The Pandemic Has Proven That Luxury Isn’t About Products—It’s About Connection

Shoppers who once scrolled Instagram for the next "it" handbag are now spending time scouring Amazon for hand sanitizer. In a year when the focus shifted abruptly from what's aspirational to what's essential, luxury brands are looking for a new way forward. It's no small task: Consumers are spending less amid a global pandemic and economic uncertainty, according to data from PayPal and Vogue Business. Luxury sales in particular have dropped 21% as shoppers curb their spending and focus on practical goods like cleaning supplies, face masks and sweatpants. Now, high-end brands are rethinking how to speak to customers in a time when there’s undeniably less need for their products. A number of luxury players say the key to survival is creating a trusted relationship with consumers and nailing the digital shopping experience. Direct-to-consumer (DTC) luxury brand Cuyana, fashion label Cult Gaia and leather goods purveyor Senreve, for example, all said they've withstood the worst of the crisis because of their DTC operations. Jasmin Larian, founder and CEO at Cult Gaia, noted that when wholesale partners canceled orders in the pandemic, DTC channels let brands keep moving product. “There's a realization on the part of both brands and consumers that opulence really is over,” said Milton Pedraza, CEO of consulting firm Luxury Institute. Since luxury brands are most often associated with elements of life that the pandemic has disrupted—namely travel and entertainment—this idea only makes sense. To be conscious of this shift, Cuyana, which usually focuses on women’s clothing and accessories, halted product-focused marketing entirely. Any temporary loss in sales was worth shoring up the trust of its customer, according to founder and CEO Karla Gallardo. “We knew that our customer was going through a lot,” she said. “What we could do as a brand during those moments was to support her, and that would enable us to build a stronger relationship with her.” Cuyana switched to lifestyle-focused marketing, designed with the current moment in mind. It was “content around slow living and purposefulness,” said Gallardo. That sort of messaging, Pedraza said, is what being a luxury brand is actually about. “This is a reinforcement that the opulence of luxury is not as important as the relationship you have with that client,” he said. “That human relationship in luxury matters tremendously to drive sales.” Luxury Lessons From the Pandemic Lean on content When marketing product feels tone deaf, Senreve turned to content, relaunching the brand blog where it shared everything from cookie recipes to other brands the team had discovered. The idea, Chung said, was to provide “uplifting content that’s inspirational, informative, interesting and brings them out of a slump.” Change your mindset For a long time, luxury was exclusively aspirational for many consumers, and that was part of its appeal. But now, Larian said brands have to think differently about what luxury means. “It’s a luxury now for someone to be able to buy a silk gown from us at an affordable price point,” she said. Adjust your lineup When it became clear that Americans wouldn’t be living their normal lives for a while, Cuyana worked with its factory partners to adjust its product drop schedule. “We transformed our product calendar to align with what the consumer needed during this time,” said Gallardo. Wendy Wen, co-founder and COO at Senreve, said the company produces a limited quantity of items based on demand, and it's been hard to keep products in stock during the pandemic due to factory shutdowns. But a close consumer relationship helped Senreve navigate that setback, according to Wen. “We have built up a lot of goodwill and a strong community with the women who really support our brand,” said Wen. “They were incredibly understanding about longer wait times and things like that.” At the outset of the pandemic, Coral Chen Chung, Senreve’s other co-founder and CEO, said the brand completely pulled back on marketing, assuming consumers are less interested in their signature product, a bag for women on the go. Instead, they focused communication on charitable efforts such as providing support for healthcare workers. Though product plays an undeniable role in attracting customers, Larian said, what truly catapults a brand in the luxury category is a thoughtful relationship. Making sure consumers still felt a high level of care in the early days of the crisis mattered, especially when the most traditional channel for luxury purchases (stores) wasn't an option. “Luxury is a feeling. Luxury makes people feel special," said Larian. "That's why engaging with customers is the new luxury. We’re giving them something that other people aren't giving them.” Read Next: Luxury With Free 1-Day Shipping? Amazon Sets Its Sights on Upscale Retail