New Era Luxury

Crowd DNA senior trends consultant, Rebecca Coleman, shares some notes from Shoreditch House's recent Rising Minds' New Era Luxury briefing...

The luxury labels succeeding in today’s crowded marketplace are those that think of their customers as fans, providing a brand encounter that parallels membership of an exclusive club. From ritualising the shopper journey to co-creation and ultra limited product runs, luxury is entering an age where access and experience trump pure acquisition and display.

These were some key insights touched upon by Katie Baron, head of retail at innovation advisory firm Stylus, during a talk entitled New Era Luxury at Shoreditch House. Part of the Rising Minds series of inspirational talks, the session focused on examples from major players getting it right in the world of high-end retail and branding.

Here’s a rundown of the top takeaways:

“Fans before consumers, interests over age”

Katie echoed sentiments from Crowd DNA’s 2015 trend Flat Society Consumerism by saying that now, more than ever, demographics play a limited role in assessing consumer needs and desires. The rise of social media and increasingly connected lives, as well as aging populations and healthier lifestyles, has made traditional models of grouping people by life stage, income or location much less relevant. Instead the luxury brands that are winning are the ones thinking about their customers as fan tribes, united by interests, attitude and behaviour.

She cited Dunhill’s houses (in various locations across the world) as an example. These “stores” encompass a holistic lifestyle offer with humidors, bars and barbers sitting alongside more conventional fashion retail space.

“Co-creation is essential”

Brand Me is a much discussed trend – especially in relation (though not limited) to the youth market – as a generation grows up increasingly selfie-obsessed. One could argue that this trend towards narcissism is nowhere more applicable than in the realm of the luxury brand.

For this reason, retail experiences that invite co-creation and customisation are ever more popular. High levels of personalisation also increase shareability of products and thus heighten brand awareness. Anya Hindmarch’s bespoke handbag monogramming service was mentioned as an example here, as was her 2014 campaign, pictured in our header image, in which she enabled consumers to virtually customise accessories with emoji-emblazoned leather “stickers” online.

“Build anticipation and use delay to inject desire”

In our modern world of instant gratification, delayed, staggered or fleeting experiences are prized. Luxury brands are using these tactics to heighten consumer lust. Katie’s top example here was Belgian fashion designer Raf Simons’ 2014 collaboration with US artist Sterling Ruby. Their collection was sold via a dedicated online portal, which stocked just one outfit per week, creating buzz and frenzied buying with each new release.

Into the future…

Katie also touched on more future facing concepts, forecasting how the luxury market might jump on burgeoning tech to enhance the customer journey in the next five to 30 years. Innovations in the area of haptics were highlighted – by allowing consumers to virtually touch fabrics, they have the potential to significantly shift the online shopping experience. For similar reasons, VR also featured as a powerful tool for altering the luxury retail landscape.

Revisit Flat Society Consumerism, among Crowd DNA’s other trends for 2015, here.

Droid Innovation

Robots, robots, robots. Crowd DNA innovation exec, Berny McManus, is becoming obsessed. This is work-related, though - robots, she says, can lead to exactly the kind of innovations that consumers crave...

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If I say the word “robot” to you, what sort of image pings across your mind? I’m guessing you picture something that looks like Brian from that ad for a brand that rhymes with Then again, if you’re anything like Steve Aoki, the word robot will have you dreaming of the day that you can become a robot yourself. And DJ in space.

Whatever your reaction, it’s undeniable that the idea of robots and how we can use them to enhance our lives is fascinating. Well, in the innovation team at Crowd DNA, we certainly think so!

Pole dancing robot
Pole dancing robot

Here’s a unique example that I stumbled across. Lexy and Tess are pole-dancing robots (ladybots – apologies girls), who have been developed by Tobit Software. Check out their YouTube debut here. Is this the first/last time you’ll read pole dancing + robots in the same sentence? Entertaining? A little bit weird?

Yes to all of the above. But innovative? No.

