LESS CASH, MORE CURRENCY
Our Junior Planner, Matt Hayes, examines what 'luxury' means for a Gen Z audience
LESS CASH, MORE CURRENCY.
WRITTEN BY MATT HAYES, JUNIOR PLANNER AT ZAK.
Picture that guy – you know the one…
Eyeballs roll as he strolls triumphantly onto the miserable, sweaty tube, clutching an assortment of bright orange Hermès shopping bags under his Rolex-laden arm.
We know this character – Thorstein Veblen’s traditional ‘conspicuous consumer’. It’s an idea that the economist penned back in 1899, suggesting that those of a higher social status indulge themselves with expensive goods, in order to signal their wealth.
But for many young luxury buyers, things are changing.
Don’t get me wrong. I’m not about to claim that an entire generation have become a bunch of holier than thou do-gooders, swapping Chanel for charity shops. Just like Post Malone they still want to go flex – we are talking about a generation that managed to get Gucci Gang to 460 million plays on Spotify, after all. For today’s young people, luxury captivates and fuels the desire to indulge just as much as any generation before. In fact, they’re currently driving growth in the luxury market more than any other age group (Euromonitor, 2018).
What has changed is what ‘luxury’ means to them. The brands that they part with their cash for, are those that signal their personal values. Those that carry cultural currency, no longer just walking dollar signs.
We don’t like to use demographics here at ZAK, but excuse us just this once, as in this case there’s a scientific reason to do so…
16-24 is the period in which you develop your identity. The age you start to understand who you are and how you want to be perceived, as you become ever conscious of what others think of you.
What we wear is a big part of that. The clothes on our back say so much more about us than just our sense of style.
This is because living in a consumer society and digital-world has granted us access to a plethora of information at our fingertips. The exposure has created a depth of purpose amongst this generation. Greater knowledge has led them to value those that speak up for what they believe in – even if that goes against social norms.
In turn, this has created a demand for greater transparency from the brands that they buy from in terms of their values, sustainability and ethics.
Thus, what their clothes represent, is far more important to them than the price tag it carries. Blind materialism no longer cuts it. A £1,000 hoodie isn’t going to do much for your status, if the brand is known to be producing their gear in sweat shops. Splashing out on the priciest jacket in Selfridges won’t get you any cred with the guys if the brand has no connection to your shared culture.
Luxury has therefore taken on a new role for this generation. A shift has happened – brands have moved from the aspirational, to the inspirational. To resonate, they must represent their values, create and contribute to their culture and share their worldview.
You only need to look as far as some of this cohort’s favourite luxury brands to see this in action.
Abloh’s mass success with Off-White has captured the attitude of youth culture, raising a finger to convention with its ironic quotation marks, whilst Supreme’s £1,000 brick follows a similar theme. Nike (yep, they’re a luxury brand now) even managed to raise their market value by $6bn after taking a bold stance on social issues with its latest ‘Just Do It’ campaign, featuring Colin Kaepernick (of course, there were other contributing factors). Meanwhile, Gucci has shown its commitment to purpose with its sustainability program, Gucci Equilibrium, whilst Stella McCartney’s range is now 100% vegan.
Likewise, brands that inspire this generation to broaden their cultural horizons, opening doors to new communities and experiences, are garnering success. This is because, unlike generations before them, young people today no longer subscribe to any one thing. They pick and choose from a wide range of culture, all feeding in to contribute to their ever-changing identity. Just look at the UK top 40, for example. At the time of writing, the vast majority of songs feature collaborations from two or more different artists, demonstrating this insatiable appetite that young people have for the amalgamation of culture.
Taking this collaboration appeal into account, brands have explored different approaches.
Gucci teaming up with Trevor for ‘GucciGhost’ drew on shared creative vision, whereas others have recognised the value in creating something totally off the wall, such as Vetements collaborating with DHL (yes, the logistics company), or Off-White collaborating with… well just about bloody everyone. Those that meld culture and open up new worlds are capturing both eyeballs and wallets.
But, there’s more to it than just buying expensive gear. They are buying into the brand in its entirety – the lifestyle, the culture and community behind it.
In fact, they’re no longer just buying, but earning exclusive luxury products through active participation in a brand community. This generates scarcity, competition and FOMO – which lends itself well to the dopamine-seeking world of social media that they have grown up native to.
Whether it be tirelessly waiting in the Supreme queue, trying to cop the latest exclusive brand collab, or attending a launch event for the drop of some new kicks – being there in the moment (and the bragging rights that come with it) is what matters.
This has all helped create a more inclusive meritocracy to luxury fashion, where effort and knowledge are king. Those who are in the know about the date of the next drop, or have access to exclusive product are able to get ahead of the game, with a lower cost to entry. This has created a massive resale market, with those known as ‘Hype Beasts’ using their fanaticism to sell to those who are willing to pay extra for access to these exclusive products and the validation that comes with it.
So, where does this leave us? What can we learn?
Whilst Veblen’s ‘conspicuous consumer’ still very much exists (and we’ll admit there are some younger consumers still leaning into this form of consumption), brands cannot rest on their laurels. 45% of the luxury market is set to be made up of Gen Z and Millennials by 2025 and what these generations are looking for in luxury brands is largely, changing. Brands need to consider how well they are reflecting what luxury really means in 2019.
Brands that are succeeding in this space have changed their approach. They understand that today’s younger consumers are not just buying conspicuously, they realise that they need more than that – whether it’s Supreme and Off-White flipping the bird to society, or Nike boldly showing their stance. They’re buying into a value system and outwardly communicating it through what they wear.
But is this exclusive to luxury? We’re not so sure…
We’re not for a minute about to make any ludicrous discipline-altering claims. Nor are we about to suggest that all young people will respond to brands following this approach. Far from it. Believe us, here at ZAK, we’re just as fed up as you are with that kind of sensationalist lark clogging up our LinkedIn feed.
Yet whilst I doubt you’ll have much success getting young people to buy into the value system behind your brand of loo roll… there may well be value in brands exploring this changing mindset of young consumers beyond luxury. If your brand plays a role in defining or signalling young people’s identity, can you really afford to blissfully ignore their worldview?
To wear, use or simply buy your product, young people are placing an enormous amount of trust in your brand. They are trusting you with communicating their identity. Thus, they must be confident that your brand reflects and communicates who they are, or want to be.
If you’re not contributing to their culture, you’re not earning currency… so how do you think you’ll win their cash?