【营销-奢侈品】unity-2018年奢侈品报告（英文）_市场营销_各行业最新市场研报_doc可编辑

LuxuryDaily®STATEOFLUXURY2018TheInsiderViewALuxuryMemoreportpollingouraudiencebroughttoyoubyLuxuryDailypublisherNapeanLLCinpartnershipwithUnityMarketing.©NapeanLLCandUnityMarketing|LuxuryDaily401BroadwaySte.1408NewYorkNY10013|mickey@napean.comSTATEOFLUXURY2018TheInsiderViewTableofContentsLinkstosectionsLetterfromMickeyAlamKhanEditorinChiefLuxuryDaily3LetterfromPamDanzigerPresidentUnityMarketing4ExecutiveOverview5LuxuryInsidersSurveyed7TakeAway7ACloserLookattheLuxuryGoodsServices/ExperienceMarketers8LuxuryGoodsCategories8LuxuryServicesExperiencesCategories9LuxuryMarketsCompetedIn10TakeAction10YearsinBusinessandCompetingintheLuxuryMarket10YearsLaunchedintheLuxuryMarket11TakeAction11SellingOvertheInternet12CompanyRevenuesGeneratedOnline12TakeAction12AdvertisingMarketingandInnovationStrategies14TrendsinMarketingandAdvertisingfor201814TakeAction14WhereLuxuryInsidersPlantoInvesttheirAdvertisingNextYear14TakeAction15BiggestChallengestoGrowthforLuxuryGoodsServices/ExperientialMarketers16TakeAction»16RespondingtoDisruption”17TakeAction17InnovationStrategies18TakeAction18KeyTrendsImpactingtheLuxuryMarket19TakeAction20TrendsPerspectivebyRolesPlayedinLuxuryMarket21LuxuryGoodsInsidersViewofTrends22TakeAction22LuxuryServices/ExperiencesViewofTrends22TakeAction22LuxuryIndustrySuppliersViewofTrends22TakeAction23TrendsShiftfrom2017to201823TakeAction24BusinessConditionsintheLuxuryIndustry26InsidersViewofBusinessConditions26TakeAction26BusinessConditionsinLuxuryMarketOverallLastYeartoThis27BusinessConditionsinLuxuryMarketOverallinNextTwelveMonths27TakeAction28BusinessConditionsinTheirCompaniesoverthePastTwelveMonths28BusinessConditionsinTheirOwnCompaniesinNextTwelveMonths29TakeAction29What2018HoldsfortheLuxuryMarket30ChallengesAheadfortheLuxuryBusinessin201831OpportunitiesAboundin201835WhattoWatchforinLuxuryin201838ForMoreInformationontheLuxuryMarket39LuxuryDaily39AboutPamelaN.DanzigerPresidentUnityMarketing39IntroductionAfeelingofoptimismabouttheluxuryindustrysprospectsfor2018isstartingtopervadetheindustry.InthisLuxuryDailyandUnityMarketingssecondannualsurveyamongluxuryindustryinsidersincludingbothexecutivesthatmanagethecompaniesthatprovideluxurygoodsandserviceexperiencestoluxuryconsumersandthebusinessesthatprovidesupportservicestotheluxuryindustrynearlyhalfofthosesurveyed47%]believethatconditionsintheluxurymarketingeneralwillimprovein2018andmorethantwo-thirdsfeelconditionsfortheirowncompanieswillgainaswell.Bothmeasuresaremarkedlybetterthaninthesurveyconductedlastyear.AndthissurveywastakenthroughAugustandSeptember2017beforetheBainCompanyannualglobalstudyreportthatpredictedworldwideluxurygoodsindustrygrowthtogrow5%thisyear.Whilethisisnewsthatwouldcastapositiveglowindustrywideithadnoimpactontheluxuryinsidersperspectivewesurveyed.ButasthesayinggoesHopeisnotastrategy/1andtherestillisplentyofworkthatneedstobedonefortheluxuryindustrytoturntheseoptimisticfeelingsintomeasurableresultsandgrowthfortheirbrands.ThedigitalrevolutioncontinuestodisruptbusinessasusualinretailingeneralluxuryinparticularthoughthisyearthesurveyshowsmoreluxurycompanieshaveembracedthepotentialthatInternetmarketingandecommercerepresentbyit.Innovationbothinproductandservicesofferingsoffersapathforgrowthinthefutureformanyplayersaswell.Thoughinnovationstrategiesjustasoftenfailtocatchonandrealizetheirpromiseassucceed.AndpoliticalturmoilthemostdisruptivetrendidentifiedinlastyearssurveyandwhichweexpectedtoberesolvedaftertheU.S.Presidentialelectioncontinuesunabatedifnotacceleratedacrosstheculture.Itremainsthemostnegativetrendimpactingtheluxurymarkettoday.Inthereportthatfollowsyouwillseetheresultofthisyearssurveyamong600luxuryindustryinsiderscomparedwiththosefromlastyear.Wewillreportonthetrendsyear-to-yearandprovideactionabletakeawaysbasedontheresultstohelpyoupoweryourcompetitiveandmarketingstrategiesfor2018andbeyond.FromourperspectiveasobserversandanalystsoftheluxuryindustryatlargeandtheluxuryconsumersthatarevitalmembersoftheluxurycommunityLuxuryDailytheworldsleadingluxurybusinesspublicationandUnityMarketingamarketresearchfirmspecializingintheluxurymarketandaffluentconsumersegmentarepleasedtobringyouthisreport.FromAug.1throughSept.312017wesurveyed600executivesfromtheLuxuryDailysubscriberlistandtheUnityMarketingdatabase.Thesurveywasconductedduringthesametimeperiodandamongthesamenumberofrespondentsaslastyearmakingtheresultscomparable.Theresultsoftheonlinesurveygiveusabirds-eyeviewofthecurrentluxurybusinessitschallengesandopportunitiesandwhereitisheadedinthefuture.Throughoutthisreportwewilltrytodrawconclusionsaboutwhattheresearchfindingsmeandependingonthevantagepointofthoseinthebusinesswhethercompetitorsintheluxurymarketorcompaniessupportingtheeffortsofthosecompanies.Inthiswaywewillattempttomaketheresearchdataactionableforyou.MickeyAlamKhanEditorinChiefLuxuryDailymickey@napean.comLetterfromPamDanzigerPresidentUnityMarketingInmybusinessasaluxuryindustryinsiderservingluxurymarketersandbrandsIstarteachdayreadingLuxuryDailylikethousandsofothers.Itkeepsmeupwithnewsandtrendsintheluxurymarket.ButinmyprofessionasamarketresearcherIknowthattheinformationisanecdotalscatteredandunstructuredmakingitdifficulttotakethatdailysnapshotofstoriesandcompileitintoacomprehensiveandauthoritativepictureofthekeytrendsimpactingtheluxurymarket.AformalresearchstudyiswhatisneededwhichiswhatMickeyandIsetouttodowiththissecondannualsurveyamongpeopleworkingintheluxuryindustry.Ourgoalistodocumentthemostsignificanttrendsshapingthefutureoftheluxuryindustryinwhichwealloperate.Wepolledmorethan600industryinsiderstomeasurethechallengesandopportunitiesfacingcompaniesinthisspaceandcomparedtheresultswiththosefromlastyearssurvey.Wethankallthoseinsidersforsharingsogenerouslytheirthoughtsandfeelingabouttheluxuryindustryandtheirroleinthemarket.Whatwediscoveredinthisstudyisanindustryundergoingprofoundchangeswiththedigitalrevolutionbeingbothitsprimarydisrupterbutalsoitspotentialsaviorintheyearsahead.Wehaveidentifiedsevenkeytrendsshapingtheindustrysfuturewithperhapsthemostimportantofwhichbeingtheverydefinitionofluxuryisshiftinginthemindsandlifestylesofthecustomersweserveeitherdirectlyintheproductsandservicesonofferorindirectlyasmarketersprovidingsupportservicestothosecompanies.Thisshiftcallsonthoseintheindustrytoadjusttheirdefinitionofluxuryaswell.Wefoundthatinsidersviewthepastyearasachallengingonefortheirbusinessesastheydidlastyear.Butimprovementsarealsobeingfeltoverallandtheinsiderssurveybelievetheircompanieshavestrategiestorespondtotheshiftsinthemarketthatwillenablethemtoovercometheheadwindstheyhavefaced.Theinsidershaveambitiousgoalsfornextyearandexpecttodobetteroverthenexttwelvemonths.Onenotablefindinginthisstudyisthatluxuryindustryinsidersidentifyavitalneedforbetter-trainedandexperiencedprofessionalstofillkeyrolesintheircompaniesresultingfromthemanychangeschallengesandopportunitiesblossomingintheluxuryindustry.Thissuggeststhatprofessionalswitheducationandexperienceintheindustrymayfindnewemploymentopportunitiesoverthecomingyear.Companiesoperatingintheluxuryindustrytheveryfoundationofwhichistoprovidethebestandmostexquisitethingsandexperiencestothemostdiscerningandpowerfulconsumersfirstandforemostneedthebestandbrightestpersonnel—theindustryshumancapital—toprosper.Weproudlysharethisimportantindustrystudywithyou.GoodLuxe/PamelaN.DanzigerPresidentUnityMarketingExecutiveOverviewThisluxuryindustryinsiderssurveytakesthemeasureof600participantsintheluxuryindustry.Itincludesperspectivesfromluxurygoodsmarketerswhichrepresentthelargestshareofinsiderssurveyed41%%luxuryserviceandexperiencemarketers16%]andsuppliersofservicessuchasadvertisingmediaconsultingandotherstoluxurygoodsandexperientialmarketers28%.Thisyearssurveysamplewasenhancedbygreaterparticipationofinsidersworkinginthehomeluxurygoodsandservicessectors.Hereisasnapshotofthekeyfindingsfromthisstudy:AbouttheLuxuryIndustryCompaniesSurveyedThisyearsluxuryinsiders*surveywasenhancedwiththeadditionofmorehomegoodsmarketerstogatheranevenwiderperspectiveontheluxuryindustryacrossalltheconsumerslifestyleinterests.Insidersparticipatinginhomefurnishingsapplianceslinensandtabletopwerethemosthighlyrepresentedsampleinthestudyjoiningjewelryclothingandfashionaccessorieswatchesartbeautyfoodwineandspiritsandautomobilestosharetheirperspectivesoftheopportunitiesandchallengesintheluxurymarketin2018andbeyond.Ontheluxuryserviceandexperiencessideinsidersofferingservicestohomeownersincludingrealestateinteriordesignersarchitectsandbuildersaddedperspectivetooalongwithhospitalitydiningandrestaurantstravelserviceretailersfinancialservicesandbeautyservices.Thevastmajorityofluxurygoodsandservicesmarketersoperateinaglobalspherethoughthepredominantshareofthesecompanies85%viewtheUnitedStatesandCanadaastheirkeyluxuryconsumermarketwithWesternEurope37%andUnitedKingdom32%]beingthenextmostimportantmarkets.Theluxurygoodsandservicesmarketersworkforcompaniesthathavebeenactiveintheluxurymarketanaverageof30yearswithmosthavingbeeninbusinessnearlyadecadebeforesettingtheirsightsontheluxurybusiness.Some40%ofthesecompaniesbecameactiveintheluxuryindustrysincethenewmillenniumand80%since

