Luxury is no longer exclusive to the super-rich, as the luxury retail market realizes it must go mainstream. We believe the future of the luxury industry is dependent on multicultural consumers . . . specifically Hispanic and African American millennials. And as this evolution takes place, the underlying meaning of “luxury” is also changing, for these consumer segments.
So what does luxury mean to today’s luxury retail shoppers and what are they really looking for? African Americans and Hispanics associate different meanings and value around the term “luxury,” and their purchasing behavior within the luxury market differs as well.
Luxury is often a way for consumers to signal that they’ve “made it” or “I’m someone of importance.” There are countless ways for different segments to express that. For example, some consumers express status subtly through the scarcity and heritage of the products they purchase. Others express it by purchasing eye-catching products that they want to showcase to friends, family and admiring audiences
In many cases (and we’ve seen this first-hand), when Hispanics and African Americans deem something to be luxurious and they decide to flaunt it in a flashy manner online or offline that luxury item and/or service along with that their flamboyancy becomes viral and adopted many times by general market consumer segments. It is through these unique cultural expressions of luxury that a brand can truly gain a competitive advantage in the market.
We believe luxury brands who target minorities will garner more attention from multicultural millennials. The fact is this demographic has a wider range of options to bring their business to. Luxury brands are by no means out of the question for the millennial multicultural consumers, but not under frivolous guises. However, multicultural millennials will purchase luxury items above their budget if they feel connected to a brand.
This means the more targeted a brand’s advertising is to an ethnicity, the more popular it will be with the multicultural millennial. They think highly of a brand that caters directly to them and prefer it.