The gap between Generation Y and Boomers is widening as Gen Y comes of age. Much has been written about what Gen Y really wants, including their ideals in the workplace. Likewise, Gen Y is providing leadership and demanding change in the luxury industry. While their parents have become accustomed to outstanding service and impeccable quality, Generation Y is socially minded and impact-oriented. Yes, all luxury should have a certain base level of quality. The question is, how important is social impact in driving purchasing decisions, even in luxury?
Sparxoo’s dynamic duo, Creo the Creative and Ana the Analyst, share their perspective. Creo believes the social mission will be king as a new generation of wealth emerges while Ana argues that purveyors of luxury should continue to focus on quality. We are in a transitional age where the balance between the gold standard of quality is countered by the demand of a younger generation to participate in meaningful community building.
Creo the Creative: The next evolution in luxury has to marry beauty with cause. Take Tiffany & Co. for example. Tiffany features images of coral reefs instead of using the precious material in their jewelry. The beautiful imagery in display windows speaks volumes of the high-end jewelers philosophy and dedication to the environment.
Ana the Analyst: Who do you think that display is for? Your college grad, aka Generation Y? No. It is for 49.6 year-old, to be precise. According to a TNS report, the average age of the emerging wealthy is 49.6 years of age. The head of millionaire households is typically age 58 and 45 percent are retired.
Creo: You’re thinking too near term, Ana. That 49.6 year old is not going to be a Boomer forever. In general, the cultural attitude towards excessive spending has soured amid this challenging economic climate. Purveyors of luxury are incorporating the green philosophy into their products and services to curb the negatively the affluent market has faced in recent time. When you buy green luxury, you’re not just buying high-end products, you’re buying impact. Right now, eco-sustainability is luxury sustainability.
Ana: Waxing poetic again, I see. Consider the brand identity of the top luxury retailers: 1) Nordstrom, 2) Neiman Marcus and 3) Brooks Brothers. That list was compiled according to a survey of professionals with an average net worth of $3.2 million. Of those respondents...
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