1980.RegardingtheInternetnearly40%oftheluxurygoodsandservicemarketerscurrentlyarenotsellingovertheInternetthough68%ofluxurygoodscompaniesareecommerceenabled.Amongthosecompaniesthatsellgoodsandservicesonlinenearlyone-thirdofcorporaterevenuesareattributedtoonlinesales.AdvertisingMarketingandInnovationStrategiesIn2018amajority58%ofluxurygoodsandexperiencemarketersplantospendmoreonadvertisingwithsocialmediaWebsiteenhancementsandinternetadvertisinggettingthebiggestboostinadvertisinginvestments.Thebiggestchallengestogrowthfortheluxurygoodsandservicemarketerssurveyedarehowtofindnewcustomersfortheirbrandsintenseandgrowingcompetitioningeneralaswellaspricecompetition.Thecostofdoingbusinessintodaysluxurymarkettooholdsbackcompaniesfromgrowth.Howeverluxurygoodsandservicesmarketersarelesschallengedthisyearascomparedtolastwithsellingtocustomerswhoarenotwillingtotradeuptoluxurywhichisanetpositivechangeforinsidersthisyear.OverallluxurygoodsandserviceinsidersviewtheInternetandsocialmediaasthemagicbulletin2018toreachnewcustomersbuildimpressionsandmakeconnections.Topowerinnovationstrategiestheyturntothenewsandindustrytradesourcestofollowtrendsandengageinactivelisteningandsocialmediamonitoringtohearwhattheircustomersaresayingandunderstandwhattheyarefeeling.Formalmarketresearchstudiesandactivelisteningtotheirownstaffsarefarlessimportantoverallbutahugemissedopportunity.•KeyTrendsImpactingtheLuxuryMarketThreetrendsemergedasthemostpositiveforthegrowthofluxuryinsidersbusinesses.Theyareproductandserviceinnovationsocialmediaandriseofthedigitalworldandproduct/servicediversification.Ontheotherhandthemostnegativetrendsimpactingtheirbusinessesinthecurrentmarketispoliticalinstabilityanddivisivenessfollowedbymonetarypoliciesandthechallengeoffindingandretainingqualifiedemployees.•BusinessConditionsintheLuxuryIndustryTheoverallperspectiveaboutbusinessconditionsintheluxurymarketthisyearshowsignificantimprovementfromlastyear.Nearlyhalf47%ofinsiderssurveyedbelievetheluxurymarketingeneralwillimprovein2018ascomparedwith

2017.Asfortheirowncompaniesovertwo-thirdsexpectbusinessconditionstoimprovethisyearwhichagainisanimprovementoverlastyear.•DeepDiveintoSevenKeyTrendsShapingtheFutureoftheLuxuryMarketAreIdentifiedThesurveyincludedanumberofopen-endquestionsallowingtheluxuryinsiderstosharetheirattitudesbeliefsandfeelingaboutprospectsfortheluxurymarketincludingthespecialchallengesandopportunitiestheyseefortheindustryandthecompaniesinwhichtheywork.TheluxuryinsiderssurveyedseethesesevenkeytrendsasmostprofoundlyshapingtheindustrysandtheirCompetitionfrommid-marketandpremiumgoodsFloodedmarketEmerging21stCcompaniesFailureofluxuryheritageandtraditionSocialTurmoilPoliticalclimateCulturaldivisivenessItsuncertaintiesonsteroidsGlobalizationInterconnectedworldeconomyNewculturesnewculturalinfluencesDifferentlifestylesThreatofterrorismBrexitmonetarypoliciesDemandforInnovationIsmanagementandstaffupforchangePressingneedtodiversifyTacticalfocuslackingstrategicfocusNeedforcreativedestructionReadonfordetailsaboutthesefindingswithcalloutsofwhatthefindingsmeanforcompaniesthatservetheluxurymarketandindustry.LuxuryInsidersSurveyedInall599luxuryindustryinsiderscompletedtheonlinesurveywhichisvirtuallythesameasthe603whodidsolastyear.Thesurveyincludesindustryparticipantsrepresentingfourkeysectors:Luxurygoodsmarketersand/orretailers:Justunderhalfofthosecompletingthesurveycompeteintheluxurygoodssector.Luxuryservices/experiencesmarketers:Some16%ofrespondentsparticipateindeliveringluxuryservicesand/orexperiencesincludinghome-relatedtravelfinancialservicesrealestateandothers.Suppliersofgoodsandservicestoluxurymarketers:Thisisoursecondlargestrespondentsegmentwithjustoverone-fourthofoursamplesupportingluxurygoodsandexperiencecompaniesincludinginsidersfromadvertisingbrandingandmediaagenciesconsultantsmanufacturingpartnersresearchersetcetera.•Publishersreportersandeducators:Theseobserversoftheluxurymarketwerebrokenoutseparatelythisyearandrepresentedfewerthan10%ofthesurveysample.TAKEAWAYDifferentperspectivesemergedependingupontherolesplayedintheluxuryindustrysothroughoutthisreportwewillinterpretthefindingsfromthosedifferentvantagepoints.8up9fjEi^KiiufipuejqqUEsdEN5M3!AJ9PISU1am81OZAMflXmdO31V1S8959diuoDs」3W」eiuspooSXjnxn]ipgMuisauoS3；e3:zajnSijA|ddeieqi7le£U|a;adiuo3no人oq1-gWspooAjnxnqaqijosauoSa^D】WMueoXsiq4P9J9AO99JESpSSU20S9J!]rSJ9lUnSU0DXjnxnfjo0§uejjoieojSeSBAVpadsjmdrsjaia|JBiusSuiqsiujnjaiuoqsjolujouopippeq!M•sja^a^jeujuoiqsejpueXjpMafXqpoMoyoj0uedQn」edjoojeqs4S0§jbioippa^uasajdajsSuiqsiujnjaiuoqrspoo§/Cinxrqujsauo§aiE3spooXanxnq•sassauisnqJiaq^04XnEDLjpads§uiuiE4J0dsuopsanbEuopippepaSEajSMsj冲甲eiuaoua-uadxa/aoiAJsspuespoo§Xjnxn|aqiS93U9Uadxg/S93lAJ9SqspoogXinxnqoq*007jssoqvM5Ajapisuiaqi8T0ZABflXmHO31V1SLuxuryServicesExperiencesCategoriesAmongluxuryservicesandexperiencesmarketershomeservicesproviderssuchasinteriordesignersarchitectsandbuildersareaddedtoresultsfromhospitalityrealestatetraveldiningretailfinancialandbeautyservicetoagaingiveabroaderperspectiveonthemarketforluxuryexperiences.LuxuryMarketsCompetedInAmongluxurygoodsandservicesmarketerstheUnitedStatesandCanadaaccountforthelionsshareoftheirbusinessfocusfollowedbyWesternEuropeUnitedKingdomChinaandtheMiddleEast.Overalltheinsiderssurveyedcompeteinanaverageof

3.7marketsthesameaslastyear.ThissurveywhileconductedinEnglishbytwoU.S.-basedfirmstapsperspectivesofplayersintherapidlyexpandingglobalforluxury.Globalizationisakeytrendidentifiedbythesurveyrespondentsrepresentingbothopportunitiesforgrowthandexpansionaswellaschallengesintermsofadaptingmarketingandbrandingmessagesandmediumsandretailingstrategiestoconsumersinlocalcultures.YearsinBusinessandCompetingintheLuxuryMarketLuxurygoodsandservicesmarketershavebeeninbusiness36yearsonaveragewiththelargestshareinbusinessfrom26-50years.Bycontrasttheircompanieshavebeencompetingintheluxurymarketfor30yearsonaveragesotheyenteredtheluxurymarketaboutsixyearsafterfounding.Thisisapatternofdelayedentryintotheluxurymarketthatwefoundlastyear.YearsLaunchedintheLuxuryMarketThemajority53%ofluxurygoodsandservicesmarketersstartedintheluxurymarketsince2000withnearly80%enteringtheluxuryarenasince

1980.Whilemanyheritageluxurybrandshaveahistoryextendingbackahundredyearsormoretodaysluxuryindustryiscomposedprimarilyofnewercompaniesjustbeginningtogettheirluxuryon.Withamajorityofindustryrespondentsonlyenteringtheluxurymarketsincethenewmillenniumthisstudyisskewedtowardrecententrantsintheluxurymarkethavingahistoryoflessthan50yearsinthebusinessofluxury.Presumablywithlessheritageandtraditiontofallbackonthesenewerluxurycompaniesarebetterpositionedtoadapttotherecentchangesaffectingtheconsumermarket.Furthermanycameofagealongwiththedigitalrevolutionsincethemillennium.SellingOvertheInternetThemajorityofluxurygoodsandexperiencesmarketerscurrentlysellovertheInternetwithluxurygoodsmarketers68%moreactivesellingovertheInternetthanluxuryservicemarketers45%.NotablythepercentageofluxurygoodsmarketersthatsellsovertheInternetrosefrom62%in2016to68%in

2017.Butthatleavesaboutone-thirdofluxurygoodsmarketersnotyetsellingtheirproductsviaecommerce.Furtheragreaternumberofservicemarketers28%havenoplanstosellovertheInternetascomparedwithluxurygoodsmarketersonly13%ofwhichhavenoplanstosellontheInternet.CompanyRevenuesGeneratedOnlineWhilemoreluxurygoodscompaniesinparticulararesellingtheirproductsovertheInternetecommercedirect-to-consumersalesdonotcontributesignificantlytooverallsales.Some42%ofluxuryinsiderssurveyreportthatonly10%orlessofrevenuescomeviatheInternet.TheaveragepercentageofrevenuescomingviaInternetsalesis34%overallsameaslastyear.TAKEACTIONTheFall2017BainLuxuryStudyreportedthatapproximately9%ofglobalpersonalluxurygoodssaleswillbegeneratedviaonlinechannelsincludingbothabrandsdedicatedWebsitesande-tailersofferingaplatformformulti-brandengagement.ButwhileonlinesalesremainsfairlylowBainpredictsthatitsoverallshareoftheluxurypersonalgoodsmarketwillgrowto25%by

2025.“Channelsarenowcomingtogetherinaninterdependentandintegratedecosystemaroundthecustomer/writesClaudiaDArpizioaBainpartnerandleadauthorofthestudy.Thiscallsonmarketerstodefinetheirchannelsofdistributionnothowthecompanywantstomanageoperationsbutratherbaseituponhowthecustomerswanttoengagewithbrands.IntheevolvingomnichannelecosystemforluxurybrandsBaincallsoutthecomplementaryrolesofretailandwholesaletheneedtoleverageonlineasasupportplatformforallphysicalchannelstravel/airportandoff-priceretailasameanstowidenthecustomerbasewithlessintimidatingwaystoexploreluxurybrandsandthevitalneedfore-commerceengagement.With20000luxurymono-brandedstoresworldwidebrandsmustmanagetheomnichannelnetworkfromhumantouchpointstodigitalengagement.Brandsthathavebeenslowtoembraceallthatdigitalinteractionofferscustomersincludingthepurchaseoptionmustseethatacomplete360-degreedigitalplatformisthetippingpointtorelevancewithmillennials.Thissuggeststhatbyignoringthesalespotentialandcustomerreachavailableonlinethatasizeablenumberofluxurybrandsareleavingseriousmoneyonthetable.JWTIntelligencesworldwidedirectorLucieGreeneiswidelyquotedassaying“EcommercehasbeendescribedasthenextChinaforluxuryintermsofopportunity.1AdvertisingMarketingandInnovationStrategiesOnlyluxurygoodsandservice/experienceinsiderswereaskedthisseriesofquestionsabouttheiradvertisingexpectationsandtheiradvertisingmarketingandinnovationstrategies.TrendsinMarketingandAdvertisingfor2018Prospectsarebrightforgrowthinadvertisingandmarketingspendingin

