By Courtney Iseman, New York Contributing Writer
At this year’s L2 Generation Next Forum, Sterling Lanier gave an audience of luxury brands and marketing departments the run down on the Five Things Prestige Execs Need to Know About Gen Y. Lanier is the president of Chatter, a market research consultancy.
1. Gen Y sees luxury as an investment, not an indulgence.
Other generations see luxury purchases as an indulgence – “I’m going to treat myself to this.” They saw luxury as something completely unnecessary, but nice to have if a lifestyle permits it. Gen Y, on the other hand, sees luxury as an investment, and more of a necessity. Lanier pointed out that Gen Yers told him they “need” to stay at the Ritz in Hawaii because they work long hours every week, and need that relaxation to keep working hard.
2. Gen Y are “equal opportunity buyers.”
Gen Y is a lot more open-minded to luxury brands than previous generations. The most important factor in seeing a brand as luxury is quality, and that can come from a brand that is older, more established and more traditionally seen as a prestige name, or, it can come from a new brand that is effectively putting forth the message that its product is high quality and desirable.
3. Gen Y rationalizes exuberance.
Gen Yers seek to sort of justify luxury purchases. This goes hand in hand with their view of luxury as an investment instead of an indulgence. Luxury purchases are not and cannot be frivolous, treat-myself purchases. They have a purpose, and they are necessities. When a luxury buy is needed and fulfills a Yer’s purpose, it is considered a smart buy. For example, a young woman doesn’t want to say she bought a designer suit just because it’s her favorite designer and she thinks the suit is just lovely.
4. Ostentatious is out.
Gen Y is all about being “in the know,” or in the club. Lanier found that young adults value exclusivity in their luxury brands. They love brands that are only available in a few different places or venues. They steer clear of logos plastered on their clothes and accessories, and instead appreciate less obvious symbols of the brand that only those in the know about that brand will recognize. The exclusivity makes the purchase seem smarter and makes the Yer seem more of an expert in that product.
5. While Gen Yers are open to including more brands in their view of luxury, they only want to associate the luxury brand with its initial product.
Lanier gave Armani hotels as an example. While Yers would be welcoming to include Armani in their view of luxury, they would group Armani as a luxury clothing brand. They would have a hard time seeing Armani as a luxury hotel brand. Therefore, Lanier advised to prestige brands the importance of showing a deep expertise instead of a broad expertise. In other words, because of Gen Y’s emphasis on smart shopping, they are more likely to shop a brand that shows true expertise in its product, and less likely to shop a brand that keeps venturing into different products and services without proving a true expertise for each venture.
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