3 ways fashion brands can polish their luxury advertising strategies to connect with consumers

September 14, 2022 | By Irene Oh, Sr. Content Marketing Manager, Fashion

Luxury icon

The luxury fashion industry is expected to transform in the near future, and brands may need to get creative with their strategies to reach customers. The US luxury market segment is expected to see slower growth in the next few years compared to previous years. According to Statista’s Consumer Market Outlook, the US luxury market segment experienced a 6.3% growth from 2018 to 2019, and is now expected to grow at 3.4% CAGR (compound annual growth rate) from 2021 to 2025—this is inclusive of luxury fashion, shoes, leather goods, watches, jewelry, and beauty.1

Keeping this forecast in mind, it’s an important time for brands to understand evolving customer needs. Based on findings sourced from a custom US luxury consumer survey conducted in April 2022 by Vogue Business with Amazon Ads, we’ve laid out three surprising discoveries about luxury shoppers to help brands develop strategies to drive growth during this slower period.

1. Shoppers from all income levels purchase luxury items.

Shoppers with $150K+ household incomes (HHI) are not the primary consumers of luxury goods (luxury fashion items priced over $500). In fact, 84% of luxury shoppers surveyed have an annual HHI under $150K. In addition to being the majority of luxury item buyers, <$150K HHI consumers also like to purchase often: Respondents with <$150K HHI made up 58% of high-volume luxury shoppers—meaning these consumers purchased at least five luxury fashion items in the past year. Additionally, <$150K HHI consumers were more likely than $150K+ HHI consumers to purchase luxury gifts closer to a holiday or event. But holidays and events aren’t the only reason why consumers buy luxury items: 41% of shoppers with <$150K HHI and 51% of $150K+ HHI consumers say they are likely to make a luxury purchase when they want to reward or treat themselves.2

It’s also important that luxury fashion brands understand how consumers are making their purchases: 81% of shoppers in both the <$150K HHI and $150K+ HHI groups have reported that they stream TV at least once a week or more. Diving deeper, among <$150K HHI consumers, streaming TV ads were 1.1x more likely to help them discover a new luxury brand or product than total luxury shoppers.3 This group is highly engaged with streaming TV and are using it as an inspiration point to help them across their buying journeys.

What we recommend:

Focus on an inclusive marketing strategy to reach audiences across income ranges and drive discovery. Advertisers can expand their reach strategies to include both <$150K HHI and $150K+ HHI audiences. For example, since <$150K HHI consumers report purchasing often, consider featuring complementary products from the latest releases. Additionally, it may be wise to time brand experiences closer to a holiday, which highlights relevant messaging like, “Show your loved one how special they are this holiday season.” However, don’t feel limited to just the holidays—include year-round messaging that focuses on self-gifting to inspire action in addition to big holiday pushes. Consider displaying messaging on streaming TV (e.g., Fire TV, Amazon Freevee) to drive discovery for brands, since <$150K HHI consumers are highly engaged with this digital channel.

2. Millennial men like to spend more than average luxury shoppers.

According to our survey, millennial men (25–44) make up 65% of male shoppers, so advertisers have a sizable opportunity to help drive discovery for their luxury brands among this group. Millennial men are 1.5x more likely to spend over $5,000 on a luxury fashion purchase compared to total luxury shoppers. The majority (60%) of millennial men surveyed have made between one and four luxury purchases in the past year, and are also 1.3x more likely to make a luxury purchase to get in on a new trend4 —suggesting that they like to stay on top of the latest fashion moments and purchase seasonally.

It’s also important for brands to understand the best moments to meet these millennial male shoppers where it matters the most. The majority (84%) of millennial male shoppers surveyed watch content through streaming services and are more likely to engage with digital touchpoints throughout their shopping journeys. Millennial men are also 1.3x more likely for their purchases to be informed by advertising seen on streaming TV services, compared to luxury shoppers overall. In addition to streaming TV, millennial men are 1.7x more likely to engage at least once a week on Twitch.5 This suggests that Twitch can be a good place for luxury brands to connect with millennial male luxury shoppers.

What we recommend:

When engaging with millennial men, timing is important—consider engaging this group ahead of a seasonal collection or exclusive launch to create buzz and excitement. It might also be beneficial to provide special sneak previews for new items before they’re available to cultivate interest. Since millennial men are highly engaged with streaming TV and Twitch, advertisers can leverage these channels to drive brand discovery and connect with audiences where they organically congregate (e.g., Freevee, Fire TV, Twitch).

3. The #1 luxury gift-giving occasion is…

Birthdays. While Christmas is widely regarded as one of the busiest gifting holidays of the year, the majority of luxury consumers surveyed state that birthdays (95%) are the top gifting occasion6 (Christmas is a close second). Considering the gifting cycle for birthdays is year-round, we recommend brands have an always-on strategy to connect with audiences when they may be shopping for birthday gifts. A third of luxury shoppers (33%) surveyed also reported that they begin shopping for gifts two to three months in advance of an occasion (e.g., Mother’s Day, weddings).7

What we recommend:

Advertisers have multiple opportunities to engage with audiences beyond the holidays. Consider implementing always-on strategies to stay top of mind with luxury gift shoppers. For key gifting holidays, we recommend advertisers start engagement strategies two to three months in advance. In addition to this timing strategy, consider including payment plans or special offers for shoppers who purchase in advance.

Luxury brands who are attuned to audiences’ digital preferences and shopping habits may be better equipped to effectively service shoppers interested in purchasing luxury goods. Understanding the nuances and differences among income groups, the shopping preferences of millennial men, and even purchase timing can be the difference between a strategically-approached opportunity and a missed one.

Want to turn these luxury fashion insights into action? Contact us or visit our fashion industry page.

1 Statista Consumer Market Outlook, August 2021, US
2 - 7 Vogue Business and Amazon Ads custom survey, April 2022, US