2018.Thissurveyfoundasubstantialmajority58%ofluxuryinsidersexpectingtoinvestmoreonadvertisingoverthenext12months.Thisisalsoanotableimprovementfromlastyear.Alsosignificantisthatbothluxurygoodsandservices/experiencemarketersreportvirtuallyidenticalpercentagesthatwillincreasespendingnextyear.Figure10:Advertisingandmarketingspendingtrendsin2018Whileinvestingmoreonadvertisingandmarketingdoesnotnecessarilytranslateintomoresalesandinfluenceonthetargetluxuryconsumersitisabellwetherofstrengthintheindustryoverall.Thefactthatamajorityofluxuryindustryinsiderswillinvestmoreinthisareainthecomingyearisapositiveindicatorthattheycontinuetofocusonfindingnewcustomersattractingthemtotheirbrandsandgrowsales.WhereLuxuryInsidersPlantoInvesttheirAdvertisingNextYearWhenaskedhowtheluxurygoodsandservicesmarketerswillbeallocatingtheiradvertisingspendingin2018thegreatestpercentagenearly80%saidthatsocialmediapromotionswillbeintheirplanswithtwo-thirdsalsoplanningwebsiteenhancements.Internetadvertisingfollowedbyinfluencerandcontentmarketingandvideosarealsowidelyplanned.Notablyonlyabout40%willallocateadvertisinginprintpublications.10luxurybrandssavedsome$33millioninadvertisingexpendituresbyshiftingfromprinttodigitalinMarch2017a33%increaseoverlastyear.OverallthestronggrowthoftheUSdigitaladmarketcanlargelybeattributedtoincreasedtimespentbyconsumersondigitalmediaandbrandsincreasedcomfortwithallocatingbudgetstodigitalformatsparticularlyondigitalvideo.Inarecent2016surveyofalmost400U.S.adagenciesandmarketerstheIABfoundthattwo-thirdsofrespondentsplanonincreasingspendingondigitalvideointhenextyear.Furthermobilewillbecomeanincreasinglyimportantadvertisingplatformasconsumersdevotemoreoftheirviewingoncellphonesandtablets.TodaythereremainsagapinsupportofmobiledistributioncallthemobileopportunitygapbyBusinessInsider.Theypredictthatthisgapwillclosein2018whenmobilewilleclipsedesktopadspend.BIreportsDigitalvideoadvertisingwillgrowfasterthananyothersegmentoverthenextfiveyearsasconsumersshifttimespentonlinetophonesandtablets.Revenueinthiscategoryisforecasttorisefrom$

8.5billionin2016to$23billionin2021/BiggestChallengestoGrowthforLuxuryGoodsServices/ExperientialMarketersFindingnewcustomersfortheirluxurygoodsandservice/experienceisluxurymarketersbiggestchallengetogrowth.Thisisfollowedbythecompetitioningeneralaswellaspricecompetitionwithpricecompetitiongrowingstrongerthisyearthanlast.Giventherecentemergenceofsomanybrandstryingtogainafootholdintheluxurymarketincludingcompetitionfromlower-pricedbrandsaimingforhigh-endcustomersthisclearlyisagrowingconcern.Therisingcostsofdoingbusinessfollowsasagrowthchallengeasittakesasignificantinvestmentinmarketingtofindnewcustomerswillingtospendandtodefeattheemergingcompetition.ThisisconfoundedbythechallengesofchangingdistributionchannelsmostespeciallyInternetdisruption.Changingcustomertastesalongwithchallengesofthoselesswillingtotradeuptoluxuryofferingsalsoinhibitgrowththoughnotablyfewerthisyearfacethechallengeofcustomerslesswillingtospendthandidlastyear.WhatAreYourCompanysBiggestChallengestoGrowthintheLuxuryMarketcheckallthatapply0%10%20%30%40%50%TAKEACTIONWhilefindingnewcustomersistheluxurymarketerschiefchallengetogrowthdevelopingstrategiestofurtherengageandretainonescurrentcustomersisultimatelythemostprofitableandmosteffectivewaytogrow.StudyafterstudyhasfoundthatthecostFindingnewcustomersCompetitionCostsofDoingBusinessCustomerslesswillingtospendChangingcustomertastesInternetdisruptionChangingchannelsofdistributionChangingcustomerbaseChangingdemographicsRetainingexistingcustomers/brandloyaltyLuxuryhaslostitsmeaningInnovation49%50%35%30%Pricecompetition|31%■■■■■■■■■■34%25%24%26%26%24%24%24%25%■21%20%AdvertisingislesseffectiveGlobalization|19%20182017Figure12:Luxurygoodsandservicesmarketerschallengestogrowthofacquiringanewcustomerismanytimesmorethankeepinganddevelopingexistingcustomerswithmoststudiesfindingcustomeracquisitioncostsfourto10timesmore:•ABainCompanystudyfoundamere5%increaseincustomerretentioncanincreaseacompanysprofitabilityby75%.FurtherBainresearchfoundthattheaverageamountspentbyarepeatcustomerwastwo-thirdsmorethananewcustomer.•TheGartnerGroupreportsthat65%ofacompanysbusinesscomesfromexistingcustomers.•AndinaseminalarticleonthevalueofcustomerretentionconsultantsP.M.DawkinsandF.F.Reichheldreportedthata5%increaseincustomerretentiongeneratedanincreaseincustomernetpresentvalueofbetween25%and95%acrossawiderangeofindustries.CustomerRetentionasaCompetitiveWeapon；DirectorsandBoards1990Allthisaddsuptothecriticalimportanceofcustomerretentionanddevelopmentnotattheexpenseofnewcustomeracquisitionstrategiesbutasapartofacompanysoverallmarketingstrategy.WithagoalofacquiringnewcustomersUnityMarketinghasidentifiedakeyopportunityforluxurymarketers:BuildconnectionwithyoungHENRYshigh-earners-not-rich-yetontheroadtoaffluence.YoungHENRYsrepresentthebestpotentialluxurycustomersofthefuture.Thatisbecausemostultra-affluentsthetop2-3%ofhigh-incomecustomersandthetraditionaltargetforluxurybrandsstartontheirroadtoaffluenceasHENRYs.AmbitiousaspiringyoungHENRYsontheroadtoultra-affluencearethekeytothenextgenerationcustomersforluxurybrands.RespondingtoDisruptionMostifnotallindustrysectorsarefacingthechallengesofdisruption.Soweaskedluxurygoodsandservice/experiencemarketersaboutthereporteddisruptionintheluxurymarket.Inresponsethegreatestshare49%saidthatinvestingmoreinsocialmediaandonlineInternetstrategies46%wastheiranswer.MoreadvertisingmoreinnovationexpandeddistributionstrategiesandexplorationofmobilearealsogettingattentiontoanswerdisruptionseffectTAKEACTIONTheluxuryindustryisfacingthedisruptiveeffectofchangesintheluxuryconsumermarketduetochangingdemographicsofthecustomerweservetheirshiftingexpectationinproductsandservicesandtheirnewchosenwaystoshopbuyandengagewithbrands.Thisultimatelyrequiresreinventionofthetraditionalwayofdoingthingstogettheindustryandluxurybrandsbackingrowthmode.Andifluxurybrandsdontdothisthemselvesthereareplentyofnewcompanieswaitinginthewingstomoveontotheluxurystage.Wheneverpeoplesaytheworddisruptiontheyusuallymeantheactionsofdisrupters.ThatisnewageInternet-poweredbrandsaredisruptingthestatusquo.Inotherwordsthemarketdisruptioniscausedbythedisruptersorasthisinsidersaid“Amazonandthecommoditizationofeverything.Butitisnotthatsimple.WhatEffortsDoesYourCompanyMaketoInnovateintheLuxuryMarketTodaycheckallthatapplythatoffernewsolutionstooldproblems.Becausetheyarenotentrenchedintheoldwayofdoingthingsandhamperedbyestablishedconventionalwisdomtheyareabletolookatthemarketinnewwaysandcomeupwithcreativeinnovativesolutionsthattheestablishedmarketersmissed.Whatsdisruptingthebusinessoftraditionalluxurybrandsisthattheirverytraditionandheritageisgivingwaytoademandfromcustomersforgreaterrelevancyinthewaytheylivetodayandaspiretolivetomorrow.Thatisthelaunchpadformanynew-ageluxurybrandsandthepotentialgraveyardfortheestablishment.Luxurybrandsmustrespondtocustomerslookingfornewluxeexperiencesdeliveredinnewways.Thiswillrequiredramaticshiftsinmanagementmarketingbrandingadvertisinganddistributionstrategies.InnovationStrategiesTostayaheadofthecurvethegreatestnumberofindustryinsiders65%persistentlyscanthenewsfordevelopmentsandnewideas.Theyalsogatherinputfromcustomersthroughactivelistening062%andmonitoringsocialmedia57%thoughfarfewerlistentocompanystaff37%orconductformalmarketresearch35%todriveinnovation.TAKEACTIONTheluxuryindustryinsiderssurveyedhaveambitiousexpectationsforgrowthinthecomingyear.ToachievethosebusinessgoalsmarketingandadvertisingstrategieswillplayapivotalroleasPeterDruckerfamouslywroteinhisclassic1954bookThePracticeofManagement:Becausethepurposeofbusinessistocreateacustomerthebusinessenterprisehastwo一andonlytzvo一basicfunctions:marketingandinnovation.Marketingandinnovationproduceresults;alltherestarecosts.Marketingisthedistinguishinguniquefunctionofthebusiness.Forthosebusinesseshopingtoreapsomeoftheextradollarsluxuryindustryplayerswillinvestinmarketingandadvertisingin2017itwillbeespeciallyimportanttodelivermeaningfulandmeasurableresults.Asthissurveyhasshownmanagingcostsintoda/srapidlyshiftingluxurymarketisacriticalpriorityforluxurygoodsandservicescompanies.Theydemandresultsforthemoneyinvestedinmarketingandadvertising.Sothecalltodayisnotnecessarilyformoreadvertisingandmarketingbutformoreeffectiveadvertisingandmarketingwitheffectivenessmeasuredinnewcustomersandgrowingsalesnotjustmoreclicksorsharesorengagement.Luxurygoodsandservicescompaniesneedsalesandprofitstogrow.Thatmeansbudgetsallocatedtoadvertisingandmarketingneedtodeliverreturnstoboththetopandbottomlineofluxurybusinessesbalancesheets.KeyTrendsImpactingtheLuxuryMarketThissectionexaminestheviewsofallindustryinsiders-luxurygoodsservices/experiencesandsuppliersofservicestotheluxuryindustry-onthemostimportanttrendsimpactingtheluxurymarket.Inthesurveyluxuryindustryinsiderswereaskedtorateeachof16trendspresentedastowhetheritwaspositivelyornegativelyimpactinggrowthfortheircompanyusingafive-pointscalefrommostlynegativesomewhatnegativeneutralsomewhatpositiveandmostlypositive.Toaidinanalysisanindexwascreatedwhere100equalstheaverageorneutralwithvaluesover100viewedasmorepositiveandthoseunder100viewedasmorenegativetotheirowncompanysgrowth.Themostpositivetrendspropellingluxuryinsiderscompanygrowthare:Innovationinproductandserviceofferingwithanindexvalueof115whichmeansthistrendis15%morepositivethanaverage.Socialmediaandtheriseofthedigitalworldbothrated113or13%morepositivethanaverage.Diversificationinproductandserviceofferingsrated

