GENERATION GAPS AND THE EVOLUTION OF STATUS
by THE BERGSTROM GROUP on June 27, 2012
In a recent interview in Reuters, several young women in China stated that they regard Louis Vuitton as out of fashion. We have witnessed first-hand the evolution of luxury in China, the evolution of status if you will, and this was not a big surprise. We have watched LV push distribution and brand far and deep across the mainland. According to one of the Reuters interviewees, “even an ayi (housekeeper)” can buy an LV purse. In this case, the young interviewee is not talking about affordability, she is talking about access. For these consumers, luxury should be safely out of reach for some to keep it attractive for others. The fact that LV is widely available is the very reason they don't want it.
For Western consumers, luxury can be associated with personal heritage and tradition. Many Western consumers prefer brands that have been in their collective family memory for generations (my mother wore Chanel, my grandfather carried a Gucci). As luxury brands were introduced in China in the 1990s, Chinese consumers can't call upon a personal sense of nostalgia to connect with a brand, they look forward.
While Louis Vuitton has been named the world's most valuable luxury brand for seven consecutive years, there is a movement among young Chinese away from widely recognized marks in favor of less exposed brands. While many brands approach luxury in China with obvious flash and glitz, we have noticed that people’s attitudes and expectations vary by generation. In a recent study, we acutely noted this generation-based gap in attitudes and behaviors.
For older consumers, luxury products are wielded as a symbol of having (and being) the best. They are more inclined to buy products that are easily recognized as luxury goods because they demonstrate obvious - and thus preferable - symbols of success.
Meanwhile, for younger consumers (trained to hunt the next new thing), a brand may be more appealing if it is less well known, a true find that they can show off to their friends. As the first generation raised on luxury, Chinese youth endeavor to push beyond brands that they have grown up with to scout out new marks and experiences that will resonate and inspire appreciation in their own circles. For them, the stakes are higher and more personal. Luxury is about charting a new map, not tracing old steps.
The Bergstrom Group is an insights consultancy with a passion for telling the story of new China.
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