.