112.Findingnewpathstomarketrated111Globalization

107.Changesinwealthdistribution

103.Ontheotherhandluxuryinsidersviewthecurrentinstabilityinpoliticsandthecultureassupplyingthemostnegativeheadwindstoluxurygrowthfollowedbymonetarypoliciesandeconomictrendsandfindingandretainingwell-qualifiedemployees.IndextoTrendsImpactingGrowthin2018100=Averagetrends100aremorepositive100morenegative65ProductorserviceinnovationSocialmedaRiseofthedigitalworldDiversifyingproduct/serviceofferingsFindingnewpathstomarketGlobalizationChangesinwealthdistributionChangesinluxuryconsumers1mediahabitsChangesinconsumerdemographicsi.e.maturingbabyboomersriseofmillennialMergersandacquisitionsChangesinhowluxuryconsumersshopChangesinhowconsumersdefineluxuryChangesinhowluxuryconsumersspendFindingandretainingwell-qualifiedemployeesMonetarypolicyandeconomictrendsPoliticalinstability7075859599Figure15:IndextotrendsimpactinggrowthforluxuryinsiderscompaniesTAKEACTIONDependingonthetrendmarketershavemoreorlesscontroloverhoweachaffectstheircompanysgrowth.Forexamplethetrendswhichtheyhavelittleornocontroloverincludemanyofthemostnegativelyimpactingtrendsaswellasmanychangesinthemakeupoftheconsumermarket:LittleornocontrolPoliticalinstabilityMonetarypoliciesandeconomictrendsChangesinwealthdistributionChangesinconsumerdemographicsSomecontrolSometrendsmarketerscanexertsomeinfluenceon.Marketerscangreatlyincreasethepositiveimpactofeachofthesetrendsontheirowncompanysgrowththroughresearchtoidentifytheshiftsinthemarketplacearoundthem:Changesinhowconsumersdefineluxury.Thoughbrandscannotcontrolthemindsetofluxuryconsumersandhowtheypartakeofluxuryintheirlifestylescompaniescanevolvethewaytheypresentandpositiontheirbrandofluxuryinaccordancewithhowtheconsumersdefinitionsarechanging.Changesinluxuryconsumersmediahabits.Anothertrendthatcompanieshavelimitedeffectoverbutthroughresearchtheycanmakesuretheyarealignedandpositionedtotakeadvantageoftheshiftsinconsumersmediapreferences.Changesinhowluxuryconsumersshopandspend.Beingproactiveratherthanreactiveiskeytorespondingtochangesinluxuryconsumersshoppingandspendingbehavior.Marketresearchisneededtopowertheseefforts.Findingandretainingqualifiedemployees.Thistrendisgenerallyviewedasnegativelyimpactingthegrowthforluxurymarketers.Attractingthebestandbrightesttalenttothecompanyiskeysosupportingandworkingwiththegrowingbodyofadvancededucationalinstitutionstrainingthenextgenerationofluxuryleadersisonewaytomakeconnectionswithprospectiveemployees.Andoncethosequalifiedstaffareonboardmaintaininggoodemployeerelationshipsandgivingstaffpathstogrowanddevelopintheircareersisalsokey.Mergersandacquisitions.Luxuryinsidersviewthistrendmorenegatively.Butthekeyiswhetheronescompanyisbeingacquiredordoingtheacquisition.Bothbringmanychangestoacorporateculturethoughacquiringcompaniestendtohavemorecontroltomanagethechanges.LargelyUnderCompanyControlFinallycompaniescanexertmuchcontrolofmanyofthemorepositivetrendsfromtheluxuryinsidersperspectivewiththeireffectivenessmeasuredbyhowwelltheyrespondtoeach:Productandserviceinnovation.Luxurycompaniesmustmaintainaninnovationmindsetandalwaysbelookingforwaystobringpositivechangetotheiroperationsthatmeetevolvingneedsofthecustomers.Socialmedia.Thisisthemostpositivetrendfavoringgrowthaccordingtotheinsiderssurveyed.Buthowtomeasuretruesuccessinsocialmediaisstillnotwelldefined.IsitnumberofclicksnumberoffriendsorextentofreachorisitmeasuredinsalesgeneratedthroughsocialmediaactivityorothermetricThishasbeenatopiccoveredwidelybyLuxuryDaily.http://bit.ly/2zGnLmJ.Riseofthedigitalworld.Anothermostlypositivetrendforluxurycompanygrowthbutonewhichsomeone-thirdofluxurygoodscompaniessurveyedherehaveforsakenatleastasasourceforInternetsales.Globalization.Withtheluxurygoodsandservicescompaniessurveyedactiveinnearlyfourglobalmarketsonaveragetheyarealreadytakingadvantageofthistrendandarelikelytocontinuetoexpandgloballyinthefuture.Diversifi/ingproduct/serviceofferings.Diversificationisseenasalargelypositivetrendonethatwillbenefitgreatlyfrommarketresearchtoidentifygrowthsegmentsinthemarket.Marketresearchcanalsohelpcompaniesdiscoverfromtheircustomersandbrandloyalistswheretheywouldliketoseetheirfavoritebrandsexpand.Findingnewpathstomarket.Thisisanothermostlypositivetrendaccordingtoluxuryinsiders.Clearlyforsomeone-thirdofluxurygoodscompaniessurveyedheretheInternetisonelogicalnewpathtomarket.Marketresearchisalsokeytoidentifyingnewavenuestopursueinfindingnewcustomersandgrowingsales.TrendsPerspectivebyRolesPlayedinLuxuryMarketHereisaperspectiveonhoweachofthekeyluxuryinsidersegments—luxurygoodsluxuryservices/experiencesandsuppliersofservicestoluxurymarketers—viewthetrendsimpactinggrowth.TrendsIndexbyRolePlayedinLuxuryMarketFigure16:IndextotrendsbyroleplayedinluxurymarketLuxuryGoodsInsidersViewofTrendsAsthepredominantsegmentinthissurveytheperspectiveofluxurygoodsmarketerstendtodrivetheoverallindexratingsofeachtrend.Howeverluxurygoodsinsiderstendtoviewthechangesinconsumerdemographicsshoppingandspendingbehaviormergersandacquisitionsfindingnewpathstomarketandtheriseofthedigitalworldasmorenegativelyimpactingtheirbusinesses.Ontheotherhandluxurygoodsmarketersseediversificationofproductandservicesofferingsasatrendtheycanmoreeffectivelyusetogrowtheirbusinesses.TAKEACTIONBecausemostmarketresearchcoveringtheluxurymarketemphasizesthefactthatU.S.affluentconsumersinparticulararebecomingmoreexperientialandlessmaterialisticintheirpurchasesitisnotsurprisingtofindthattheluxurygoodsmarketerstendtoviewmosttrendsinamorenegativelightthantheotherluxuryinsiders.Thiscallsonluxurygoodsmarketerstomakethemostofeverypositiveopportunitytoconnectwiththeiraffluenttargetcustomersbuildbrandloyaltyandgrowsales.Especiallyimportantforgoodsmarketerswillbetotakeadvantageofthemanyshiftsinconsumersbuyingandshoppingbehaviorandproactivelyputthemselvesoutinfrontofthosetrends.ItmeansbeingmoreactiveonsocialmediagrowingsalesopportunitiesovertheInternetevaluatingdiversificationstrategiestakingadvantageofshiftsinconsumerspathstopurchaseandextendingproductofferingsintonewchannelsasappropriate.Ifitistruethattheaffluentconsumermarketisgoingmoreexperientialthenluxurygoodsbrandsaresittinginthecrosshairs.Theyneedtoturnbuyingusingwearingandenjoyingtheirproductsintoanexperience.Itmeansemphasizingtheexperientialaspectsoftheirbrandsanddeliveringtruecustomerexperiencesthroughoutthepathtopurchase.Goodcustomerservicesimplygetsabrandintothegame.Beingtrulyconsumer-centricandcustomer-drivenisessentialtodaytosucceed.LuxuryServices/ExperiencesViewofTrendsBycontrasttheluxuryservices/experienceinsidersviewinnovationchangingconsumerdemographicsandmergersandacquisitionsasmorepositivelyimpactingtheirsegmentofthemarketwhilefindingnewpathstomarkettheirservices/experiencesismoreofachallengetothemthanitisforluxurygoodsinsiders.TAKEACTIONWhereastheluxurygoodsmarketersfaceheadwindsintheirsectoroftheluxuryindustrytheserviceandexperientialmarketersareenjoyingaffluentconsumersshifttowardindulginginexperiences.Thechangesinwealthdistributionespeciallythatthericharegettingricherismostprofoundlygoodfortheirbusinessasarethechangesinhowluxuryconsumersspend.Yetasprimarilyserviceprovidersluxuryexperiencemarketersarechallengedtofindtherightservice-orientedprofessionalstodeliverthoseluxury-qualityservicestotheirclients.Theyalsofeelthepinchofgreatercompetitionintheluxuryservicespaceespeciallyasmoremainstreamtravelandhospitalitybrandsmoveintoluxurywithnewofferings.FurthertheyarebeginningtofeelthecompetitivethreatofthenewlyemergingsharingeconomyandtheexpandedaccessconsumershavetoluxuryexperiencesthankstotheInternet.Forluxuryservicemarketersitisimportanttorememberthattimeistheonetrueluxuryfortheiraffluentclients.Thereforeanywaystheycanshaveoffminutesevensecondsintheirserviceprocesseswillbegreatlyvaluedbytheircustomers.Andbecauseluxuryservicesareoftendeliveredbyperson-to-personcontacttheyneedtoemphasizeservicetrainingforallcustomer-facingstaffandempowerstafftoputthecustomerfirstinallinteractions.LuxuryIndustrySuppliersViewofTrendsIngeneraltheinsidersthatprovideservicessuchasadvertisingmediaandtechservicesandsupporttendtoviewthetrendschangingtheluxurymarketasmorepositivelyimpactingtheminthesupportroletheyplayintheluxurymarket.Inparticulartheyfindgrowthopportunitiesduetosocialmediatheriseofthedigitalworldfindingnewpathstomarketchangesinconsumersmediashoppingandspendingbehaviorchangesinconsumerdemographicsandchangesinhowluxuryconsumersdefineluxuryintheirlifestyles.TAKEACTIONLuxuryindustrysuppliersfocustheirbusinessesonsolvingproblemsfortheirclientsandhelpingthemmakethemostoftheiropportunities.Themanychallengesfacedbyluxuryindustrymarketersprovideampleopportunitiesforthemtogrowtheirbusinesses.Theresultsofthissurveypointtoareastheyshouldfocustohelptheirclientsfacechallengesandcreatenewopportunities.Chiefonthesuppliersclientlistofchallengesandopportunitiesissocialmediaandotherdisruptionsbroughtaboutbytheriseofthedigitalcultureandglobalization.Theyalsoassistclientsfindopportunitiestodiversitytheirbrandsandfindnewpathstomarket.Keepingclientsinformedaboutchangesinmarketingandadvertisingstrategiesandtacticsiskeyasishelpingthemunderstandanddealwiththemanychangesroilingtheconsumertargetmarket.AndlookingbacktothefindingaboutluxurymarketersbiggestchallengestogrowthFigure12theyshouldfocusonprovidingtheirluxurygoodsandservicesclientswithwaystofindnewcustomersandincreasetheirwillingnesstospend.Novelapproachestohelpingclientsbeatthecompetitionisalsoahighpriorityforluxurymarketersallthewhiletheywrestlewithchallengesbroughtonbytherisingcostofdoingbusiness.Deliveringthemostvaluetotheirclientsforthemoneyinvestedinsupportservicesiskeytosuccessforluxurysuppliersbusinesses.Figure17:Howtrendshaveshiftedfrom2017to2018TAKEACTIONFrom2017to2018mergersandacquisitionshavetrackedpositivemovementperhapsowingtothefactthatmoreMAarebeingdoneintheluxuryspacewhichisprovidingnewopportunitiesforluxurycompaniestoinnovateandgrow.InacquiringaluxurybrandacompanycangainfarmorethananewbrandtotaketomarketTheywillbeacquiringmuchneededhumancapitalwhowillbringnewbloodnewideasandnewapproachesintoamoreestablishedcompanywhereitismostneeded.WhenWalmartboughtJet.comandBonobositacquiredmorethannewbrandsbutitsnext-generationbusinessleaders.MarcLorefromJetisoneofthemostrespectednext-generationretailleadersandyoucanseehowmuchauthoritytheyaregivinghimDaveKnoxauthorofPredictingtheTurnsharedwithmerecently.AndBonobos*AndyDunnisanevenmoreprominentthoughtleaderinthenextgenerationofretail.SotheyhavebroughttwoamazingleadersintothefoldthatarenowpartofWalmart.”RecentacquisitionsintheluxuryspacenotablyMichaelKorsacquiringJimmyChooandCoachKateSpadeandrenamingitselfTapestryintheprocesssignifiesamovetocreatingAmericanluxurybrandconglomeratesalongthelinesofthebigEuro-three—LVMHMoetHennessyLouisVuittonKeringGucciSaintLaurentet.al.andRichemontCartierVanCleefArpelset.al.—orasGregFurmanfounder/chairmanoftheLuxuryMarketingCouncilsaidLVMH・izingAmericanluxury.”“Consolidationisthenaturalorderofcapitalism/saidChristopherRameyexecutivedirectorofTheHomeTrustInternationalwhichprovidesservicestoluxuryhomegoodsandservicesbrands.SoheforeseesthetrendofmoreMAintheluxurymarkettocome.Facedwithstagnantorslowgrowthsomecompaniesfinditbettertobuymarketshareratherthantoinvestalotoftimeanddollarstotryandstealit.DependingontheacquisitiontargetconglomeratescanbuymarketshareorasMr.Furmannotestheycanbuygrowthbypickingoffanemergingluxurybrandearlyasitstartsitsascendency.Itiseasiertodaytotakethisearly-stagestrategythankstotheInternetwheredesignersandentrepreneurscanbuildagloballuxuryconsumerfollowingfasterandmorecost-effectivelythanintheolddayswhen$300millionormorewasneededtoinvestinadvertisingandmarketingtolaunchaluxurybrand/1Mr.Furmansaid.MoreMAdrivenconsolidationmayprovethelifelineforboththeacquiringandacquired.Theconglomeratesareonanunprecedentedearly-stagebrandacquisitionbingebecausetheyneedtosurviveandthriveastheirlegacybrandsfailtorejuvenateandstayrelevant/saidMiltonPedrazaCEOoftheLuxuryInstitute.Thisneedforlegacyluxuryplayerstorejuvenateandstayrelevantmeanstheemergingluxuryplayersareripeforthepicking.Thelongtaileffectisstartingtocreateopportunitiesfortheupstartsinluxuryasmillennialsembracemorelocalandboutiqueofferings/Mr.Pedrazasaid.WiththeluxurybrandMAarmsraceonalsoinevitablewillbechallengestomakethoseconsolidationswork.TheEuro-threearemoreexperiencedatthisbutasMr.PedrazapointsoutTheystrugglewithacommandandcontrolmindsetthattendstostifletheyoungbrands/ThiscouldgivetheaspiringUS-basedgroupsanedgebuthealsosaidthattheyhaveyettoprovetheycanexecute.”“Thestrategicnexusonwhichitalldependsisntthenumbersonthebalancesheet/theLuxuryMarketingCouncifsMr.Furmansaid.Butthecompaniesbeingabletointegrateradicallydifferentcultureswithdifferentvaluesystems.Hegoesontopointoutthatfinanciallydrivenbuyersdonotdigdeeplyenoughintotheseareas.Inadditionasthecompaniesmergeandeliminateduplicatefunctionsitiscriticalthatthebestseniorleadershipstaffremainstoguidethemergedentity.Maybetheacquiredcompanyhasthebestmarketerbuttheyarethrownoverboardbecausetheoneintheacquiringcompanyismorevested/1Mr.Furmannotes.OnthewholeaU.S.-ledluxuryconglomeratewillbebestpositionedtotakeadvantageoftheemergingmarketopportunitiesintheworldslargestluxurymarket:theUnitedStates.ThenewAmericanLVMHhasfeetonthegroundhereandwillbefasterandsmarteraboutmakingthegoodpicksthantheEuropeanswillbeMr.Furmanpredicts.Theyhaveapan-EuropeanbiasandhavefortoolongbelievedthatintheStatestheonlyluxurymarketsthatmatteredareNewYorkandLosAngeles/notingthattheEuro-threeareheavilyskewedtowardEuro-indige-nousbrands.ThetimeisripeforaU.S.luxuryconglomeratetoemergebutitwillbebaseduponadigitallysavvynewworldmodelratherthananoldworldone.TheEuropeansunderstandtheimportanceofcraftsophisticationandaestheticintheluxurymarketbutAmericanshavetheedgeinunderstandingthenewwaysluxuryconsumerswanttoconnectwithbrandsMr.Furmansaid.Net/Net:Americanswilldoitbetter/hepredicts.BusinessConditionsintheLuxuryIndustryIncludedintheluxuryinsiders1surveywereaseriesofquestionsabouthowtheyseetheircurrentandfuturebusinessconditionsbothfortheluxuryindustryasawholeandtheirowncompanies.InsidersViewofBusinessConditions100=Averagetrends100aremorepositive100morenegativewhere100equalstheaverageorneutralneitherbetterorworseandvaluesover100areviewedasmorepositivebusinessconditionsandthoseunder100areviewedasmorenegativetotheindustryasawholeortheirowncompanies.Theluxuryindustryinsidersviewbusinessconditionsoverthepastyearaschallengingindeedwithanindexvalueof919pointsbelowaverage.Howevertheybelievethatconditionswillimprovefortheindustryoverallinthenexttwelvemonthsthoughnotsignificantly.OftheirownbusinessestheytendtoseetheircompanieshaveweatheredtheTowhatdegreedoyoufeelbusinessconditionsintheluxurymarket丸overallarebetterequalorworsenowcomparedtoayearagoTowhatdegreedoyoufeelthatbusinessconditionsintheluxurymarketoverallwillgetbetterstaythesameorgetworseoverthenextyearcomparedtonowTowhatdegreedoyoufeelbusinessconditionsofyourcompanyarebetterequalorworsenowcomparedtoayearagoTowhatdegreedoyoufeelthatbusinessconditionsinyourcompanywillgetbetterstaythesameorgetworseoverthenextyearcomparedtonowstormfairlywelloverthepast12monthscomparedwiththeindustryasawholebutfeelevenmorepositiveabouttheirowncompanysexpectationsforthecomingyear.Ofspecialnoteisthattheindustryinsidersexpecttheirowncompaniestodosignificantlybetteroverthenext12monthsindexvalueof110ascomparedwiththeluxuryindustryitselfindexvalueof

