By now, everyone should be aware of the power of storytelling for brands. Stories have a profound impact on our beliefs, triggering emotions, igniting desires, and shaping behaviours in ways that sales marketing alone cannot.
If you need more convincing, just look at the latest stat: 92% of consumers want brands to make ads that feel like a story. 68% of consumers say that brand stories influence their purchasing decisions. 55% of consumers are more likely to remember a story than a list of facts.
But in no other category is this more relevant than the luxury goods and experiences category. And here’s why….
In no other category is storytelling more relevant than the luxury goods and experiences category.
There is no objective reason why a Louis Vuitton handbag should cost a lot more than any other well-made bag from an average high street store. We could compare design, construction, quality, practical features, wearability, comfort, style. We could judge them against current cultural trends – sustainability, responsible sourcing. We could check if they were made from cruelty free materials or vegan leather (incidentally, Louis Vuitton’s are not). There would likely be no difference at all.
The difference is not in actual value. Luxury prices are defined by perceived value.
That’s where storytelling steps in.
Read our insights on how to break through the luxury market and enhance perceived value through the power of a compelling luxury story.
The story of provenance
Certain things go a long way in establishing perceived value of luxury brands. The story of provenance is one of them.
Provenance, the origin and heritage of a product, has long helped popular luxury brands like Chanel and Aston Martin maintain their status at the top of the market. List the top five luxury brands you can think of, or even the top ten – they will likely all be from France, Britain, Italy, Switzerland, Germany.
The characteristics that we traditionally associate with the luxury story – quality, beauty, exclusivity and status, exquisite detailing and craftsmanship – have also come to be associated with specific places. Brands that hail from one of these places would seem to have a head start.
But recently, with the rise of social media and influencer marketing, a new segment is driving the luxury market – and with it, an entirely new set of characteristics with which brands can tell a compelling luxury story.
The new luxury customer
As these figures suggest, the modern luxury customer is changing. By 2026, Millennials and Gen Z are expected to account for 75% of luxury goods buyers. Fascinatingly, even in the face of economic turbulence, these younger generations are shown to spend 15% more than other age groups.
The modern luxury customer is changing. By 2026, Millennials and Gen Z are expected to account for 75% of luxury goods buyers.
As the generations who grew up in the era of social media, these figures are hardly surprising. Social media provides us with a platform to share and increasingly curate every aspect of our lives, shaping what we want people to see and think about us. As luxury brands began to sponsor influencers to promote their products and experiences across their social channels, the rise of the luxury lifestyle generation emerged.
It’s a generation of young, aspirational, mostly middle-class customers who don’t necessarily have the financial capacity to live the luxury lifestyle full-time, but increasingly want to be able to dip into the luxury market, purchasing the occasional luxury product or experience to showcase on their socials. It’s no longer the ultra-we-althy who are driving luxury sales. Today, anyone with a social media account and a bit of creativity, can emulate the sense of luxury, dramatically expanding the luxury market’s audience pool.
This presents both an opportunity and a challenge for luxury brands. On the one hand, the rise of the luxury lifestyle trends on social media gives brands access to a greater than ever market of potential customers. But as social platforms become more congested, and the algorithms become ever more adept, luxury brands must compete with a torrent of other brands vying for customers’ attention.
The need for a compelling story – one that leans on the characteristics Millennials and Gen Z audiences care about – is key to cutting through.
The new luxury story
Crafting the right story for this new luxury customer begins with understanding what luxury truly means to them.
What Millennials and Gen Z expect from luxury brands is radically different from previous generations. Provenance still matters to some extent – but these new segments are more interested in originality than origin.
What Millennials and Gen Z expect from luxury brands is radically different from previous generations.
We see more and more luxury brands seeking originality through innovative collaborations. As generations raised in streetwear and celebrity fandom, luxury brands increasingly find success through unexpected, youth-inspired pairings – Louis Vuitton and Supreme, Adidas and Kanye West, Chanel and Pharrell. The same model is being used for the reverse – where brands from outside the luxury sector find ways to engage with the new luxury customer by pairing up with celebrities and designers that lend them a certain level of prestige – the Off White and IKEA collab comes to mind.
Moreover, with the rise of consumer consciousness, luxury brands that credibly demonstrate their commitment to sustainability and social responsibility gain the trust and loyalty of these generations.
The way Millennials and Gen Z interact with brands is changing too. They are no longer satisfied with the purely transactional experience; they want to be part of the brand universe. Brands that craft their universe around the worlds their audiences desire to inhabit have a greater chance of capturing their hearts, and their loyalty.
When luxury stories get it right
In today’s changing luxury landscape, storytelling has never been more important. With new Millennial and Gen Z audiences dominating the marketplace, a compelling story that is both authentic and original matters more than ever. To compete in saturated social channels, the right story can stop your customer from scrolling past you.
To compete in saturated social channels, the right story can stop your customer from scrolling past you.
Whether you’re selling high fashion, precious jewellery, fine watches, luxury foods, automobiles, or top hotel experiences, taking the time to understand the emotional drivers of the modern luxury customer is fundamental to crafting a story that is fine-tuned to trigger them.
To help you get this right, read how these brands have incorporated strategic storytelling campaigns to elevate their luxury status.
- Accessibility and aspiration – The Nespresso success story
Nestlé’s invention of Nespresso in the 90’s, with their sleek, easy to use capsule system, made quality coffee accessible to everyone and thus changed the way we drink coffee. But it wasn’t until 2006, when George Clooney became the face of Nespresso, that the brand became a super-cool, luxury brand that the aspiring classes just had to own.
How could a humble instant coffee machine become the next luxury item and status symbol? Stories.
The campaign saw George sipping espressos in fine European cafes or lounging in his elegant kitchen, exuding sophistication and class. For many, owning a Nespresso machine thus became a way of bringing a touch of glamour and refinement into their own homes.
- Holistic luxury experiences – Learning from adjacent sectors to help Bentley redefine the luxury automotive experience
From a product point of view, Bentley’s automobiles are absolutely faultless. Despite that, when Bentley came to us, their sales were stagnating.
If you are wealthy enough to select the Mulliner option – where Bentley will, for a handsome fee, create just about any kind of customisation you could ever dream of – it is considered the pinnacle of luxury. But that was the only place you could find it – inside the product. The surrounding experiences – the sales funnel experience, the dealership experience, the motor show experience – were nowhere near the standard of the product. This was the same across the automotive sector, irrespective of the price point.
So, we looked instead at the brands who got luxury experiences spot on, in terms of marketing, environments, and creating a level of aspiration outside the luxury product itself – luxury fashion brands the likes of Prada, Luis Vuitton. We redesigned what were traditionally sales spaces – the motor shows, the showrooms – into storytelling spaces, and as a result, sales increased. By creating a more holistic representation of luxury, Bentley immerse their customers into the luxury story.
Creating Sense™
In today’s world, luxury is defined not by mere product specifications but by the powerful stories that brands tell. Provenance has historically played a crucial role in establishing luxury value, but the levers for powerful storytelling in the luxury space is changing. New segments care more about originality than origin, more about innovation than heritage. Crafting compelling narratives that resonate with the emotional drivers of these new consumers is key. As the rise of social media has democratized luxury consumption, powerful storytelling becomes even more important, allowing brands to cut through the saturated channels of social media, and win with emerging luxury customers. Successful luxury brands create holistic experiences, extending the perception of luxury beyond the product itself to immerse customers in the luxury universe.
At SDA, we support organisations big and small by creating sense™ through their brand. If you want to know more about how we can help you define a compelling and unique luxury story, get in touch.
