By Matter of Form

Our annual outlook on the state of luxury, in our present moment and the long term. Framed by three movements flexing the market, from the fall of status to AI, automation and the brand multiverse, this report captures our take on it all, powered by studio-wide insights and sector-wide research.

Luxury is one of those intangibles that doesn’t just divide opinion, it cracks open social chasms. Especially because from a definition and meaning perspective, the term is currently occupying a precariously liminal space. Plenty are yet to realise that though – specifically the willfully ignorant and/or those ‘too posh to function’. The so-called ‘forward-thinkers’ and supposed tastemakers who chase fleeting fads; gloryseekers who get their hit from a headline. 

Cynical? Maybe.

The reality is too many of us are confusing what’s trending with trends themselves. Trends are not hashtags, they’re directions – lines along which energy and activity flows. Not quite Barbiecore, they’re significant, persistent societal or cultural shifts. Not chasing cool to win sales.

These culturual constructs are where the opportunity lies for brands. Particularly with luxury where, superficially, the only unifying factor is price. Luxury is thought of as this amorphous thing, but it’s not one thing. It’s coded in a million different ways, vastly different depending on which category is at play. Context is everything in an overly-generalised world. As is thinking – and seeing – differently.

We don’t dislike the word luxury to be contrary for the sake of it. We dislike it because, in its current sprawling context, it feels dusty and lazy; inactive instead of proactive. It’s too traditional, too buttoned-up. Too often elitist and arrogantly superior with no evidence to support that claim, instead resting on laurels of ‘exclusivity’. 

Whereas actually, all the perks, privileges and profits attached to luxury – liquid clientele, bigger budgets, creative scope – means any brand described as such should be superior, category-defining even. Driven by R&D focused on the inside as much as the outside; elevated supply chains; second-to-none experience; not being afraid to spend money to do things better than how it's been done before. Especially when ‘poly-crises’ is an accurate summary of the world stage.

The Global Wealth Landscape

Understanding the global state of wealth as it is now is essential if we’re going to envision the luxury landscape and its horizon. It’s all relative, etc., etc.

To do so, we have to see beyond the front-page bar charts and line graphs. We have to go deeper, studying the global drivers that become the unseen slipstreams on our maps; the flowing arrows accelerating market expansion in some parts of the world yet stymying growth in others. Drivers like evolving demographic lay, cultural waves, advanced technological adoption, geopolitics, climate chaos, migration, travel, urbanisation, and, tedious it may be, COVID’s lingering effect. 

Within the next decade or so, much of Europe and the United States will have record old-age populations while young workforces will grow exponentially in regions across South and Southeast Asia, the Middle East and Africa – regions previously overlooked by luxury in favour of the West’s historic monopoly. 

For these brands, significant swathes of their clientele are considered to be ‘ageing out’: a sentiment that has driven many marketing teams’ abrupt pivots toward generations Z and Alpha. In terms of spending power, we’re looking down the barrel of The Great Wealth Transfer, the end of boomer-majority and much of what their world represented. 

At the same time, a total focal 180° to younger audiences poses the risk of fractured brand perception and alienating loyal – potentially decade-spanning – clients who may not have the majority spending power but still possess a healthy portion. Longer lives and the money divide are making way for a flat age culture which, paired with other shifting social paradigms like gender fluidity, beg the question: are we really post-demographic? 

When it comes to audience capture, demographical data is being shunned by a select few – regarded as entirely out-of-touch and non-representative of modern audiences. Though inclined to agree, shifts in demographic lay can be indicative of greater shifts (in lifestyle, behaviour, values) at a foundational level, when bolstered by psychographic research and patterns. 

The whole world knows ‘ultra-high net worth’ is a lazy classification, because no one person is defined by a number alone. No matter how many zeros are tacked on the end. 

When we talk about meaningful innovation with our clients, we start by debunking a few myths. The first is that innovation is the equivalent of decoding the U/HNW individual. The industry as a whole is guilty of conflating this cohort into a two-dimensional segment with a homogenous set of needs, wants, behaviours and aspirations. But sharing a wealth bracket does not reconcile every other facet of personality into a singular persona. Nor does sexuality, gender, age, race or ethnicity.

