Why sustainability needs to be at the heart of the new luxury
By Olivia Sprinkel, Head of Salterbaxter North America
Time for Luxury 2.0. This was the theme of the Luxury FirstLook 2017 conference. As stated in the opening remarks, maybe this should have been really called Luxury 3.0. But what is this new luxury? And what does it have to do with sustainability?
There was one session during the day which was explicitly on the subject of sustainability, focused on ethical transparency, with panelists including De Beers’ Forevermark. But sustainability was also a theme that ran thoughout the day. Here are my 5 key takeaways:
1. Sustainability is part of how consumers are defining the new luxury
‘Sustainability’ was identified as one of the emerging words of how the definition of luxury is changing. Other words included in this new definition were ‘cutting edge design’, ‘highest quality’, ‘functional’, ‘craftsmanship’, ‘long lasting’, ‘one-of-a-kind’, and ‘unique’. All of these, but in particular ‘craftsmanship’ and long lasting have a close relationship with sustainability. And millenials and looking further ahead Gen Z will be looking even more to this new luxury, with a continued shift away from conspicuous consumption. At Salterbaxter we see a big opportunity for luxury brands to elevate their storytelling around craftsmanship and sustainability to differentiate and appeal to the consumers of the new luxury.
2. Luxury is about connecting on a human level — ‘make me feel’ and ‘involve me’
People want the emotional connection. They want a personal experience, not a mass experience. And in relationship to sustainability, brands need to be able to tell the sustainability story in a way that makes the human connection.
But it is not just about the brands telling a story and how they make consumers feel. It is about involving the consumers, and recognizing the rise of the maker culture. Dave Rodgerson of Microsoft spoke of the new community of makers — ‘the consumer of the future is a builder and collaborator’. And not just of the future, but of now as well — they want to collaborate and share ideas. And they also want to be part of a community, want to be part of something larger than themselves. So how can you bring these makers into a conversation linked to sustainability?
3. The shift from four Ps to four Es
The four traditional Ps of marketing are Product, Place, Price and Promotion. Pam Danziger of Unity Marketing spoke of how these been redefined as the four Es.
Product — Experience
Place — Every Place
Price — Exchange
Promotion — Evangelism
This led me to reflect on the role of sustainability within these four Es.
Sustainability can be a key part of the experience that you offer to the customer. The store is a key part of the experience- they are no longer stores but ‘high performance relationship building centres’; they are ‘influence points’, not just distribution hubs. Sustainability can be part of the experience, from how the store is designed, to the digital storytelling in store, through to the relationships.
And sustainability adds to the entire value exchange with the brand. The example that was shared here was of Naadam, an ethical cashmere brand, who, similar to Everlane, are transparent about their pricing. So not only do you get your cashmere sweater at a good price, you understand that the Mongolian farmers who supply the cashmere are getting a better price than from a traditional retailer. ‘Values = value’, as Danielle Vega of Selfridges said, quoted by Dave Rodgerson.
Which leads to customers becoming evangelists. If they have a good story to tell, then they are more likely to tell that story. And sustainability can be that good story to tell.
Pam Danziger spoke of how luxury needs to ‘dramatically redefine the marketing strategy’. And in order to dramatically redefine the marketing strategy, then there needs to be a change in what brands do, so that you can provide that additional value in the exchange and the experience, and provide a good story to tell. As we say at Salterbaxter, in order to say things differently, you need to do things differently.
4. There is also a fifth P — Education
Another theme that emerged during the course of the day was another ‘e’ — education. Ken Nisch, Chairman, JGA, characterized the shift in consumer mindset from acquisitive to inquisitive. And if consumers are inquisitive, then it is to the advantage of the brands to help educate them. Arthur Ceria, CEO of CreativeFeed, spoke of the fascination for education — ‘make me think, make me learn, make me grow’. Again sustainability is perfect content for this. And Tracy Doyle, creative director for fashion and luxury, The New York Times’ T Brand Studio, gave the example of content they have created for Tiffany & Co. around educating people on the Whitney Biennial through short films. Education can also be through a physical brand experience. 1 Hotels, who describe themselves as the first ‘mission-driven’ hotel chain said that in a customer survey, 49% of customers said that staying at the hotel had changed the way that they approach sustainability at home. So, for brands, to think about — how can you influence and inspire your customers to change behavior, in an entertaining way that is appropriate for your brand?
5. Using emerging technology to connect with consumers in new ways
What storytelling there is around sustainability tends to be, well, traditional. A couple of different approaches were mentioned that could be interesting to explore for sustainability storytelling. Dave Rogerson mentioned the trading cards produced by Tim Hortons, a coffee shop chain in Canada. If you download an app, you can scan the trading cards and the cards will come to life with a video clip. This kind of technique could be used to engage customers with the story of how their new purchase has been made — and to provide a narrative around a product. As Tracy Doyle of the New York Times said, luxury and fashion traditionally hasn’t had much of a narrative. Luxury and fashion brands need to learn how to tell these stories — and, once again, sustainability, providing you have a good story to tell, provides the content for that story.
Is Luxury 3.0 a new luxury that leads the way in ethical practices and communicating with their customers? Let’s hope so.