Luxury Brands Need To Rethink Their Long-Term Cultural Impact. Here’s Why.


Limei Hoang | February 23, 2023

The Nike x Tiffany & Co. Air Force 1 1837 collaboration.Credit: Courtesy.

Is it a foundation, a partnership, a sponsorship of some kind? Whatever the endeavour to insert yourself into new conversations with customers, brands must rethink how they embed themselves on a deeper cultural level to ensure they stay relevant, not just for today, but for the years ahead.

If the start of the year was anything to go by, it’s that culture matters. So when the first pictures of Tiffany x Nike’s collaboration leaked on social media in early February, the response from the niche audience in which they wished to target, wasn’t quite what the two megabrands had anticipated.

Fans took to the comments section to voice their opinions on how the Nike x Tiffany & Co. Air Force 1 1837 collaboration, particularly the shoes which featured a Tiffany blue swoosh on the all-black suede leather, did not live up to their expectations. The hotly anticipated partnership demonstrated that whilst it is important to insert yourself into new conversations to attract new customers, it is even more important to get it right.

But when getting it right means having to understand a multitude of different things, including fast-changing customer expectations, a deeper understanding of how to react to market trends as well as designing and delivering products that resonate with on a more meaningful level with clients, it’s no surprise that many brands fail to match up with the mammoth task they are faced with.

“Luxury brands must deliver superb products and be culturally relevant. And frankly, this is something that was always true and will continue to remain true,” said Hana Ben Shabat, Founder of Gen Z Planet, a research and advisory firm, and the author of the book Gen Z 360.

“What is different is “the speed of culture” – a much faster shift in trends and in what is important, which means that customer expectations are changing fast too,” she added. “And therefore, the ability to keep a finger on the pulse and make constant decisions about which cultural trends you want to be part of is becoming a challenge to many brands.”

Take a Position

Another point for brands to consider about long-term cultural impact is how they take a stance in the values that consumers care about, as luxury becomes less focused around what kind of products you sell and more about what kind of universe you’re creating and what lasting impression you want to leave with clients. It’s one thing to post about something on social media, but it is quite another to commit yourself in a permanent way to a culture and the conversation around it.

“The biggest change we are seeing is shift in values. Consumers care about equality, sustainability, diversity and inclusion, and they want brands to reflect these values in what they do, be it the product itself or in their adverting and communication,” said Ben Shabat.

“Moreover, consumers, especially Gen Z and young Millennials, are making purchase decisions based on these values which is why it is critical for brands to understand the cultural moment and react to it,” she noted. “Social media allows brands to react to cultural trends and events in real-time. The ability to do so and be part of the conversation are critical in building cultural relevance.”

“Brands build cultural relevance by either taking positions on key issues, by collaborating with cultural icons and influencers, by promoting causes they and their customer believe in,” she continued. “Whatever brands chose to do to remain relevant must be authentic, real, and backed up with real action and impact. Gen Z has a very developed B.S. meter and they can assess quickly if a brand is authentic in their words and actions.”

Take Louis Vuitton or Prada, both of whom have committed themselves to establish their own cultural institutions. Prada says its permanent cultural complex in Milan is dedicated to the exploration of ideas, expressed through cultural products and specific disciplines like literature, music, cinema, philosophy, art, and science. Louis Vuitton's foundation in Paris, which this year will celebrate its 9th anniversary, was set up to make art and culture accessible to all, focusing on modern and contemporary art, as well as concerts, performances, screenings, and dance.

Or Kering, which set up its foundation to combat violence against women in 2008. The luxury group says it works with partners to help implement critical programmes aimed at creating meaningful change. Each of these examples demonstrates the long-term commitment that brands must take to deliver on what they say they want to be a part of.

The Louis Vuitton Fondation in Paris.Credit: Courtesy.

Everything to Everyone?

For Stéphane Girod, Professor of Strategy and Organizational Innovation at IMD, he believes the most critical challenge for luxury brands is the fragmentation of customer expectations and customer segments.

“The minute that brands are trying to be culturally relevant for one sub-group, they then become irrelevant for another. This is going to be increasingly difficult to manage because luxury brands come from a universe where it used to be one global brand approach,” he said.