Unfortunately for Lexy and Tess, utility and output/impact are what turns a great idea into true innovation. Innovation solves a problem and makes a positive change. With that in mind, here’s an example that ticks both of those boxes.

I was pretty excited to read about adidas’ new plans that include (non pole-dancing) robots. adidas’ current CEO, Herbert Hainer, acknowledged that a 12-18 month production timeline just wasn’t good enough in a world where fast fashion is the norm. The new plan involves pulling back on production in Asia, slashing production time and… introducing in-store robots.

Adidas’ potential employment of robots mean that they will be able to meet consumers’ need of personalisation through customisation of their trainers, allowing for a more bespoke and current customer experience. According to Trendwatching, who list face-to-face robot interaction as a major trend in 2015, this dual outcome of speed plus customer experience is what we should be aiming for when making use of robots.

To me, Adidas’ new venture illustrates the importance of partnering innovative thinking within your business with consumer insights. Being reactive to market needs and being flexible in your thinking is one way that companies can remain highly competitive. I’m not saying that all innovation should include robots, but purpose, openness to ideas and targeted execution of solutions is what lies at the core of successful innovation.

Wearables + Youth

Aurelie Jamard, our associate director for innovation, explores how brands should embark on making wearables that Gens Y and Z actually want to, like, wear...

“Everybody does it…”

This is what Swatch’s CEO Nick Hayek said when he announced that the Swiss brand would be releasing an NFC-enabled watch this month. It’s true, everyone is doing it, but not yet for everyone. 

Last year saw an explosion of connected devices and accompanying apps, with established brands such as Samsung, Sony and Apple leading the way. However, as Alexandra Deschamps, designer and founder of designswarm, mentioned at the Dots conference last year, “ideas in the wearables space are going to market too fast.” Everybody jumped on the bandwagon, launching smart jewels like Ringly and Ear-o-Smart, or turning bracelets into an advertising gimmick for Nivea Sun. However, these products have failed to reach beyond journalists and early adopters, by and large.

Wearables and the next generation of wearers: Gens Y and Z

But what about the long-term strategy? It seems nobody is designing for the next generation of wearers: Gens Y and Z. And, to do that, brands need to understand their different expectations of technology. A recent “non-scientific survey” conducted by eBay Deals’ blog revealed that under half of male respondents aged 18-34 wear a wristwatch and only 23.7% wear one on a daily basis. It’s time to reconsider what wearable tech means for this generation. What do they expect of connected products they’re being asked to wear? How does it fit in with their perceptions of luxury, their love of the sharing economy, and how long do you even own one for? At this stage, the most critical question is why so many brands and start-ups jump are jumping on the bandwagon without considering these issues.

Accessibility, universality and relevance will attract tomorrow’s customers

Many brands are giving it a try: wearables on Android Wear, wearables on iOS, some all-encompassing (think iWatch and Samsung Gear), some very targeted (think Swatch Touch and FitBit), some fashion-led and some others modular. However, Gen Y and Z will need tailored solutions. Here’re three ideas to get you thinking:

Accessible yet unobtrusive – young customers will not part with hundreds of dollars, pounds or euros for a device that does approximately the same as another one they own, just in a different format (however if it does exactly the same and more, it might even replace the device). But they will welcome ways to interact with technology that feel less intrusive and more natural to them.

Universal and compatible – customers demand a universe where compatibility isn’t a problem. After all, what’s the point of owning an NFC-enabled watch that can open your hotel room door if only one hotel is offering the service?

Culturally relevant and personalised – Modularity is key. This is where initiatives such as Blocks and Google’s Project Ara are making a splash. However, the freedom of customisation must balance with simplicity. Choice overload often ends up in no choice at all.

While tech continues to develop (and might eventually cannibalise wearables), it’s down to individual brands to be selective and smart about what tech to adopt and adapt for which target audience. Young consumers are notoriously discerning, so it’s important that Swatch, Tag Heuer, Swarowski and other makers with wearable intentions keep up to date with and cater to their needs. Just because “everybody does it” doesn’t mean that everybody does it right.