97.TAKEACTIONRecallingthetwotrendsmostnegativelyaffectingtheluxurymarketasawholespecificallythepoliticalturmoilmonetarypoliciesandeconomictrendstheluxuryinsidersbelievethesewilllargelyremainachallengethoughtheircompaniesshouldbeabletoovercomethem.Ingeneralthemajorityofindustryinsidersbelievethattheirowncompaniesarelockedandloadedtomakerealprogressoverthenext12monthsdespitethechangesthatthenewyearwillbring.BusinessConditionsinLuxuryMarketOverallLastYeartoThisInanalyzingthetrendinhowluxuryinsidersperceivecurrentconditionsintheluxurymarketoverallnowascomparedwithayearagobusinessconditionshaveimprovedsignificantlybutstillarenotgreatyet.Lastyearsome45%sawbusinessconditionsintheluxurymarketworsenowcomparedtoayearagowhichhasimprovedtoonly31%whosaythesame.Ontheflipsidetoday41%ofinsidersviewtheluxurymarketoveralldoingbetterthanayearagoascomparedwith29%lastyear.Bysegmentthereissignificantdifferenceintheroletheinsidersplayintheluxurymarketandtheirmeasureofcurrentconditions.Luxurygoodsluxuryservices/experiencesandsupplierstotheindustryallperceivecurrentbusinessconditionssimilarly.BusinessConditionsinLuxuryMarketOverallinNextTwelveMonthsInkeepingwiththemorepositiveperceptionofbusinessconditionstodaytheluxuryinsidersarealsomorepositivenowthantheywereayearagoaboutprospectsfortheindustryoverallinthecomingyear.Nearlyhalf47%ofinsiderssurveyedexpecttheluxurymarkettogetbetterin2018ascomparedwith43%whosawbrighterprospectsfortheindustryin

2017.Howeveronthismeasureluxurygoodsinsidersarelessoptimisticaboutoverallindustrygrowththanareluxuryservices/experienceorindustrysuppliers.Some43%ofluxurygoodsinsidersbelievethemarketwillimproveoverthenexttwelvemonthsascomparedwith50%ofbothservices/experiencesandindustrysuppliers.2018Figure20:Businessconditionsinluxurymarketoverallinnext12monthsTAKEACTIONThemostrecentreportfromBainCompanyfortheluxurymarketin2017predictsoverallgrowthof5%forthepersonalluxurygoodssegmentwithittoreach€262billionthisyear.Afterwhatitcallsarebootfrom2015-2016Bainseestheluxurymarketreachinganewnormalof4%-5%annualgrowththrough

