Luxury Consumer Behavior After The Pandemic

Goals

  • Forbes reports that prominent signs of wealth and success are not as important to luxury consumers as they were before the pandemic. These consumers are now more concerned about "brands’ attitudes towards workers, the environment, fair wages, local production, charitable giving, disadvantaged people and many other things".
  • According to Sarah Willersdorf, the global head of luxury at Boston Consulting Group “Covid was the first time that a lot of people realized that their individual actions have societal consequences.” As a result, brands will need to include sustainability in their packaging, products and delivery systems.
  • A study by Walpole and Hearst found that, due to the pandemic, mass reach is no longer appealing to luxury consumers. They prefer intimate and personal connections. In fact, "54% of consumers are noticing influencers more."
  • The way in which luxury consumers prioritize luxury spending is also expected to change after the pandemic, according to Statista. The percentages of luxury consumers in different countries that will prioritize luxury spending after the pandemic are as follows:
    • UK: 3%
    • Germany: 2%
    • Italy: 1%
    • Spain: 2%
  • Another observation in some parts of the world is luxury consumers indulging in 'revenge buying' to uplift themselves. In China, for example, the Hermès’ Guangzhou flagship store generated $2.7 million in sales post lock down, their largest sales yet.
  • There is also an increasing shift towards affordable luxury due to the financial implications of the pandemic. Affordable luxury is whereby "consumers look for the status associated with luxury, without encountering the high price tag." 30% of luxury consumers globally who delayed buying luxury items due to the pandemic plan to look for flexible payment options after the pandemic; this is 54% more than before the pandemic.

Summary

There is a lot of information in the public domain regarding how the behavior of luxury consumers is changing due to the pandemic. However, there is limited data on quotes from academics. We have, therefore, expanded the scope of this to cover thought leaders in the industry as well, such as the heads of luxury at companies. We believe that expanding this scope and following the proposed next research steps below will provide valuable insights.

Early Findings


we will compile quotes from academics about how COVID has fueled a search for values, purpose among wealthy consumers
we will also compile recent news and media articles that talk about how spending has changed among wealthy consumers. we

Research proposal:

Only the project owner can select the next research path.
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