5 Ways Luxury Beauty Brands Are Shifting Their Marketing Strategies
Yves Saint Laurent. Tom Ford. Giorgio Armani.
Just reading these names probably makes you think of one thing—luxury—and the reason for that is the effective luxury marketing these brands do. But what happens when times change and the luxury beauty brands that have withstood time now have to rethink the way they market themselves? By staying on top of market trends like the five we uncover below, luxury brands can move away from outdated marketing strategies and take a promising look into the future.
What Is a Luxury Beauty Brand?
When you think of a luxury brand, you think of high end products or goods. When it comes to luxury beauty or skincare, it’s the luxe packaging, the dreamy-looking formulas developed through extensive clinical testing and research, and that all-too-familiar urge you get to splurge. There is a certain indulgence you feel when looking at a luxury brand advertisement or social media post because of the allure they successfully create. Luxury doesn’t exclusively mean expensive, though — it means there is a certain quality, rareness and aesthetic to the brand that makes it feel luxurious.
Luxury Market Trends on the Rise
No matter the product, luxury beauty brands have a loyal consumer base. But in a world where conscious consumers want a bigger emotional connection with the brands they’re buying from, these brands are continuously looking for ways to attract new customers and stay relevant. Here are a few standout ways that luxury brands are shifting their marketing strategies in 2021.
Selling With Purpose
In many ways, when the global Covid-19 pandemic started in 2020, it forced all brands to take a step back, take a look into the future and realize that adaptation to a “new normal” was unavoidable. Staying relevant requires much more effort now than it did in the past, and just having a luxury name might not be enough for real staying power anymore.
Today’s consumer wants to feel good, not only about themselves but about the way they spend their money. This requires luxury brands to shift from being brand-centric to customer-centric. It means shifting the narrative from selling the status of owning a luxury product, to selling the quality of a luxury brand purchase. Consumers are now more willing to spend money on fewer, better-quality items that will deliver the quality they are looking for rather than opt for the cheapest options.
Beyond quality, consumers want to know that the brands they are purchasing from have a true brand purpose. Besides being customer-centric, they want to know that a brand is community-centric, meaning that they contribute to their communities, to society as a whole and are committed to authenticity. Today’s consumers make carefully considered choices to buy from brands that reflect their individual values and beliefs — from mental health and wellbeing to wider concerns like climate change. Purpose-driven companies ultimately cultivate deeper relationships with their customers because they not only demonstrate that they are listening to their audience, but are taking actionable steps to align their brand with their values.
Luxury beauty brands have relied on presenting themselves with an allure of exclusivity for a long time, but that illusion of exclusivity is steadily fading. New demographic markets are becoming increasingly important for the luxury industries which have long felt too exclusive. Not just on a marketing level, but on a corporate level as well, luxury brands are finally pushing for greater diversity in the workplace and representation in their marketing and many are making pledges to hold them accountable to those promises.
Many luxury beauty brands are beginning to target markets that are now integral to defining the future of inclusive beauty. From gender-neutralized personal care and beauty routines, to expanded formulas and shades to include the widest range of skin tones, to spotlighting older age cohorts beyond the younger generations, brands are targeting the disparities in traditional beauty products in order to invite long underserved markets.
As environmental concerns grow, consumers are now more than ever shopping with consciousness and sustainability in mind. So it’s no surprise that so many brands have announced their commitment to be more environmentally sustainable or ethically source their materials over the last few years. Now more than ever, we are seeing brands implement real changes and actively working to reduce their carbon footprint.
Marketing trend or not, luxury beauty brands are finally beginning to realize their impact on our environment and are dedicated to making a change for the better. They are shifting the way they formulate their products, source their ingredients, and even produce their packaging. The eco-conscious consumer nowadays cares more about what their purchases say about them as a buyer and their values vs. the status that a luxury label brings.
Next Generation of Buyers
It’s clear that the buying power of millennials and Gen Z is not going anywhere. The total luxury market is set to hit $1.5 trillion by 2025, and by then, millennials will make up 50% of that market with Gen Z close behind (Source: Matter of Form). Adjusting the way brands approach their marketing to these generations will be crucial to their success for years to come.
Millennials and Gen Z are a huge part of the new digital era. They are engaging with online communities and content across multiple channels at all times of the day. Not only are they plugged in more than most, but their expectations are higher when it comes to marketing because of this constant digital stimulation. We’re living in a time of highly curated feeds, content, and experiences, and a luxury brand’s marketing strategy should be delivering the type of digital experiences these generations respond to.
The Ecommerce & M-commerce Shift
The last trend that has been a constant one for years is the dominance of ecommerce. Consumers are increasingly becoming online shoppers, for everything from household items to luxury goods, so the rise of ecommerce is full force.
Accelerated by the global pandemic and the slower foot traffic in physical store locations, many luxury brands are realizing that ecommerce is here to stay and is only going to become more prominent, especially as users increasingly use their mobile devices to make purchases. Also known as “m-commerce”, mobile ecommerce is expected to grow rapidly. As of 2020, the U.S.’s mobile retail commerce revenue hit $338 billion, making up 31% of the total of digital commerce spending (Source: Statista), and it’s only projected to grow from there.
There are numerous trends that emerge every year that continue to change the way we think about our marketing strategies and our brands as a whole. It’s not enough to change a few marketing tactics just to bend to trends — brands need to embrace these shifts in an authentic way so that consumers feel good about engaging with them.
While all of the shifts we discussed are equally important, perhaps the most dominant trend of all is the shift from an in-store experience to an online experience with the rise of ecommerce. With astronomical increases in ecommerce and the global pandemic contributing to an additional $105 billion in US online sales (Source: Digital Commerce 360), luxury brands now more than ever are realizing that there is real growth potential on large online retailers like Walmart, Target, Kohl’s, and the leading global marketplace, Amazon. Where luxury brands once hesitated, they are no longer turning against the enormous customer base these retailers can offer them.
Take Amazon, for example. We mentioned foot traffic has decreased significantly in-store, and now brands are looking for greater customer access as consumers increasingly look for the convenience of online shopping. In recent years, luxury brands have been reconsidering Amazon marketing as part of their overall high-end marketing strategy as many luxury retailers are witnessing the surge in digital demand.
What most luxury brands hesitate with when considering an online marketplace like Amazon is the loss of brand control, cheapening their brand identity and losing that feeling of luxury their consumers are used to. However, what they don’t realize is that with the right branded experience on the Amazon marketplace, brands are able to uphold that feeling of luxury without diluting their brand identity while also growing their sales. And for those brands who don’t know where to begin, partnering with an agency with deep Amazon expertise can mitigate that initial hesitation and actually open them up to a larger scale audience than ever before.