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How to Sell Luxury Products to Millennials

Luxury retailers need a less traditional approach if they want the ‘me generation’ to buy their products. Here are some tips for reaching this coveted cohort of consumers.

Jan 22, 2020 9:15 AM   By Leah Meirovich
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RAPAPORT... Millennial consumers are independent, vocal, tech-savvy and used to getting what they want. They have disposable income and aren’t afraid to spend it on things they believe add value to their lives, no matter the price tag. But successfully enticing this market into your store is not as easy as it was with their moms and dads, and retaining them can be even more difficult. That’s why it’s essential to understand what makes them tick, and how to capture their loyalty.

Create a good user experience

“Millennial shoppers want an experience” is a common talking point in retail. But what does that mean? What constitutes an experience, and what type of experience is this generation looking for? Most importantly, how much will it cost you to make it happen?

“Experience has become synonymous with millennial consumers, and in jewelry and luxury goods, opportunities abound to deliver a memorable moment,” says Kathryn Bishop, research and insights director of the Women’s Jewellery Network (WJN). “But here’s the thing — experience doesn’t have to be costly or ostentatious. It can be as simple as offering shoppers a glass of champagne and taking time to listen and learn about their lifestyles, preferences and personalities before pushing product their way.”

Karen Barry, a senior consultant with retail sales trainer The Friedman Group, agrees that millennials aren’t necessarily seeking a flashy experience, but something that gives them a link to the product they are considering for purchase.

“Millennials…are more enticed by an item’s personal meaning or story,” she emphasizes. “Tell them about the mining process, or how your buyer selects specific items, or anything that connects the piece to people or otherwise brings it to life.”

Even creating experiences that require you to splurge a little can more than reward your efforts by forging bonds with new customers.

“Have an event where you invite your best millennial clients to come into your shop, bring friends and create a wish list,” says Kathleen Cutler, a sales expert for high-end jewelers. “Ask for the name of the person who would purchase off the wish list, and you can reach out to them with the suggestions.”

Cater to the individual

Unlike bargain goods, luxury items appeal to millennials because they are often one-of-a-kind products, and this generation considers itself highly individual. Millennials don’t want to wear “someone else’s engagement ring,” as bespoke jeweler Taylor & Hart declares in one of its ad campaigns.

“Millennials don’t want to look like everyone else,” states Bishop, stressing that retailers need to keep this attitude in mind when choosing their stock and marketing their products.

Barry concurs: “Individuality matters to millennials. When selecting products for your merchandise mix, include elements of current trends while still ensuring each piece is unique.”

Cutler suggests offering customizable products, such as high-end nameplates that spell out the name of a significant other or a memorable date. But beyond that, she advises, “know your designers and their why, which is always best told through strategic storytelling. The millennial customer wants to feel connected to the brands they are buying, and will be extremely loyal when the brand vision resonates with them.”

Diversify your marketing efforts

While consumers come from a broad demographic, that variety doesn’t always make its way into companies’ advertising campaigns. Millennials are more inclusive and expect the world to be more inclusive of them, notes Barry.

Be aware of the diversity of images you share in ads and social media — and on your sales floor,” she urges. “Representation matters, and millennials want to see a wide variety of ethnicities, gender and sexual identities, ages, abilities and disabilities, cultural and family backgrounds, and even fashion styling. Your imagery should match your clientele, and your reach should be as broad as possible.”

Expanding your focus group is essential, adds Bishop, as therein lies the potential to drive tomorrow’s jewelry spending. “Consider the fact that your future target audience for diamond jewelry will expand beyond heterosexual couples, men seeking the perfect engagement ring, or the burgeoning number of self-purchasing women,” she says. “[Millennials] have the potential to spend not only on commitment and wedding rings, but on new occasions and relationships that jewelers might previously have never considered marketing for, like coming-out parties and Friendsmas.”

Cultivate open communication

The millennial consumer seeks community and a sense of belonging, and wants to connect with others more than ever, says Benjamin Smithee, CEO of retail consultancy The Smithee Group. Fostering an environment that lets these consumers receive and share information about your brand is imperative.

“Brands are a micro-community, [and] they must have a strategy for not only growing the community, but nurturing it,” he stresses. “That is more than an email newsletter and Instagram account. How are you creating opportunities for your fans to connect? How are you empowering your rockstar advocates to tell your story to others? And how are you listening to your community for feedback on how to evolve and grow over time?”

There are many ways to reach your consumers, says Barry, from phone calls to texts and social media. This generation has ever-increasing options of what to buy and where to buy it, so keeping in touch is more important than ever.