2020.Takingcreditforthisexuberantforecastistherisingtideofluxury-leaningmillennialswithwhomluxurybrandsarefinallystartingtoconnect.Itsaninterestingtimeintheworldofluxury-themillennialstateofmindhaschangedthewaypurchasesaremadeacrossgenerationsandhaspushedluxurybrandstoredefinewhattheydelivertocustomers/saidClaudiaDArpizio.aBainpartnerandleadauthorofthestudy.“Forbrandsthatmanagetogetthisrightthereissignificantpotentialgrowthinthemarketforpersonalluxurygoodsintheyearsahead.ItwouldappearfromthismostrecentsurveyofluxuryinsidershoweverthattheyarenotquiteasoptimisticasBainintheirexpectationsforgrowthparticularlytheluxurygoodsmarketersthatarefeelingthecompetitivepressurefromconsumersshifttowardmoreexperientialspending.BusinessConditionsinTheirCompaniesoverthePastTwelveMonthsTodayamajorityofindustryinsiders54%feeltheirowncompanysbusinessconditionsareimprovednowoverayearago.Thiscompareswithonly48%whofelttheircompanysbusinessconditionswereimprovedwhensurveyedlastyear.Onthisquestionhowevertherearedistinctdifferencesinperceptionsofcurrentbusinessconditionsfortheircompaniesbasedupontheirsegments.SuppliersofservicestoluxurymarketerssuchasadvertisingmediaandtechnicalsupportarefarlessToWhatDegreeDoYouFeelThatBusinessConditionsofYourCompanyAreBetterEqualorWorseNowComparedtoaYearAgo2018■2017Figure21:BusinessconditionsfortheircompanieslastyeartonowToWhatDegreeDoYouFeelThatBusinessConditionsinYourCompanyWillGetBetterStaytheSameorGetWorseOvertheNextYearComparedtoNowBetterEqualWorse20182017Figure22:Businessconditionsfortheirowncompaniesinnexttwelvemonthsoptimisticaboutwheretheircompaniesaretodaythanayearagowithonly45%feelingthingsareimprovingfortheircompanies.Thiscompareswith58%ofluxurygoodsinsidersand60%ofservices/experienceinsiderswhofeeltheircompaniesaredoingbetternow.BusinessConditionsinTheirOwnCompaniesinNextTwelveMonthsAndinendingthissectionofthesurveyluxuryinsidersareoverwhelminglyoptimisticabouttheprospectsfortheircompaniesoverthecourseof

2018.Overtwo-thirdsfeeltheirbusinesseswilldobetternextyear.Inthisquestiontooluxuryinsidersaremoreoptimisticabouttheircompanysfutureprospectsthantheywereinlastyearssurveywhenonly62%expectedconditionstoimprove.Inthisquestionaboutprospectsfortheircompaniesoverthenextyearallinsidersregardlessoftheroletheyplayareaboutequallypositivethattheircompanieswillseeimprovementin

2018.TAKEACTIONLuxuryinsidersverypositiveexpectationsfortheirownbusinessesoverthenextyearsuggeststhattheywillpickupthepaceinmarketingandpromotionalactivitiesinparticularemployingInternetandsocialmediastrategiestofindnewcustomersandbeatthecompetition.Continuedexpansionacrossglobalmarketsalsoisexpectedinthecomingyearasthishashistoricallybeenaboosttoluxurybrands.Giventhechallengesmanyluxurygoodscompaniesfeelinfindingwellqualifiedemployeesthenextyearcouldalsobeagoodoneforyoungprofessionalstolaunchacareerintheluxurygoodsindustryaswellasayearofferingnewcareer-buildingopportunitiesforexperiencedmanagers.Withchangesinwealthdistributionandlessworryaboutconsumerswillingtospendtotradeuptoluxuryjuxurymarketersarealsoencouragedaboutgrowthfortheirownbusinessesinthenext12months.WhiletheyfacestiffcompetitiontheyareempoweredbytheInternetandsocialmediastrategiestocapturetheimaginationandspendingofthewealthyluxuryconsumerslookingfornewluxurygoodsandservices/experiences.Inparticularluxuryindustrysuppliershaveapotentialagoldmineinhelpingtheirclientsmaneuverthechangingmarketplacebroughtaboutbytheriseofthedigitalworld.Butasofyettheydonotappeartohavefoundthesecrettoturningtheripeopportunityintomeasurablegrowthastheirloweredperceptionsoftheircompaniesperformanceinthepastyeartestifies.Anincreasinglyimportantrolethatsuppliersplayfortheirclientsistokeepthemabreastofchangesandtrendsintheirtargetcustomersluxurylifestylesandhelpingthemshapestrategiestodealwiththosetrends.Ofspecialimportancetothesuppliersistohelptheirclientsdevelopnewwaystopositionluxurybrandsinlinewiththenewwaysthatluxuryconsumersaredefiningluxuryintheirlivesandexpressingitintheirlifestyleswhetherinfashionhometraveldiningandpersonalservicesused.Suppliersalsohaveavitalroleinhelpingtheirclientsunderstandandrespondtotheshiftsinluxuryconsumersbuyingandshoppingbehavior.What2018HoldsfortheLuxuryMarketTheLuxuryInstitutepredictsthatmorethanone-fourth28%ofaffluentconsumersplantospendmoreonluxuriesinthecomingyearwithfewerthan10%expectingtocutspendingin