Inspiring Innovation

Crowd DNA knowledge leader, Aurelie Jamard, and exec, Berny McManus, share notes from Time Out innovation director Eleanor Ford's Shoreditch House talk on the innovation spectrum – from collaboration to renovation to retrieval...

Innovation is a hot topic. It’s a forward thinking concept that generates excitement, energy and fresh perspectives. So the obvious question to ask at this point would be: if innovation is so hot, then why hasn’t every company adopted and integrated this concept into their business? The short answer: misconceptions exist around innovation.

Many companies see innovation as a radical, disruptive change that is near impossible to tackle, when it is actually about acknowledging your company’s strengths and adapting them to an evolving context. In a nutshell, improving on what you do best.

In a recent talk at Shoreditch House, Eleanor Ford (director of innovation at Time Out and founder of LikeCube) detailed how innovation should not be seen as a total departure from a company’s ethos. It’s about fostering a culture within a business to allow for adaption and malleability in product and service design. Innovation should not indicate a loss of identity for a company, but it will ensure that it stays culturally relevant and competitive within its market.

We’ve handpicked a few of our favourite ideas from Eleanor’s talk to inspire innovation within any company.

Technique #1 – Incubation

Time Out has a dating legacy (you might remember the days of dating ads in the print mag…), so it makes perfect sense for the brand to experiment in that space today. Except that replicating a winning formula from the past was never going to cut it. As Eleanor puts it, it’s important to retain the brand’s identity but to adapt it to a new context. So Time Out have been incubating a dating product that enables users to meet new people around their favourite occupations in their city, from swiping date ideas all the way to quickly meeting offline.

Technique #2 – Acquisition

Acquisition is another way for Eleanor to inspire innovation at Time Out. Absorbing other companies whose skills suit a particular niche in the market can only be beneficial to a big group like Time Out in bringing a breath of fresh air and specialism into the company. As a result, Time Out acquired a company to help them engage with customers directly via blogs and offer a platform for user-generated content that can be up-voted by users themselves, in the same way Reddit does, for instance.

Technique #3 – Adaptation

If you’ve travelled to Lisbon recently you might have stumbled across Time Out’s Mercado Da Ribeira, which is essentially a farmer’s market version of the magazine. You can find every section of the title represented through market stalls, shops and restaurants picked by Time Out critics, but also via a dedicated event space that hosts concerts and a club. For this new product, Time Out adapted their core values to a physical space in a different country, deciding to translate what they do best into a new context.

Time Out's Mercado Da Ribeira
Time Out's Mercado Da Ribeira

It’s great to see companies innovate both internally and externally, whether on a big scale or by dipping their toes in the water. If you don’t know where to start, why not give a try to one of the techniques above? And remember, innovation is not about ignoring the past, but about using it as a foundation to inspire something new.

Eleanor also referenced how Fiat kept the spirit of their Cinquecento car (beautiful design, small size, affordability) when they re-launched it in 2007. However, changes in proportions and disposable income meant that a literal translation of the old model would have not worked for the market today.

Beer Innovations In 2014

From new digital platforms to an ale that apparently helps you get fit, Crowd DNA's knowledge leader in innovation, Aurelie Jamard, cracks open a selection of new ideas in beer from 2014...

Yes, we’ve decided to talk about beer at a time when Coke is tentatively trying to launch lactose-free milk (not without a few hurdles…), and when everyone’s stocking up on mulled wine and bubbly for the festive season. But we’ve seen some interesting moves in the category this year and we’d like to review some trends that are influencing innovations and will undoubtedly keep doing so in 2015.