“And if you want to be culturally relevant, you really have to be targeting and adapting what cultural relevance means for different subgroups,” he noted. “But it's impossible to differentiate actual product creation with cultures, which is correlated to customer segmentation. And the real question is, can a brand be everything for everyone? The answer is no.”

Which brings us to the importance of why. Over the past few years, we have seen plenty of efforts by luxury brands to engage new consumers. Gucciaga, Fendace are just two examples of some that we have seen over the years. But beyond generating a lot of buzz on social media, most brands often don’t think about the long-term cultural impact that they have. It’s not enough just to get people talking anymore, but instead trying to make a meaningful difference in what you do choose to put your efforts behind and making more of a lasting impression.

“When you have to be part of the culture, it means a conversation with consumers and a level of openness, accessibility, and understanding that your consumers have a role in defining your brand and that ‘brand control’ is to an extent irrelevant,” said Ben Shabat.

“Does this mean that you let go of your product standards? Absolutely not!” she added. “But it does mean that customer acquisition and retention are taking over the centre stage instead of simply marketing great products.”

Which is why culture matters so much. And whilst entering into a collaboration may help insert yourself into a conversation, what brands need to really think about is how they stay relevant in the much longer term, beyond just the moment.

For Longchamp, the French accessories and leather goods maker, its objective is to champion creativity through the partnerships that it embarks on. “It’s quite natural for us to partner with a design institution,” said Jean Cassegrain, CEO of Longchamp at the unveiling of its latest collaboration with Lausanne’s Museum of Contemporary Design and Applied Arts (MUDAC).

“There is a proximity of what we are doing as a designer and manufacturer, with designers in other areas. Even though the materials we use are not the same, it’s the same idea to create objects that are beautiful but also have a function and that need to work and that need to serve a purpose,” he added.

With each partnership, Longchamp has embarked on around 30 collaborations with artists, designers, painters and stylists so far including institutions like the Design Museum in London, the Centre Pompidou Centre as well as the Louvre in Paris, Cassegrain hopes to keep the conversation around creativity circulating as well as showing the public a different side to the brand.

“For us, I think what we're trying to do is make the public understand and explain to them, who we are and what we stand for,” said Cassegrain. “We have many ways to express our personality, so it could be through our website, or through our communications channels, or through partnerships.”

“We're quite open, and we are looking at opportunities and why not? he added, describing the process as very organic rather than strategic. “It's more meeting people and encounters and being available for opportunities.”

Hermès Winter 2022-23 campaign.Credit: Courtesy.

More Complex Strategies

Beyond their values, cultural relevance can be formed through your own brand’s DNA but as always, companies need to connect the dots in their storytelling to ensure that is the case. What is it that they stand for, what is it that their brand and products represent? Can those factors speak to multiple audiences in different ways, or do you have to set up micro segmentations for those different customers?

The answer is, it depends. For bigger brands, they have the financial means to play in multiple segments, as well as tailor customer engagement in stores, fashion shows, product collections and marketing communications in order to stay relevant to multiple customer segments, said Girod.

“Yes, it's a more complex strategy, because for the big industry leaders, it is dangerous for them to abandon one segment at the expense of another,” he said. “But another approach is when brands have a better anchoring around their cultural heritage and pay on how this heritage resonates across different cultural subgroups.”

“Brands like Chanel and Hermès don’t pretend they are going to cater for multiple types of cultures, but they do appeal to people are interested in the cultural relevance of the artisanal, unique, savoir-faire of the French ateliers because the moment you start playing in different customer groups, then you have to accommodate different collections, different marketing, and different products to those customers subgroups which is very complex,” he added.

Whatever the approach, one thing is clear. Brands must be clear on what strategically makes sense for them, otherwise any efforts are just wasted.

“Brands need to think about what cultural backgrounds are their customers are from and whether they aspire to play in one of the customer niches. Or are they a global leading brand, in which case they are dealing de facto with multiple customer cultures,” said Girod.

“And then you have a choice, either you continue to play on your cultural heritage and propose to your clients something that resonates to them across cultures,” he continued. “Or you will break it down more specifically to cater for different cultural needs, which is a more complex strategy to carry through. But if you do it well, perhaps it's possible.”

Consumers | Culture | Luxury