“Use social media as an engagement strategy, not simply to post photos of product and announce sales,” she says. “Respond to as many comments as possible, update regularly, and engage in storytelling. They are bombarded with ads on their social media feed. Stay top-of-mind by having memorable, engaging, purposeful posts with a true human connection.”

Make your engagement personal

Don’t just blast your customers with your business, make it theirs, too. Millennials want to engage and be part of your brand. They see it as more of a lifestyle than a business, and they want to feel like they matter.

“Send a message to important customers following a sale,” suggests Cutler. “Ask them for photos of your jewelry being worn, so you can feature them in both your social media and your email newsletter. This will continue to create loyalty and visibility for your brand while creating an affinity for your customer and their friends.”

Making your marketing personal automatically makes your customers part of your brand, Barry affirms. She believes the more you include customers in your business, the more faithful they’ll be when it comes time to make another purchase or suggest a jeweler to a friend. “[Post] stories and photos of couples who have purchased from you, employees sharing their favorite pieces with personal stories, [customers’] engagement photos with your rings, custom items shown with the story of the design process,” she recommends. “All of those make your store a part of people’s lives, not just a place to buy jewelry.”

Accept them on equal footing

Millennials are one of the most educated generations and have a penchant for researching and planning most major purchases. While a jeweler’s job is to be an expert and to impart knowledge, doing so in a controlling fashion can alienate customers.

“While it’s important to present yourself as an expert, be cautious not to talk down to a millennial,” warns Barry. “They are confident and prefer to be involved and treated as equals. Share your knowledge, but also take time to ask for their opinions and input.”

Retailers should be casual and friendly, ask great questions, and be prepared with an answer when asked, agrees Cutler. “They’ve most likely done their research online, so they arrive armed with tons of information. This may tempt you to take back authority and position yourself as the more knowledgeable expert, but don’t fall into this trap. You run the risk of the millennial interpreting your knowledge as condescending.”

Go old-school – with a twist

Merging a traditional sales approach with a new attitude is a great way to hook millennial consumers, says Bishop, who is also deputy foresight editor at trend consultancy The Future Laboratory. She suggests hosting focus groups to better understand what motivates these buyers, from the types of occasions they see as important, to what visual and design cues stimulate them.

One classic tactic that’s come back into style is keeping notes to make sure your clients don’t forget an occasion, says Cutler. “Start collecting names and dates [of partners and friends] and reach out to customers six weeks ahead of these important dates.”

That said, retailers need to understand that with millennials, not every experience or conversation needs to lead to a sale — for now. Instead, stores should work on building bonds and creating a feel-good environment centered around their brands.

“The problem millennials have with most experiences is that right at the end of a potentially amazing experience is a forced sales attempt that sours the taste,” explains Smithee. “Brands shouldn’t worry about immediate return on investment. Instead, they should focus on creating the most value for the customer. That’s what will inspire them to return.”

The shopper’s perspectiveTeaming up
Collaborations are among the key trends of today’s luxury market, according to an April 2019 study by Boston Consulting Group and Altagamma. Some 60% of millennials have purchased “special edition” products that were partnerships between different brands and artists, the survey found.

Count the goods
The average luxury consumer in the millennial and Generation Z age bracket (16 to 34) owns nine luxury fashion items from the accessories, apparel and footwear categories, according to a report by NPD Group and Stylitics.

The genuine article
Unlike previous generations, most millennials don’t buy luxury because of its exclusivity. In fact, only 6% of millennials and Gen Z-ers surveyed by luxury fashion site Highsnobiety purchased high-end goods out of a desire to express wealth, and 85% believed in the brand’s ideals and authenticity. In addition, only about half of respondents thought the luxury item they’d bought was of better quality than affordable alternatives.

Repeat performance
When it comes to purchasing high-end products regularly, millennials take the top spot, with 25- to 34-year-olds comprising 34% of repeat luxury sales, according to a survey by Global Web Index. Men in particular tend to be repeat buyers, making up 67% of shoppers in that category.

For what it’s worth
Approximately 50% of millennial consumers consider the long-term resale value of a luxury item when purchasing it, reported Boston Consulting Group and Altagamma.

This article was first published in the January issue of Rapaport Magazine.

Image: Shutterstock
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Tags: Benjamin Smithee, Karen Barry, Kathleen Cutler, Kathryn Bishop, Leah Meirovich, marketing to millennials, Millennial consumers, Rapaport News, The Friedman Group, The Smithee Group, WJN, Women’s Jewellery Network
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