THE DIVERSITY QUOTIENT

Wealth is flexible. We exist in our kids' TikTok channels. Teenagers have investment portfolios. The private members’ club – a definitive symbol of old luxury – has been coopted. What was once a very siloed, snobby, stale, “this is our world” kind of luxury, now doesn't exist. 

One of 2023’s big trends was the rise of diversity, inclusion and equality in the ESG agenda. What we’ve seen since is an abrupt plateauing and now vanishing of that priority. The transparency of so-called glass box brands has gotten ever-foggier as trends ‘easier’ to implement have emerged. 

Diversity shouldn’t be a purpose, it should be a given. It should be embedded into the sinews of our collective psyche, not a tokenistic move to make a sale. So though we encourage clever brands to push forward into a future framed by these shifts, don’t negate the importance of the callouts that came before.

Key Trends For 2024

EMERGING: THE FALL OF STATUS

SOCIAL RANK HAS BEEN LIQUIFIED

The pessimists among us are perhaps familiar with the acronym VUCA (volatile, uncertain, complex, and ambiguous). Now BANI (brittle, anxious, non-linear and incomprehensible) is emerging as a more accurate description of societies today. 

Though constructed with fairly negative vocabulary, these acronyms reveal a desire among cultural theorists to organise a disorderly public. Disorderly thanks to the blurring of previously impenetrable lines of class that has served to fragment identity further, creating a kaleidoscopic society that isn’t linear or hierarchical, but colourful and liquid. Mutable and in motion. Rapid and permeable. 

In those fluxes lies a duality of status and culture. In 2023, the dictators of status in modernity aren’t necessarily the aristocracy. The tie between class and cultural power was severed long ago, when subverting convention became the new vogue and the figures front-and-centre of our comms channels shifted from the financially elite to those with a form of cultural conviction and social capital. They’re not the influencers of the 21st century’s early teens, they’re the curators of current tastes, rituals, aesthetics and knowledge. 

The fabric of status is being unpicked and intricately rewoven into a pattern of tribalism and fandom. It seems that life’s wear and tear – especially that of the last 3-4 years – has actually made us more connected, rather than stripping it away. Encouraging individuals to cluster in their preferences for certain arbitrary rituals, to seek out belonging ultimately. 

As a whole, we needn’t be in denial over the nature of the human condition. We crave status and pursue aspiration. But neither is about superiority over other individuals or groups. 

Curation is the crux of modern aspiration. We shape ourselves in reference to various things we feel are reflective and expressive, on an individual level and collective basis. 

Take Apple’s tech. The ubiquitous demand for iPhones and MacBooks stems from far more than their high price point. There are undoubtedly more expensive, luxurious, digital devices to be had but the association that comes with the product – the owners are creatives, those who value craftsmanship and aesthetics over supreme technological function – is what people are buying into. 

According to VICE Media Group, 9 in 10 young people say authenticity is incredibly important to earning trust and Merriam Webster crowned ‘authentic’ as their Word of the Year 2023. Not exactly groundbreaking data but does affirm one thing: to get audiences onside, brands need to live up to perception. That’s easier said than done when perception’s literal definition amounts to subjective interpretation. But there are proof cases.

In 2022, cult activewear label Patagonia dominated headlines with the news that the brand’s ecologist founder, Yvon Chouinard, would be donating the entire company to a trust and non-profit in order to fight climate devastation.  

For four decades Patagonia has been the pinnacle of environmental leadership, in the corporate world and wider culture. They were one of the earliest B Corps, have been donating 1% of profits to environmental groups since the 80s and actively campaign against fast fashion and unbridled consumption. Their ecological principles are hardline and their actions match up. 

Another example twists age into an aspirational quality. Earlier this year Beck’s Brewery decided to not only acknowledge the reality that our taste buds change with age with Beck’s 70+, but position it in such a way that younger buyers look forward to the day they can try it. Exclusively made for the taste preferences of more mature consumers, the launch was accompanied by an anti-ageist campaign and a 70+ VIP event to sample the beverage. The campaign’s creative director summarised the move well: 

“Aging well is being able to continue enjoying all the most delicious experiences in life – including a great beer. It is a dialogue with the pro-aging culture movement, which understands that age does not limit people’s desires and aspirations.” – Rodrigo Barbosa, AKQA.

The perfect liquid example of liquid social status.