2018.Thesefindingsarebasedonglobalsurveyamong4300affluentconsumersinsevenoftheworldsrichestindustrializednationsandMexico.Withmorethan90%oftheworldsaffluentconsumersexpectingtoparticipateintheluxurymarketthisyearthesurveyalsorevealedthattheexperientialluxurycategorieswillseethemostgrowthin2018includingleisuretravel.Forty-onepercentofthosesurveyedsaidthattheywillspendmorethisyearthanlastonluxuryhotelsairfare40%cruises38%andtours37%.Alsopredictedtogetaboostinaffluentconsumers1shareofwalletaredining33%healthandfitness30%automobiles30%entertainment30%technology29%andvacationrealestate29%.Ontheotherhandtraditionalluxurygoodscategoriesareexpectedtoexperiencelessvibrantspendingthanexperiences.Forexampleonly26%ofaffluentconsumerssurveyedsaytheywillspendmorein2018onapparelfollowedbyjewelry25%]andwatches24%.TheLuxuryInstitutesurveyalsorevealswherethosepurchaseswillbemade.Increasinglyitwillbeonlinewith21%ofthosesurveyedsayingtheywouldrathershoponlineascomparedwith17%lastyear.Furthermorethanoneinfour27%]luxuryshoppersarechannelagnosticwithnopreferencebetweenshoppingonlineorin-store.Yetthemajorityofaffluentconsumers52%prefertoexperienceshoppingpersonallyinastore.“Therisingpopularityofonlineshoppingreflectssuccessfuleffortsofmanyluxurybrandstoembraceanomnichannelapproachtoretailingbuttheongoingappealofthein-storeexperienceconfirmstheimportanceofbrick-and-mortar/LuxuryInstituteCEOMiltonPedrazasaid.Themajorchallengeremainsformanycompaniestotransformstoresfromcostcentersintoexperientialdriversofprofitablegrowth.Thiscanonlybeachievedwithproperinvestmentintechnologydesignandespeciallyinincreasingtheemotionalintelligenceandrelationshipbuildingskillsoftheentireorganization/Combininginsightsfromtheconsumer-sideLuxuryInstitutesurveyandthisinsidersviewherearethoughtsonwhat2018holdsfortheluxurybusiness:IntegrateDigital/Real-WorldCustomerExperiencesThedigitaltransformationaffectingallsegmentsofcommerceincludingtheluxurybusinesscallsoncompaniestoincreasinglyintegratetheironlineandin-storeexperiences.Luxuryconsumersexpectit.Consumerspathtopurchasenolongerislinear.Luxuryconsumersoftenstarttheirsearchforluxurysatisfactiononlinethenchoosetomaketheirfinalpurchasesin-storeonlineorthroughapersonalservicesuchasatravelprofessionalorconciergeservice.Thecriticalneedisforluxurygoodsandservicesproviderstobethereanywherethecustomerchoosestoengagewiththem.Itrequiresluxurycompaniesandserviceproviderstoprovideguidepostsanddirectioninallthemanywaystheconsumersarelookingforthem:onlinethroughsocialmediain-storeandfacetoface.TurningLuxuryGoodsintoLuxuryExperienceswithPersonalizedServiceAndwhileonlineandsocialmediastrategiesareexpectedtobetheprimarystrategicfocusforluxurycompaniesin2018enhancingthein-storeexperienceneedstotakeprecedenceaswell.Atitscoreluxuryretailisapeoplenotaproductbusinesstoday.Andbricks-and-mortarluxuryretailersalreadyhavetheirsecretweapontobeatonlinecompetitors—thepersonaltouch.Ifonlytheyusediteffectivelytopersonallyengagetheirbestcustomersinthebestmarketswithplentifulhappysmilingwell-trainedandhelpfulsalesassociatesratherthanforsakingthismostpowerfulweaponinthenameofcostcontrol.AnewsurveybyInMomentbasedontheopinionsofmorethan30000U.S.andCanadianconsumersprovidescontextaboutthecriticalimportancetocustomersforahumaninteractionduringtheirin-storeshoppingexperience.Thestudysgoalisabetterunderstandingoftheirshoppinghabitsduringthepathtopurchasefromtheirdecisiontovisitthestoretothein-storeexperiencetotheirfeelingspostpurchase/Recognizingthatcustomersaccesstoinformationdesiresforpersonalizationandimmediacyandcravingsfortrueconnectionsareupendingmillennia-oldbusinessmodels/1thestudyshowsjusthowcriticallyimportanttheperson-to-personrelationshipbetweenthecustomerandretailpersonnelisintodaysomnichannelretailenvironment.WhenconsumerswanttoorneedtobuyaproducttheyincreasinglyturntotheInternetbutwhentheywantashoppingexperience—averydifferentthing—theygotothestore.Retailersthatareconcernedwithin-storesalesshouldlooktoexperience/1InMomentreports.Themajorityofconsumerssaytheyshopinstoreforasenseofimmediategratificationandtheabilitytoconfirmquality.Converselyamajorityofconsumerssaytheyshoponlineforconvenience.Convenienceofthephysicalstoreisimportanttoosinceconsumersratedlocationasthetopreasontoshopin-storebutthatisfollowedbypreviouslygoodcustomerexperiencesinthatstorethatsetsuptheexpectationofgoodcustomerexperiencesintheirnextshoppingexperience.Andforthatthecustomersfeelingsabouttheirinteractionswiththeretailers*staffthatperson-to-personconnectionisthemostimportantfactor.Goodcaringandpersonalcustomerserviceontheshopfloorgreatlyenhancesthecustomersatisfactionresultinginagreatlyenhancedlikelihoodthatthecustomerwillreturntothestoreagainforhisorhernextshoppingexperience.HappyCustomersMakeHappyRetailersTheInMomentdatamakestheimportanceofthatpersonalinteractioncrystalclear.Overallapositiveexperiencewiththeretailersstaffincreasescustomers*satisfactionby33%.Butitisevenmoreimportantforfashionretailerswhoseeupwardsof70%greatercustomersatisfactionwhentheirshoppingexperienceisenhancedbygoodcustomerservice.Andahappiercustomerresultsinareturncustomer.Retailerscanbankonit.ItisamessagethatApplehastakentoheartwithitsgoalforitsAppleStoresnotjusttocreateasatisfiedbutadelightedcustomerwiththemoneyfollowingthatdelight.AuthorandleadershipexpertSteveDenningsaidApplehasgraspedthatmakingmoneyistheresultofthefirmsactionsnotthegoal.BydelightingthecustomerAppleendsupmakingmoremoneythanitwouldifitsetouttomakemoney.”CustomerDelightisLuxuryRetailsGoalRetailersarecompetinginamarketplacetodaywhereconsumerexpectationsofthecustomerexperienceareelevatedbeyondsimplyfindingandgettingaproduct.Thehumanelementinretailisthemostimportantfactorinattractingcustomersanddrivingsalesin-storenotproduct.Itisnotsomuchtheproductanymorebutthecustomerexperiencethatgivesthebricks-and-mortarretailerthecompetitiveedgeandwhichonlypeoplecandeliver.SurelyAmazoncansatisfyitscustomerswithwideselectioncheappricesandfastdeliverybutwhowouldeverdescribeshoppingonAmazon.comdelightfulDelightingcustomersmustbetheluxuryretailersgoal.Thattakespeopleinteraction.Theabilityforbricks-and-mortarstorestodeveloppersonalrelationshipswithcustomersistheirsecretweapon.Buttoomanyretailersarenotdeployingthismostpowerfulofcompetitiveweaponseffectivelyorconsistently.ChallengesAheadfortheLuxuryBusinessin2018Withluxuryinsiderspredictingavibrantmarketfortheirgoodsandservicesin2018andtheLuxuryInstitutestudyconfirmingtheirexpectationswhattrendsmayupendthoseplansWhatchallengesandroadblocksdoluxuryinsidersforeseeFortheanswertothosequestionsweturnedtotheexperts:theluxuryinsiderswhoansweredoursurveyandhaveastakeinthegame.Politicalupheavalandresultingmacro-economicshiftsOfalltheworriesthatkeepluxuryinsidersupatnightthemostprominentispoliticalupheavalbothathomeandabroad.Politicalturmoilthreatenstheworldorderandtheeconomiesbothathomeandabroad.Politicalinstab山tyisthemostnegativetrendfacingusbecausethataffectshowinvestmentsaremadewhichinturnaffectsthedisposableincomeonwhichretailrelies/saysthisinsider.AnothersaysPoliticaluncertaintyintheU.S.andabroadwithanexpectationthatoveralleconomicconditionsarelikelytosufferasaresult.Andthatuncertaintyisfueledbyourleaderstherespondentadded:NotknowingwhatTrumpwilldolocallyandgloballymakesforinstabilityinoureconomicoutlook.”Luxurybrandsneedconfidentaffluentconsumerssecureintheirwealthtogrowbusiness.Howeverthepoliticalandeconomicuncertaintyleadstolessconfidentaffluentconsumersfeelinginsecureintheirwealth.“Apapermarketcrashlooksinevitablewithmultiplemarketscurrentlyinunsustainablebubbles/anotherluxuryinsiderspeculates.Themiddleandlower-luxurymarketsaretiedintostockmarketsandwouldbebadlyimpactedinsuchacrash.”IncomeinequalityanddivisionsbetzveenthehavesfandhavemoresAlsolinkedtopoliticalturmoilisthegrowingculturalawarenessofincomeinequalitydrivingluxuryconsumersundergroundandawayfrommoreconspicuousconsumptionandluxuryindulgences.Wideningincomegapmaycausepeopletoseekalternativeitemsoflessorstatussoasnottobeseenasostentatious/oneinsidersays.Withthehavemoresseekingtolowertheirprofileitmakesitharderforluxurybrandstofindthemandservicethem.TherealluxuryworldwillgetmoreandmoreexclusiveandservicingtheHNWIwillbemuchharderthanbefore.Itwilltakemorespecializedpeopleandmoreattractivemarketingcampaignswithrealconsumerengagementtoreachthem/anothersays.Whetherrealornotthewealthyfeeltheysimplydonothaveenoughandsotheyholdtighttowhattheyhaveandseektogetmorewealth.Mostwealthypeopledontfeelwealthy/*thisinsiderrelates.°Theyarefearful.Theywanttomakemoneywitheverythingtheybuy.Theyaremostlyfearfuloflosingmoney.”Asthetrulywealthyretreatintotheirsecureenclavesthismarketsegmentthatisalreadyhardtoreachwillbecomeevenharder.HLuxuryconsumersarealreadyhardtoreachwhatwithadblockingprivatemediaecosystemsetc.Itisgoingtomakeithardertoconnectwiththeconsumer/1reflectsthisinsider.AndcomplicatingmattersevenfurtheristhattheHNWarereluctanttosharewithmarketers.“CapturingdataaboutUHNWIandHNWIischallengingsuchasspendinghabitsmediaconsumptionetc.Theseconsumersaretheleastwillingtotakesurveysorprovideinformationaboutthemselveseventothepointthatpurchasesaremadei.e.CRMdataandtiedtotheirbusinessesortheiradministrativeassistants/saysanother.DemocratizationofluxuryanditsperceivedlossofvalueWhilethereputeddemocratizationofluxuryhasgivenapointofentryfornewbrandstoappealtothenextgenerationofcustomersithascauseddisruptiontoestablishedluxurybrands.“Someofourleadingluxurybrandshavedilutedtheirsignificanceandimpactbyexpandingtheirproductlineswithmultipleentrypoints/1oneinsidersays.Theyarechasingafterabroaderbaseofclienteleasopposedtodifferentiatingthemselvesfromtheirimitators/Thedemocratizationtrendinluxuryisdisruptingthetraditionalrelationshipsthatluxurybrandshavedevelopedovertheyearswiththeirprimarycustomers:thesophisticatedwealthy.Separatingthenewconsumersfromthetraditionalconsumersisaclearsignofthecomingtrend.DuringtherecentSalonduLuxeinParisthemajorconcernoftheindustrypresentwashowtofighttheindustrializationoftheluxurygoods.Masstigeiswelcomeandnecessarybutmoreexclusivepersonalizedluxurywillcertainlyplayanimportantroleintheyearstocome.”Duetotherapidproliferationofnewbrandsrespondingtothedemocratizationforcesthepressureisontodefineanddifferentiatetrueluxuryfromtheposeurs.“Theproliferationanddemocratizationofproductmeansthatitshardertobreakthroughtellpowerfulstoriesandgetconsumerstotrulyconnectandimmersethemselvesinbrands/*arespondentsays.Andthedisruptionisnotonlyaresultofthedemocratizationofthebrandsthemselvesbutthedemocratizingofaccesstoluxuryisbroadeningthemarketandreachingnewcustomers.Luxurybrandsandretailersmustrespondperaluxuryinsider:Theproliferationoftechnologyandthedemocratizationofitsaccessforcesusalltohavetobecomeexpertsintwodemandingfields—ouractualbusinessandalsotechmaven一bothathomebyourselveswhilefulfillingourotherobligations.ResistancetochangeandlackofinnovationInthefaceofarapidlychangingmarketwithcustomersexpectingnewservicesandproductstomeettheirevolvingneedstheluxurybusinessiscalledontochangewithit.Butmanyinsidersfearthattheircompaniesarenotwillingtoleanintothechangesthattheyneedtomake.Thisinsiderworriesabouttherelativelackofrealinnovationthatpullstheindustryoutofitsmalaiseandcurrentconventions.Innovationistheneedbutsomefearthattheircompaniesaretryingtoholdbackthetide.[The]riseofthedigitalworldhaschangedretailforeverandisntstopping.Retail一especiallyluxuryretail一mustadaptquickerthanithas.Andanothersaystheproblemistheresistancetochangeofmanyheritagecompanies.Innovationdemandsamoreengagedproactivemanagementworkingintheluxuryindustryasoneinsiderpointedout:Themarketischangingthoughthishasbeenaconstantfromdayone—timeschange.Thebiggesttrendisthatmanyluxuryretailershavelosttheplot—justwalkintoastore!”Howevermanyoftheluxuryinsiderssurveyedarerisingtothechallengeandforcinginnovationontheirotherwisereluctantmanagement.Forthissegmentinnovationexclusivityandsearchforperfectionisnecessary/accordingtoarespondent.Forluxurybrandstheadviceisinnovateordie.“Theluxuryindustrywillcontinuetoreinventitselfinnovationandexperiencewillbecomeimportantinreachingouttothenewmillennialsaudience/saysthisinsider.CompetitiveencroachmentInthefaceofthechangingmakeupoftheluxurymarketemergingbrandsarenotrestrictedbytraditionorconventionalwisdomandsoareabletorespondmoreeffectivelymoreinnovativelyandmoreintunewiththechangingtimes.Theresultisvastlyincreasedcompetitivepressureasthisinsiderrelates:BrandsinnovatingandkeepingloyaltotheirDNAwillthriveandgethighermarketshareinamarketwhichisshrinking/AndanothersaysTheweaknessoflargerluxurycompetitorsisopeningthedoortoincreaseourbrandsmarketshare.”Thefailureofsomeluxurybrandstoadaptwillgiveemergingcompetitorsapowerfulpush.“LuxuryheritagebrandsshouldendurebutIwillbehappytoseesomeshakeout.Ilookforwardtoseeinghowsomebrandsintegratetechnologyandpersonalserviceintotheirexperience/onesays.IntheshifttotheexperienceeconomyluxurybrandscannotjustbringoutnewproductandhopetheygetahitCompetitionisrisingfromunexpectedplacesmostnotablythemassmarket.“Withsomuchcompetitionitwillgetmorechallengingtoconvincecustomerswhytheyshouldbuyaluxuryproductversusmassmarket/saysthisinsider.Andanotherseesthethreatas^over-saturationoftheluxurymarketwithgoodsthatarecompetingforluxurystatus/Oneinsiderseesopportunitiesforluxurybrandstothinkdifferentlyandinnovatewithnewproductsandservicesthatmakearealdifferencetothecustomers.Inthatwaytheycanconfrontthegrowingcompetitivethreats.“Theansweristoimplementmoredifferentiatedbrandstrategiestofaceanincreasedanddiversifiedcompetition/advisesthisinsider.FindingpathstogrowthLuxurybrandsmustgrow:itistheverynatureofbusiness.Inthefaceofintensecompetitionandtherapidrateofchangeinthemarketluxurybrandshavetosearchlongandhardtofindavenuesofgrowth.“Despiteourowncontinuedandsteadygrowthandthestrengthofoursolidmarketbaseithasallbeenuphillsince2008and2009whenourcustomerswerebluenotimpoverishedbutjustnotenjoyinglife!”revealsthisinsider.Atleastoneinsiderhasidentifiedthepathtogrowthforthebrand:“Thoseluxuryproductssuchascarstravelandwineswillcontinuetobesuccessfulduetothefactthattheyhavetakentheirutilizationofthesocialmediaplatformtothenextlevel.Itisthoseproductsthatutilizethesekeydriversthatwillbeonthecuttingedgetotheirviability:SocialmediaExperienceCustomerengagementPricePerceivedvalueincomparisontoonlineshoppingInvolvementintheircommunitiesandwhattheyaregivingback“Iftheluxurymarketusesanyoftheseoralldriverstheyw山betheonesthatwillwithstandtheheavycompetitionfromonlineshoppingandgrowsharesthisinsider.OpportunitiesAboundin2018Despitethechallengesopportunitiesaboundforluxurybrandsin

2018.Whatexcitesmearenewproductsandnewapproachestolifethataddresstheconsumer一bodymindandsoul.Thenewluxuriesareserenityvitalityandradiantgoodhealth.Whatencouragesmeishowwearecreatingnewdefinitionsofluxury/1proclaimsthisinsider.Amongthetrendsthataregivingnewhopeandbringingvitalitytotheluxurybusinessare:DigitalstrategiesAsnotedpreviouslydigitalmarketingbrandingandengagementstrategiesareatthetopofmostluxurycompaniesto-dolistsfor

