The luxury industry is going through one of the most tumultuous demographic transitions. Economic trends are rapidly changing, digital transformation is rampant across the globe and businesses, and customer habits are evolving fast. The traditional strategies of the luxury brands are no longer enough to entice the new demographic – millennials. Selling a dream that represents a certain lifestyle meanwhile neglecting the power of digital media are no longer the keys to leading a successful luxury brand. Marketing to millennials is an art in itself. Being digital natives at heart, the new idea of luxury is not affluence or possessions but with individuality, self-expression, new experiences, and technology that aids this new craving. Millennials are not just passive consumers, they are curators and creators who appreciate individuality and personalization. Luxury brands have struggled to achieve this and since then are losing out to other brands who are able to communicate their messaging better.
In this regard, many entrepreneurs have risen to the challenge with their startups bringing fresh ideas and innovations. So here is the list of the most interesting startups that are on a mission to change the luxury industry as we know it:
Can’t find what’s trending? Need the latest designs? Winner of the LVMH Innovation Award 2017 and the « Best AI Solution » at ReMode 2018, Heuritech solves this with the world’s first artificial intelligence (AI) platform that uses advanced artificial intelligence (AI) to translate real-world images shared on social media into meaningful insights. The startup provides an AI-powered virtual assistant capable of spotting the latest fashion trends. A great solution for customers, at the same time, it empowers brands to forecast demand and trends more accurately, produce more sustainably, and achieve unprecedented competitive advantage.
(Image Source – Fashwell)
Finding the perfect dress can be troublesome. But Fashwell can help you find something similar. Considered as one of the best startups from The New York Fashion Tech Lab 2018 (NYFTL), Fashwell bridges the gap between social media inspiration and the retail experience. With its technology, The Zurich-based startup takes visual search a full step further for e-commerce retailers. Its search-via-image technology allows shoppers to upload images or screenshots and instantly receive similar product recommendations. Retailers love it too as it helps retailers manage inventory better, improve their product line up and suggestions that lead to increased sales and reduced overheads.
(Image Source – Lyst)
Offering a true omnichannel experience, Lyst is an e-commerce platform that is changing the way consumers shop. The site’s e-commerce platform aggregates products from over 10000 premium and luxury e-commerce sites. It also personalizes the consumers’ feed and offers a universal shopping cart. However, the best feature is for in-store shoppers. The platform gives instant notifications and special alerts to In-store shoppers when they walk close to items that are offering a great deal. Sales have tripled over the last 12 months and the startup has also raised another $40 million proving that there is a clear demand for such a service.
Messaging apps are a necessity. One can simply not imagine a world without one. But what if you could combine the power of a messaging app with e-commerce. Threads aims to make shopping for luxury fashion convenient, fast and personal. The London based startup, Threads courts high-end, millennial customers with tailored selections of luxury fashion, which the brand sells via messaging apps such as WeChat, WhatsApp, Snapchat, Instagram and Apple’s iMessage. All primary interactions between the brand and its customers are done via a team of human beings as shopping assistants adding that touch of elegance. The brand so far has stayed away from using AI-based shopping assistants primarily to ensure the entire process has a very personalized and human feeling. Threads has customers spread across 100 countries and are mostly millennials. With Asia being its strongest market, the brand claims to have an average ticket size of $3,000 per customer which in itself is proof of the viability in the business model.
(Image source – Stadium Goods)
$5000 Air Jordan Kicks? $1500 Yeezy’s? Millennials love sneakers and are ready to pay top dollar for the right sneakers. That’s a fact! So if you could create a platform that authenticates every single pair and ensures that every single sneaker sold on the platform is absolutely original, you have a winning Idea. And that exactly what Stadium Goods is all about. Original Sneakers, Loyal Fans! Founded by John McPheters and Jed Stiller in 2015, Stadium Goods has over the last 4 years made waves in the sneakers market. With highly selective partnerships and exclusive ‘drops’, a term used for highly anticipated sneaker launches, Stadium Goods has become a behemoth. Getting acquired by Farfetch in December 2018 for $250 million was just the validation the brand needed to prove that they are serious contenders fighting for their share in the $20 billion sneaker market.
With looks straight from the runway, Farfetch is an online luxury fashion retail platform sells high-fashion products from over 1000 boutiques and delivers in more than 200 countries. The reason for Farfetch’s success has been their intensive quality checks that ensure only verified luxury fashion products are sold on their platform. Customers can be assured that they get what they are paying for i.e. original luxury products delivered straight to their doorstep. With the recent IPO, Farfetch is currently valued at nearly $1 Billion which has allowed the brand to expand its reach to a larger consumer base to ensure they beat other giants such as Alibaba or Secco to become the world’s preferred luxury fashion retail platform.
(Image Source – Secret Escapes/Lexus Design Collection)
The current luxury market is being driven by millennials who crave new experiences. Secret Escapes is a highly exclusive members-only British travel club that offers its members huge discounts and great deals on hand-picked luxury hotels and holidays. With hotel and vacation partners spread across Europe, Africa, and the Americas, Secret Escapes is the perfect way to plan your luxury travel, stay at some of the top hotels in the world and vacation in the best locations. Currently, the service is available in Belgium, Denmark, France, Germany, Italy, Netherlands, Norway, Spain, Sweden, Switzerland, United Kingdom, and the United States. The brand’s latest partnership with Lexus allows members to book the Lexus Design Collection experience which is available in London and Edinburgh. A truly immersive luxury experience for design enthusiasts who appreciate good design and recognize the art and science behind it.
With changing trends, demographics, technology ecosystem, the Luxury industry needs innovation to keep driving sales, reduce their carbon footprint, manage global businesses better and overall continue to offer an exceptional shopping experience. Hennessy Cognac owner LVMH’s luxury innovation award is bringing entrepreneurship in the luxury industry leading to new innovations. In its 3rd year, the winner of the Innovation Award receives support from the company for one year. Recently, Louis Vuitton and Christian Dior also unveiled their new blockchain platform that would help the brand to verify original luxury goods. ConsenSys an Ethereum blockchain solutions startup has partnered with Louis Vuitton and Christian Dior to deploy the new platform ‘Aura’ which has been designed to cater to the entire luxury industry and offer powerful product tracking and tracing services in an effort to fight the war against counterfeits.