The Growth Distillery’s latest study, ‘The Forces Shaping Luxury’, revealed a significant shift in Australia’s luxury landscape driven by the perfect storm of inflation, cost of living pressures, and evolving generational values.
While luxury remains aspirational despite economic challenges, future luxury consumers now seek clear emotional and practical justifications for their spending, presenting both challenges and opportunities for brands.
The research identified six emerging profiles representing tomorrow’s luxury consumers:
- Young, Free and Earning: High-income young adults seeking status through quality and recognition.
- Freed Up and Returning: Older Australians re-engaging with luxury, driven by emotional reward.
- Property Wealth Builders: Younger achievers prioritising quality and personal values.
- Driven, Diverse and Rising: Ambitious, culturally diverse males who view luxury as a symbol of success.
- Wealth Transfer Recipients: Newly inherited wealth, seeking status and exclusive experiences.
- Non-Traditional Wealth Creators: Young entrepreneurs prioritising innovative, individualised luxury.
The study highlights three key strategies brands should harness to unlock new growth:
- Tap into deeper emotional, cultural and personal values to build lasting relevance. With 49 per cent of luxury consumers prioritising experiences compared to just 19 per cent favouring tangible products, deeper meaning is now more important than ever.
- Engage the six emerging luxury profiles through bespoke narratives that align with their unique values and aspirations. For example, engage those Returning to the category with emotion first messaging that positions luxury as a reward, or engage Non-Traditional Wealth Creators by highlighting something new, innovative and thought provoking, to spark their curiosity.
- Leverage gateway categories such as beauty, jewellery and watches which show up to 70 per cent intent crossover, to facilitate growth, expansion and loyalty across luxury segments.
“Our research shows that luxury’s future lies in emotional and cultural resonance, not just exclusivity and price,” said Bethan Hockey, The Growth Distillery research director.
“This disruption offers a unique opportunity for luxury brands to lead market transformation. Those who can balance short-term performance with long-term legacy building will emerge as winners in this new luxury landscape.”
The Growth Distillery is an independent research think-tank, powered by News Corp Australia.
