As the cost of living crisis continues, there is understandably a lot of nervousness around what this means for the individual and the potential long-term impact. We might expect to see UK consumers choosing to purchase value brands, but surprisingly, it’s resulted in people purchasing smaller luxuries as a treat. Due to this shift in mindset, now is the time for smart brands to focus on creating and marketing premium products.
Younger consumers are driving growth in luxury consumption, and these generations are set to become the largest buyers of luxury goods by 2030. A defining behaviour of Gen Z is that they enjoy showing success through the brands they purchase and interact with. To win over gen Z, there are four rules brands must follow. Here’s what we learned by working with scotch whisky business Chivas:
1. Build new expressions of desire
Premium brands can create desire in places where desire may not yet exist. Chivas had to evolve over time to fit with what luxury means to specific generations. It launched in a male-dominated world, so fed into this audience’s desires. However, as times have changed, Chivas has looked to modern luxury cues to evolve in unison with society and resonate with a new and exciting consumer.
2. Use values to prove value
Consumers want to align with brands that emphasise their own personal values. Chivas learned that gen Z sees success as a collective rather than just a solo pursuit. Based on this insight, Chivas launched its platform ‘I rise, we rise’ as a celebration of unconventional success and to celebrate those who helped people get where they are today.
3. Redefine to realign
Don’t be afraid to reimagine your brand with specific cues and ideals that speak directly to a new generation. They aren’t as familiar with traditional cues or rules, especially in the whisky market, so there is an opportunity to realign with this new demographic and understand their values. It’s OK to evolve as a brand – it’s what’s expected, so don’t be afraid of change.
4. Functional dominance
Prove your brand’s premium credentials through elevated functionality that can improve your audience’s daily lives. Chivas established that whisky didn’t need to be consumed in a traditional way: neat, with ice or with water. It was important to communicate simple and varied serves, allowing its brands to engage with consumers in an exciting new way.
It’s clear there is a demand for smaller luxuries despite the economic climate, so the focus needs to be on the positioning of the product. To achieve cut-through, brands must understand what premium products need to deliver for consumers. Carry out the research and start the journey towards embracing premiumisation.
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