2014 was the year that really highlighted the decline of Millennials’ interest in beer to the advantage of wine and spirits (and, worse, healthy drinks!). This generation of consumers, better educated and more socially active than ever, turned to more sophisticated drinks but also demanded more transparency and authenticity from brands in the category. The trends and innovations below attempt to sum up some of the most significant changes that happened to the industry in the past months.

Crafty, authentic, local

Craft beers have of course been the massive hit of 2014. Consumers in search of authenticity, quality and locality have united to support small breweries and discover new draughts. Most recently, Diageo launched two new craft versions of its Guinness beer, and the BeerBods platform went live after reaching its Crowdcube goal of £155,000 in 36 hours. The aim of the platform? To enable its members to discover different craft beers at their leisure, for a quarterly fee of £36.

Women drinkers as the new target

2014 has been a year of strong female centric campaigns, such as Always’ #LikeAGirl and the UN’s Emma Watson-supported HeForShe initiative. And the link with beer? 2014 has seen SAB Miller pledge to change the image of beer by launching products designed to appeal to female drinkers. The popularity of new beer products across the category, such as Radlers and fruit ciders, is another manifestation of this trend and has helped foster a move towards less male dominated innovations.

New luxury for Millennials

In one of our Crowd DNA events this year we talked about new interpretations of luxury among youth. It’s a revised definition that spans across categories and has raised challenges in some quarters. But it’s definitely had an impact on the beer industry in 2014. Initiatives like House Of Peroni have contributed to raising the profile of the Italian premium beer among affluent, young UK consumers. Another interesting move came from MillerCoors: the company created a new beer with stronger alcohol content called Miller Fortune, designed to attract Millennials whose preference has been for spirits lately. With its biggest launch in six years, the brand also contributed to fuelling the new, fast growing and high margin “above premium” beer category.

So despite a growing trend for the consumption of healthy products, the beer industry is starting to adapt, which promises an exciting year of innovations ahead. But the focus on healthy drinks isn’t something that the category has to miss out on altogether. Canadian company VAMPT Brands recently launched its Lean Machine Ale – packed with antioxidants and electrolytes, making it the first fitness-enhancing beer, it’s ideal for bodies in recovery mode after a session at the gym.

And the other way round works, too. It looks like soft drinks are following in the footsteps of the beer industry, with Pepsi launching its ‘craft soda’ called Caleb’s Kola in some test states in the US. So what kind of innovations can we expect in the beer industry in 2015? Drop me a line if you want to find out more. Over a beer or otherwise, we’d love to discuss these with you.

Award Number Three For 2014

We started the year winning the Storytelling prize at the Marketing Week Data Strategy Awards. Then came the FIPP Gold Award for our Connected Consumers work for Time Inc. And, pleased to say, we've ended the year by winning the MRS Cultural Insights Award...

We picked up the Virginia Valentine Award For Cultural Insights, to give it its full title, in partnership with University Of Nottingham’s Students Union for our work re-imagining the iconic Portland Building. This saw us combining our ‘Crowd Out’ innovation approach with detailed cultural analysis, exploring what a campus space needs to offer for a next generation of students. Big well dones to all involved and thanks to University Of Nottingham’s Students Union for picking us for the project in the first place. Oh, and that’s the comedian Milton Jones on the left in the pic, by the way.

We've been looking at some examples of brand innovation that come culturally charged. The common thread? The component which makes the difference is very much at the heart of these companies, rather than a marketing bolt-on. And the innovation is crafted from real world sentiment, not just built from a digital breakthrough. All new-ish brands, here's their stories...

Finisterre: cold water surfing

Think surf culture and the bright colours and karma of Hawaii most likely come to mind, or the sun splashed ways of California. But Finisterre are reimagining the sport in the form of ‘cold water surfing’ – casting it as a culture that’s unique from that of the warm water variant, with a completely different set of rituals, behaviours and, naturally, product requirements. In a sphere as codified in deep-rooted imagery and customs as surfing, it’s quite a feat to have you reconsidering things.

