The world is experiencing a fragmentation of traditional structures that will eventually lead to new social, economic and political systems. The economic crisis of 2008, and the excruciatingly slow, incomplete recovery since, has opened the doors to a shift in expectations and attitudes. According to the consultancy Knight Frank’s “Annual Wealth Report 2016", the global population of ultra-high-networth individuals declined by 3% in 2015. More significantly, people are shifting their focus away from material prosperity to a broader vision of quality of life, balancing wealth with ideals of health, happiness and fulfilment. Millennials, growing up in the information economy fostered by mass media and the Internet, no longer have the same affinities for traditional luxury products and messages, nor do they relate to brand experiences and retail spaces in the same way.

The importance of this seismic shift cannot be overestimated. Luxury is at a crossroads. How brands react, and which new frontiers they choose to address, confront or adopt, will determine how they evolve. A love of luxury is no longer synonymous with extravagance but with quality, value, and creating art.

Buly 1803 is a French pharmacy dating back, naturally, to 1803. Its founder, Jean-Vincent Bully, inspired a character in the work of Honoré de Balzac. The focus at Buly is on natural ingredients, including nail varnish coloured with crushed shells, and water-based, alcohol- and glycerine-free perfumes. The packaging and retail space continue the narrative of a heritage brand by ingeniously recreating the environment of a 19th century pharmacy, with tall glass jars containing ingredients such as dried rose petals, handmade toothbrushes with silk bristles, and each purchase hand-labelled by sales staff. In an age of industrial production and seemingly identical retail experiences, craftsmanship has become a watchword among the 20-35 age group looking for quality products and unique design.

Millennials want bespoke retail experiences and a story to go with each handcrafted product. Clever brands will retain their commitment to their heritage by making their products and their stories relevant to the new generation.

This message has not been lost on brands that, over the last 15-20 years, have focused more on glamour or high-tech. The LVMH group began the programme “Les Journées Particulières" to showcase the diversity of its heritage, and know-how still in use today, from Dior’s haute-couture ateliers and Chaumet’s jewellery salons to the cellars of cognac house Hennessy. Alain Ducasse, a chef synonymous with French fine-dining, opened La Manufacture de Chocolat Alain Ducasse, the first bean-to-bar chocolate manufacturing facility in Paris, citing a desire to return to the love of a job well done and the relentless pursuit of being different. Even Apple, that temple of digital high- tech, felt the need to tie up with Hermès to bring the leather house’s artisanal know-how and human touch to the Apple Watch.

Hermès itself has created the label “petit h", reusing scraps of prime leather and other leftovers from its production runs in creative ways to fashion stunning new products. The nature of the materials available means that the making has to be artisanal, not mass-produced, with each design painstakingly thought out and adapted. The number of pieces is determined by the materials available. Thus, each piece carries a unique story and the mark of its creator’s hand.

Another frontier in luxury today is that of sustainability. Increasing awareness of the impact of our activities on the earth’s natural resources, on the climate and on human societies means that luxury purveyors as well as customers are investing in ethically sourced and environmentally responsible practices. If one considers the definition of luxury as related to know-how, heritage, rarity, respect for materials, human rights and quality, then we tackle the very fundamentals of sustainability. The mature luxury customer is certainly more discerning and demanding; s/he wants a more meaningful connection with the brand, over and above flashing status through product. But a large swathe of consumers, notably in emerging luxury markets, are not so concerned about this. This is where the true motivation and the true intent of the brands come in. Are brands doing this because it matters to them or because it is the buzzword of the moment?

The Kering group, a luxury goods conglomerate, has been moving towards a sustainable business model over the last several years, before it became fashionable to do so. For Kering chief executive officer and chairman François-Henri Pinault, it was clear that the push had to come from the brands, not the customers. Today, as the idea is gaining traction, Kering is in the position of a market leader.

Clever brands will retain their commitment to their heritage by making their products relevant to the new generation

Another example is Tiffany & Co., which has systematically opposed mining in sensitive natural reserves, although this would seem to be antithetical to its business interests. But it is actions such as these, which go beyond what is mandated by law or demanded by customers, that show the true motivation of brands. When luxury brands are inspired to act according to their values, and not just for opportunistic reasons, they inspire customers and lead them to higher standards of purchase behaviour, rather than scrambling to keep up with demand.

So does the embracing of these new frontiers guarantee success for a brand aspiring to luxury?

The machinery that has grown around today’s luxury brands may be coldly calculated finance, merchandising and marketing. But desire does not follow algorithms or come from the opinions of focus groups. They can only give us feedback on what exists, whereas luxury is in the business of constructing ideals. In a sense, this is the true rarity of luxury. Not just rare in its quantity, but rare within the range of our experiences. To consistently provide this rarity takes ingenuity and a vision.

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