Prestige alone is no longer enough to impress younger generations of customers. Daimler and Virgil Abloh show how to reach millennials and Generation Z with “Project SUV”.
By Lutz Dietzold.
The consumers of luxury goods are increasingly younger in age. Gone are the times when someone’s house or car was their number-one identity-defining characteristic. The phrase, “Tell me about your house and I will tell you who you are,” has ceased to apply. Millennials are driving the market, with the nineties-born Generation Z’ers hot on their toes. According to a study by consulting firm Bain & Company, they will even be responsible for 55% of global luxury-goods sales in 2025*. We are already seeing impressively how familiar brands are opening up their strategy for these new target groups, with Daimler and its “Project SUV” presented in September 2020 being a prime example. Fashion designer and creative director Virgil Abloh incorporated his impressions of future stylings into the conceptual vehicle design. Collaborating with the Mercedes creative division, they came up with striking ideas. The media called the project “a wild design study” which draws precisely the attention that established luxury brands demand for themselves. This makes it clear how strong the target group’s influence has become and how its purchasing power puts pressure on brand strategists.
Are brands ready for this new target group? What can we learn from them? These findings will help you with the answer.
#customerexperience #communitymatters
It is no longer the shopping experience that stimulates the new target group’s decision on a product. Online sales during lockdown offer evidence of this, as e-commerce features neither specialist advice nor brand-directed product presentation. The new target group does not show off the luxury goods’ desirability until the post-purchase stage, when the consumers present their product on social media. All the more important for brands are their own channels such as Instagram and YouTube, which interact with these consumers and extend their presence within the brand world. This customer experience is what creates brand loyalty among young consumers. Contests and Q & A sessions for product questions prompt users to engage with the product. The exchange generates a connection and loyalty to a community of like-minded people.
#hiphop #virgilabloh #mercedes
The times of silent consumption are gone. This young category of shoppers is actively stepping into the branding universe and acting as a designer. Be it stripes, colours or the buyer’s initials, new products are undergoing the individualisation expected by millennials and Generation Z based on the style of their consumers. The symbolism of integration is not to be underestimated. Even hip-hop culture has added fire to luxury brands in countless songs over the last ten years, essentially declaring these brands’ products as trophies of “belonging” within the community. Strategic alliances with identifiable personalities who bring spark to the creative process, such as Virgil Abloh, make brands accessible for new communities, as his design language belongs to the communities’ culture. For brands, this signifies a radical shift in thought. Each generation defines the motives and drivers of consumption based on the way they were socialised and on individual, personal experiences. Generation Z shows us radically that they are the best advertising medium a marketing team could ever wish for. On the other hand, though, Generation Zers are already considerably more demanding than their parents’ and grandparents’ generations, not least in their need for attention.
#nachhaltigkeit #socialresponsibility #sustainableluxury
Their demands to protect the climate and firmly establish sustainable production processes are also manifested in their sense of expectation as consumers. Sellers offering customers a “green investment” with their purchase increase the chance of loyalty by multitudes. The strong effect that luxury brands have illustrates again how highly their young followers regard the manufacturing concept and production expertise. Outstanding quality is the basis for long-lasting products. However, only brands that actively address issues in society and initiate their own transformation process can keep up with the times. Videos that show a transparent manufacturing process and investments in sustainability and circularity establish authenticity and credibility. The “purpose” of a brand becomes its seismograph. The young generation’s approach to life is burdened by a social responsibility of having to initiate a directional change through their consumption. A direction towards more meaningfulness and a role model function for a better society. Experienced together.
Get ready. Prestige is in the past now.
The author: Lutz Dietzold
CEO German Design Council
Lutz Dietzold (*1966) has been CEO of the German Design Council since 2002. Prior to that, he worked as a design communication freelancer and was managing director of Designzentrum Hessen (Hesse Design Centre), where he was responsible for the strategic reorientation of design promotion.
Grounded on his studies of art history, classical archaeology and German language and literature in Frankfurt Lutz Dietzold has gathered extensive experience of design, branding and innovation. He also has a special interest in promoting design and up-and-coming designers. In 2011, he became a member of the advisory council of the Mia Seeger Stiftung (Mia Seeger Foundation) and a member of the Stiftung Deutsches Design Museum (German Design Museum Foundation), subsequently taking on the role of chairman in 2020. He was appointed to the Dieselkuratorium’s Board of Trustees in the same year and is dedicated to strengthening the pioneering role of commercially successful innovators.
Lutz Dietzold is also working to increase the international orientation of the German Design Council and its global network of leading companies from industry and the business world. This includes setting up a subsidiary in China.
Lutz Dietzold publishes articles on a regular basis and gives national and international lectures on a variety of topics. He is also a member of numerous committees and juries and sits on the project advisory board of the German Federal Ecodesign Award of the Bundesumweltministerium (German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety).
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