2018.Ecommerceandmultipledigital/physicaltouchpointsisamustforcustomers.AugmentedrealityARwillbecomeamainstaywithinthenexttwo-to-threeyears/commentsoneinsider.Anothersharestheopportunitiesthatdigitalstrategiesholdforluxurybrands:Thecontinuousdigitalizationofthebusinessworldcreatesnewinnovativestrategiestoreachconsumers.”Digitalmediaisgivingconsumersabehindthesceneslookattheluxurylifestylethusmakingitmorerelevantandenticingtoawideraudience.Theincreasingprevalenceofsocialmediamakesiteasyforpeopletobeinsidetheaffluentlifestyle.Thisincreasestheappetiteforluxuryandbuildsgreaterawareness/notesthisinsider.Digitalstrategiesaretransformingthebusinessofluxurybutintegratingthesenew-agedigitalstrategieswithestablishedluxurybrandingsalesandservicetraditionswillbecriticalforsuccess.“WhatencouragesmeareARappsthatwillemergeoncetheiPhoneXdebutscontinuedmaturationofVR/AR/MRandAlcapabilitiesanduseofLBE[location-basedentertainment]providingmodelsforretailforluxurytocombinewithvisualpresentation-communicationandestablishedwhite-gloveservices/1thisinsidershares.Authenticity:CustomerswanttherealdealBringingauthenticluxurybackisidentifiedbymanyinsidersareawaytotapnewopportunitiesin

2018.“Asignificantnumberofclientsaremoreandmoresensitivetotheauthenticityofourbrandsandhowdistinctivewemakethem/saysthisinsider.Thisreturntoauthenticityholdsthesecretofsuccessformanybrands.rIfheritagebrandsgobacktowhatmadethemgreatconsumerswillcomebackwhentheyseethatauthenticity/1aninsiderexpresses.Puttingauthenticityforwardasanessentialplatformforluxurybrandsrequiresbrandstotelltheirauthenticstoryandtellitwell.Authenticstorytellingisstillauthenticstorytellingandresonateswhenwelltoldnotesthisinsider.“Themore-connectedconsumerwillchallengeluxuryproviderstobebetteratengagementandconstantlydriveauthenticitytonewheights/1isthecallforaction.Butitdemandsthatbrandsstaytruetotheirstoryofauthenticityasthisinsidercautions:TheluxurymarketreliesonaddingvaluetoanyproductConsumerawarenessandappreciationaboutauthenticityandartisanprocessisgrowing.Toomanymanufacturersdeceiveconsumersaboutthemanufacturingprocessmaterialsandcountryoforiginsourceinformation.Consumerswantdeepinformationabouthowandwhereaproductis.Weneedtoenforcelawsregardingcountry-of-originmarkingsothatconsumersareawareofwhatismass-manufacturedartisanmadeculturallyauthenticorjustanimportedcopy.Luxuryconsumersmusttrusttheinformationthatbrandsshare.Suchinformationmustbetherealdeal.“Luxurybrandingisnotjustaboutalogo.Itsaboutalltheinformationrelatedtohowaproductwasmade.Trustisabigissueintheluxurymarket/thisinsidershares.ReturntoluxurysartisanrootsAreturntoluxuryartistryandartisanalrootsisonewaythatmanyinsidersseetheluxurymarketgoing.“Peoplearegettingwearyofeverythinglookingthesamei.e.PotteryBarnfurnitureLouisVuittonbags.ItprovidesawindowofopportunityfornewuniqueproductswithartisanalvaluetocatchtheirinterestHoweverclienttrustintheartisanscraftsmanshipandvaluewillbuildslowlythisinsidernotes.AndanothersaysPeoplearefindingvalueinartisanalgoods.Thechallengeistobroadenthatattractionandappeal.”Asbrandsdigmoredeeplyintothemindsetoftheirluxuryconsumersandreturntotheirartisanrootsluxurybrandscanregainrelevanceandbuildappeal.“Thereisanincreasingflighttoquality.Brandsaremovingtowardsgenuineartisancraftsmanshipoverbadgingandbranding/remarksthisinsider.Theopportunityinreturningtoluxurysrootsishugethisinsidershares:Bringbackartisansmakeexclusiveproductsandtakeexclusivecareoftheclientelethathasputtheluxuryindustrywhereitistodayandhelpitgrowtomorrow/1ValuesaddeddeliverrealvaluetothecustomerAsthedefinitionofluxuryinthemindsofconsumersshiftsluxurybrandsarecalledontoaddadditionalvaluesintotheirbrandingpromise.Thereareendlesspossibilitiesasbrandingtodaygoesbeyondproduct/oneinsidersays.Brandsarereturningtobespokeofferingsinlimitededitions.Itisaboutconnectingwiththeconsumersowearerelevantandtheyshopwithus.Productstylevalueinnovationdifferentiationhigh-touchserviceareinvogue.Addingvalueintothebrandingpropositionrequiresthatbrandsalignwiththevaluesoftheircustomers.Thereisacommitmentintheindustrytounderstandthequalityofluxuryinthecustomerstermsandpresenttheattributesofluxuryproductsandserviceseffectivelyandconvincingly aninsidersays.Luxurymustberelevantnotjusttothefewbuttothemanytoinspirethemtoreachfortheultimate.Luxurycanberedefinedanddoesntnothavetoequatetobeingrichandglutinous.Itrequiresbettermarketingandbrandsnotbeingsooutoftouchwithrealpeople/saysthisinsider.Togrowtheconsumermarketforluxurygoodstherehastobemorethanpriceandexclusivity.ThereisnewinterestinMadeinAmericaforexampleandfindingwaystoshowhowthesegoodshelpAmericansgetmorejobs.Luxuryhastobesociallyinvolvedandnotjustforentitledfew.”Sustainabilityandenvironmentalconsciousnessalongwithsocialawarenessisbecomingmoreimportanttotheluxurycompaniesinwhichtheseinsidersserve.Brandswithhigherenvironmentalandsocialsustainabilityandcompanytransparencyinthefuturewillhaveastrongerconnectionandloyaltyamongpotentialcustomers/*saysthisinsider.Thehighercostsassociatedwithluxurymusttranslateintomorevalueforthecustomerswhoinvestasthisinsidershares:Thepeoplewhopurchasedbasedonpriceandconveniencealonewillcometounderstandthattheproducttheypurchasedhasnthelduptouse.Thiswillchangetheirattitudetowardtheirnextpurchaseinsistingonqualitythatluxurybrandsoffer.Peoplearestartingtorealizethatyougetwhatyoupayfor.ExquisitedesignnevergoesoutofstyleAhallmarkofauthenticluxurywithartisanalworkmanshipisexquisitestyle.Designsophisticationandstylenevergoesoutofstyle.Thisinsidersaysthegreatestopportunityinluxuryliesinconsumersirresistibleneedforbeautifuldesignthatistimelessandmadepurposefully/1Thevalueofluxurydesignandstyleistheindustrysanswertofastfashionandimitators.Therehasbeenacheapeningofallthingsfashionandadilutionofonce-greatdesigners.Butstyleandtrendsarebecomingmoreimportantdecision-makingfactorsthanperceivedbrandvaluethisinsidersays.Whilestyleanddesigntrendsareshiftingfasterthaneverluxurybrandswithneedtostayinfrontofthosetrendsandpresentproductsthatinspireconsumerstoreachtoanewlevel.Thereisashiftfrombadgebrandstobrandsthatfulfillaninternalneed.Thecontextischangingwhichwillbringanewdefinitionofluxury.Wemustdevelopbrandsthatoffermoretoluxuryconsumerswhorequireit.InsummarythisinsidersaysConsumerswantareturntodesignandstyle.Theydemanditofus.”ShifttoexperiencesgivesluxurybrandsnewplatformonwhichtoconnectAndfinallytheexperienceeconomycallsonallintheluxurybusinesstoconsidertheexperientialsideofthepurchaseexperienceasthisinsiderrecognizes:Luxuryisanexperienceandconsumerspendonexperiences.Thatrequireswetranslatethepurchaseintoanexperience/Thisemphasisonexperiencescreatesanewplatformthroughwhichluxurybrandscanengagewithcustomersanddelivermoremeaningfulmessages.Thefocusonexperienceopensthedoorsofinterestandinvolvementforourconsumersbothyoungandolder.Wecanprovidethoseuniqueexperiencescombinedwithauthenticstoriesandmessageofrealchangeinthechoiceswemakesaysthisinsider.Wemustmaintainanemphasisonwhite-gloveservice.Theinterestinexperiencesoveraccumulationofgoodsmeansourproductsmustbecomepartofgreatmemoriesmadebyourcustomers/1thisinsidershares.Theexperientialconsumerwillreturntophysicalstorestogetthosegreatexperiencesevenifhisorhersearchforluxurybeginsonline.“Thependulumisswingingbacktoshoppinginstoresforproducts.YoucantgetagreatshoppingexperienceontheInternet.Youlosethenuanceandknowledgewhenyoudonthavetwo-wayengagementinastore.Thisgivestheconsumerconfidencethattheyaremakingtherightchoice/1saysthisinsider.Thekeytotappingintotheexperiences-ledconsumeristomakeameaningfulcontributiontotheirlifestylesthisinsidersharesThereisanopportunityforbrandstofindwaystomakepositivemeaningfulchangewithhowtheyaddvaluetotheirconsumerslifeandtheworld/WhattoWatchforinLuxuryin2018Theluxurybusinessisbackandstrongerthanever.ThatisthekeytakeawayfromthiseditionofLuxuryDailyandUnityMarketingsStateofLuxurysurveyconductedamong599luxuryindustryinsiders.Whilesomeheadwindsremaintheluxuryindustryinsiderssurveyedbelievetheyhavetherightstufftocompeteintodaysrapidlyevolvingmarketforluxurygoodsandservices.Whilecutting-edgedigitalstrategieswillcontinuetohelpluxurybrandsconnectwiththenextgenerationofconsumersitisnotnecessarilythemagicbullettobringtransformationalinnovationtothebusiness.BrandsmustdelvedeeplyintotheirintrinsicvaluesandmakesurethatthedigitalstrategiesadoptedreflectthatIndeed2018willbecometheyearwhencustomersnotbrandstaketheforefront.Thatcallsonbrandstodevelopnewstoriesofluxurythattrulyconnectwithconsumervaluesandlifestyles.ForbothluxurygoodsandservicesbrandsinspiringcustomerstostepuptoluxurywillrequireafocusondeliveringtheauthenticartisanaLdesign-drivenresponsibly-madeandsocially-consciousvaluespromisedthroughtheirmarketing.Iftheydonottheywillcreateapathfordisruptiveemergingbrandstoconnectwiththosecustomersinmorerelevantandmeaningfulways.Luxuryisatoncetimelessyetmustremaintimely.Luxurybrandshaveanopportunitytobringtheiroperationsandmarketingcommunicationsintothe21stcenturywhilemaintainingtheintegrityandauthenticityoftheirtraditionalluxuryqualityartistryworkmanshipandage-oldvalues.Throughout2018wewillcontinuetoseetheluxurybusinessevolvedealingwiththechallengesthatstillplaguetheindustrybutrisingtothemanyopportunitiesthatariseaswell.TotalLuxuryGoodsLuxuryServices/ExperiencesSupplierstoLuxuryCompaniesProductorserviceinnovation115114117114Socialmedia113112112117Riseofthedigitalworld113110111119Diversifyingproduct/serviceofferings112114110114Findingnewpathstomarket111108106116Globalization107105109109Changesinwealthdistribution103100105106Changesinluxuryconsumersmediahabits999799105Changesinconsumerdemographicsi.e.maturingbabyboomersriseofmillennials9892106104MergersAcquisitions96961029Changesinhowconsumersdefineluxury959298101Changesinhowluxuryconsumersshop958996105Changesinhowluxuryconsumersspend938796102Findingretainingwellqualifiedemployees92929493Monetarypoliciesandeconomictrends88869489Politicalinstability70697169。