The Pandemic Has Proven That Luxury Isn’t About Products—It’s About Connection

The Pandemic Has Proven That Luxury Isn’t About Products—It’s About Connection

Shoppers who once scrolled to the nearest “it” handbag on Instagram are now spending time scouring Amazon for hand sanitizer. In a year when the focus abruptly shifted from what is wanted to what is essential, luxury brands are looking for a new way forward.

It’s not an easy task: Consumers are spending less in a global pandemic and economic uncertainty, according to data from PayPal and Vogue Business. Luxury sales, in particular, are down 21% as shoppers cut their spending and focus on practical items like cleansers, face masks, and sweatpants. Now high-end brands are rethinking how to talk to customers at a time when their products are undoubtedly less needed.

A number of luxury companies say the key to survival is building a trusted relationship with consumers and enhancing the digital shopping experience. For example, the luxury brand Cuyana (direct-to-consumer), the fashion label Cult Gaia and the leather goods retailer Senreve all stated that their DTC activities enabled them to survive the worst of the crisis.

Jasmin Larian, Founder and CEO of Cult Gaia noted that DTC channels keep brands moving when wholesale partners canceled orders amid the pandemic.

“Both brands and consumers have realized that the opulence is really over,” said Milton Pedraza, CEO of consulting firm Luxury Institute. Since luxury brands are most commonly associated with elements of life that have been disrupted by the pandemic – namely, travel and entertainment – this idea only makes sense.

To be aware of this shift, Cuyana, who normally focuses on womenswear and accessories, stopped product-oriented marketing entirely. According to founder and CEO Karla Gallardo, a temporary loss of revenue has paid off to strengthen the trust of his customers.

“We knew our customer had been through a lot,” she said. “What we could do as a brand in those moments was to support her and that would allow us to build a stronger relationship with her.”

Cuyana switched to lifestyle-oriented marketing designed for the current moment. It was “content with slow living and single-mindedness,” said Gallardo.

That kind of news, Pedraza said, is what a luxury brand is all about.

“This is an endorsement that the opulence of luxury is not as important as the relationship you have with this customer,” he said. “This human relationship in luxury is extremely important to increase sales.”

Luxury lessons from the pandemic

Rely on content

When the marketing product felt numb, Senreve turned to the content and rebooted the brand blog, sharing everything from cookie recipes to other brands the team had discovered. The idea, Chung said, was to “provide uplifting content that is inspirational, informative, interesting, and get you out of a crisis”.

Change your mindset

For a long time, luxury was purely a destination for many consumers, and that was part of its appeal. But now, according to Larian, brands need to think differently about what luxury means. “It is now a luxury for someone to be able to buy a silk dress from us at an affordable price,” she said.

Customize your lineup

When it became clear that Americans would not be living normally for a while, Cuyana worked with his factory partners to adjust the schedule for product release. “We have adapted our product calendar to meet the needs of the consumer during this time,” said Gallardo.

Wendy Wen, co-founder and COO at Senreve, said the company produced a limited amount of items based on demand and it had been difficult to keep products in stock during the pandemic as the factory was shut down. However, according to Wen, a close customer relationship helped Senreve overcome this setback.

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