COVID-19 & The Luxury Market

Ever since COVID-19 hit at the beginning of 2020, we have seen a worldwide decline in sales across the luxury market. This is due to the fact that many consumers have started to fear the luxury retail space, and reassess the way they make purchases. As a result, to survive over the last eighteen months, luxury brands have had to move online and into the digital world.

There has been a large shift in consumer behaviour amidst the COVID-19 crisis, with increased interest in digital experiences and online content. Consumers are looking more heavily at the brand as a whole, to assess whether the products stand for what they believe in, and are what they are willing to spend their money on.

How To Optimise Your Strategies:

Firstly, social involvement is being carefully assessed. Brands that are more transparent seem to be doing better.“Brands like Burberry and Prada approached the situation by being transparent about how the coronavirus impacted their operations and keeping stakeholders updated on store closings, business hours and measures taken.”

Secondly, it is important to maintain brand exposure by creating more content to put out to consumers. “A good example of such a technique is how Dior live-streamed its runway show for the 2020 autumn/winter collection on Weibo.”

Thirdly, previously luxury brands relied mainly on physical stores and offline advertising. Nowadays, as everyone has been required to stay at home more, we've seen a requirement for a shift to digital platforms. Here brands are able to reinvent themselves and create more content for consumers and create excitement, they are also given a platform to showcase the parts of themselves they love.

Lastly, direct-to-consumer brands have been doing better as companies are able to speak directly to their consumers for a better customer experience and allow for a better user experience.

What 303 Thinks:

At 303 we feel as though this shift in consumer behaviour is important to keep in mind. It is best for brands to apply these strategies and transform themselves as we are shifting into the digital world. Get in touch for our help with your paid media strategy.