What’s the future of luxury?

by Johannes Ader, ESSEC MBA alumnus, 2016

From Left: Deanna Chuang, ESSEC Global MBA alumna (2018), Vanessa Friedman, Fashion Director and Chief Fashion Critic at The New York Times, and Johannes Ader, ESSEC MBA alumnus (2016)

ESSEC was a partner of The New York Times International Luxury Conference held in Hong Kong this year. The subject of this year’s conference was “What's Next: The New Luxury World (Dis)Order”. More pressing than ever before, leaders in the luxury industry are facing global challenges, requiring them to profoundly rethink the essence of today’s luxury industry.

In this 15th edition of the International New York Times Luxury Conference, Fashion Director Vanessa Friedman welcomed top CEOs, entrepreneurs and thought leaders to share and discuss their take on the future of the luxury industry.

The opening speech of Qiu Yafu, Chairman of Board of Directors of Ruyi Fashion Holding Group, China’s largest textile manufacture and owner of brands such as Bally, set the tone for the entire conference by stating ‘Change is the only constant in our industry’, emphasizing that companies have to adapt and rethink.

Mr. Qiu went on to illustrate how traditional customer segmentation is rapidly becoming obsolete today, as the future lies in customization and co-creation, for product and service experiences. His thoughts were later echoed by Ian Rogers, Chief Digital Officer of LVMH, who coined the term ‘market of one’, describing a hyper-personalized approach to customer engagement. Rogers remarked how the luxury industry, even today, is largely still an industry driven by strategies that belong to the previous century.

This urgent need for change was the fuel for a passionate debate titled “From Savoir-Faire to Faire Savoir”, hosted by ESSEC’s Prof. Simon Nyeck together with Elise Gonnet, Managing Director, Managing Director L’ÉCOLE Asia Pacific School of Jewelry Arts, and Nicolas Luchsinger, President Asia Pacific, Van Cleef & Arpels.

Throughout this session, the speakers, in vivid exchange with the audience, discussed the challenges brands face in providing relevant experiences to consumers in the modern era, while staying true to heritage and attracting a Millennial audience.

Centering brand experiences around the changing ways customers connect with  luxury brands remained a key matter throughout the panels.

John R. Hoke III, Chief Design Officer of Nike Inc. and Alan Joyce, CEO of Qantas, remarked how important it is that brands stand for something. Brands have to have meaning, that customers can identify with, even if such positioning may mean that companies may lose the support of some. Whether it is societal causes, political positioning or environmental efforts, customers demand a meaningful engagement in return for support.

This notion was seconded by Cédric Charbit, CEO of Balenciaga, whose designs cause a lot of buzz, expressing the brand’s missions, including their support for the World Food Programme for example.

In conclusion, this year’s conference ended on an optimistic note, embracing the fundamental changes the luxury industry is facing. At the end of the day, the principle of “adapt or die”, is just as relevant for the luxury industry. Companies need to adapt in order to remain relevant. From constant technological evolution to a dramatic shift in the retail world, to what’s next for China, India and the West to the pervasive demand for transparency and moral equity, time will tell how luxury companies can win in a world where the only constant is change, and the biggest risk is taking no risk at all.

No comments:

Post a Comment