Once characterized by exclusivity and other shared symbols of wealth and success, notions of luxury are now more fluid and nuanced. Today’s luxury consumer audience has become more discerning, eco-friendly and active across a range of channels. With this greater nuance, marketers have to stay agile and seek out insight-driven ways to engage these consumers and deliver messages that matter.
Developing an authentic connection with luxury consumers may seem challenging, but once forged, the relationships can be long-lasting. According to a 2023 study by Vogue Business in collaboration with Amazon Ads, 89% of luxury consumers said they take a more considered approach to shopping, giving brands ample opportunity to inspire their purchase decisions and develop relationships with longevity.
With luxury sales estimated to grow from $415.45 billion in 2023 to nearly half a trillion dollars in 2027 per Insider Intelligence, here are three ways to reach this evolving audience.
Lead with intention
As millennial and adult Gen Z consumers continue to drive global luxury sales growth, there is a higher expectation that luxury brands align with their values. According to the 2023 Higher Impact report from Amazon Ads, 65% of adult Gen Z and millennials say it is important for brands that they purchase from to be committed to sustainability.
The emergence of conscious consumerism has heralded a positive shift toward a greener planet with sales of U.S. Climate Pledge-friendly products in fashion, health and beauty, grocery and auto increasing 84% year over year, according to a Nielsen IQ report. By better understanding sustainable shoppers, brands can help ensure the impact of their messaging while also being confident that they’re reaching relevant audiences.
But connecting with an eco-friendly audience can be a complex task. One way advertisers can leverage this audience is on Amazon Marketing Cloud (AMC), which can help reach the conscious consumer and other evolving consumer groups, while generating unique audience insights. Additionally, by pairing Amazon Shopping Insights with AMC Audiences, brands can compose an efficient advertising media mix while reaching their desired consumers.
Leverage a multichannel approach
To cater to the evolving luxury consumer audience, brands need to have a holistic view across a variety of channels such as home devices and streaming services. Online streaming is playing a role in reaching niche audiences, with the Vogue Business study noting that 80% of consumers who shopped for luxury products in the past six months have a Prime membership and 75% tune in to stream their favorite shows as frequently as once a day.
“When it comes to meeting your consumers’ needs, a big part of that is examining your brand’s multichannel consumer journey and adapting accordingly,” said Nancy Hall, CEO of Mindshare North America. “For example, when a consumer is streaming a show, they may be scrolling through social media concurrently. Your brand should have consistent storytelling and messaging across channels to ensure that audiences see a consistent brand message—and that they have the opportunities to get more information or buy the product directly.”
This type of multichannel consumption is on the rise, and brands need to explore ways to inspire consumers across multiple touchpoints while also retaining their expertise.
Innovate in the face of uncertainty
The luxury goods category has continued to thrive amid economic uncertainty.
“Luxury audiences are not a monolith. Brands have to consider different consumer motivations and tastes that evolve as these audiences grow and society changes,” said Hall. “And as they consider what those varied motivations and behaviors could mean at different stages of the customer shopping journey, marketers now have to contend with a converged funnel, which requires a much nimbler approach.”
There is an opportunity for brands to reach out to a new generation of consumers who are highly driven by their values and beliefs. Two-thirds of luxury adult Gen Z and millennial shoppers engage with Amazon Streaming TV at least once a week and are 1.4 times more likely to “discover luxury brands or products” through awareness on streaming TV ads, according to an Amazon Ads survey.
Marketing strategies have to grow and remain agile, all while holding on to what made the brand a luxury must-have for consumers in the first place: a challenging proposition, but when done right, an immensely rewarding one.
—
Sunny Youn is a principal analyst on the global customer measurement and insights team at Amazon Ads. She has built a career in data analytics at comScore, Publicis/Epsilon and Group M, supporting advertisers across industries.