Shinola: bringing manufacturing back to Detroit

Few cities have been through tougher times than Detroit – when the car industry and its wealth left town, poverty and a sense of abandonment set in. Shinola have built their watch business (closely followed by bicycles and other product lines) around reinvigorating the story of this American city and indeed of gutsy American industry. Thus the brand comes with a tangible spirit of striving heavily embedded in its DNA.

Story: if a store thought like a magazine

A store called Story ought to come with a good story of its own and it does. Situated on Manhattan’s 10th Avenue, this is a shop that thinks like a magazine, starting completely afresh every four to eight weeks and bringing together a new issue in which the product acts as content. Previous themes have included Wellness, Love and Made In America. This time it’s Home For The Holidays, an ‘editorialised gift guide’ shaped in partnership with Target.

From the incremental to the radical, the digitally focused to the resolutely physical, brands need to innovate around space to stay on top of their customers’ expectations, explains Crowd DNA innovation knowledge leader, Aurelie Jamard...

More than ever, retail environments are facing intense challenges due to the growing appeal and convenience of online shopping – and various brands are turning to new technologies to help re-invent their store experience. We’re also seeing interesting shifts from digital to physical, and virtual reality blurring the boundaries between online and offline. Time to explore this area in more detail.

Customer needs are converging

Hot from the press, we hear announcements that Amazon are planning to open physical pop up shops in the US, and John Lewis wanting to experiment with beacons and virtual reality in their UK stores. So what does this mean for the future of retail, and how do these announcements reflect customer needs (if at all)? Customers’ expectations are rapidly changing and strongly influenced by peers, brand experiences and the latest innovations that become accessible to them. Online shopping has grown in popularity, enabling young customers to snap the best deals and allowing parents to shop on their terms, any time, anywhere, and without the kids. On the other hand, shopping in store gives them what websites are still strongly lacking: a feel for the products and a true brand experience. But lack of time, greater choice and technological developments mean that customers have grown to expect a consistent and integrated shopping experience across channels.

Technology as an enabler

The explosion of technological innovations has broadened retailers’ options and created opportunities that would have been unimaginable a few years back, such as being virtually teleported from anywhere in the world to the top of London’s Tower 42, courtesy of Marriott, or visualising pieces of IKEA furniture in our own homes without lifting a finger off our smartphones. So from VR (Virtual Reality) to AR (Augmented Reality), Google Glass to Kinect, and beacons to drones, there is a plethora of options that are being developed and experimented with by brands to make their in-store experience more relevant and entertaining to shoppers. Some brands like Topshop have fully embraced these, and their latest endeavours include offering a virtual reality catwalk in their Oxford Circus store as part of this year’s London Fashion Week, as well as creating a Kinect-enabled AR mirror to re-create the illusion of a fitting room in one of their stores in Russia. Other brands that have embraced AR include Converse, De Beers, American Apparel and Sephora.

Experiences (are all that) matter

But retail experiences are not only the product of great technology put to good use. They can also harness the power of social and experimentation, as IKEA and AirBnB’s partnership in Australia shows, enabling visitors to book sleepovers (and try pieces of furniture at the same time) in IKEA stores overnight. Testing products in store is another way to provide added value to customers. In Germany, outdoor sports retailer Globetrotter boasts a four-storey shop including a pool, a cold room and a shower to enable customers to test the equipment and clothing before making a purchase decision.

So innovating with space around the needs of end users is crucial to any brand with a physical retail presence (and even without one as Amazon and Google rumours suggest…). It can include technology but doesn’t have to; it can be incremental or radically different; it can appeal to one or all of the senses; it can be about display, product experimentation or payment. But one thing is certain: it has to be shaped around customer needs and work with the brand’s vision, as our work with the likes of Topshop has proven.

At Crowd DNA we use various methodologies to uncover insights around end users, but also around space, starting with in-situ work and testing findings against our cultural strategy framework. If you want to know more and/or have a chat about the ever-changing retail landscape, drop me a line.