The Evolution of Luxury: How Gen Z and Gen Alpha Are Redefining the Market

Gen Z and Gen Alpha hold the reins of the evolving world of luxury. With shifts in spending power and influence through social media, the face of luxury has changed drastically, forcing brands to rethink their marketing and sales strategies. Here’s how the Gen Zs and Gen Alphas are influencing luxury trends.

The Sustainability Shift:A First Insight report states that 62% of Gen Z shoppers prefer to buy from sustainable brands, and another 72% agreed they would pay higher prices for sustainable products.
How did brands respond to this? : Brands like Gucci and Stella McCartney have introduced sustainable fashion lines, with Gucci’s ‘Equilibrium’ initiative focusing on responsible sourcing and reducing environmental impact.
The Power of Social Media and Digital Platforms: A Bazaarvoice study indicated that 73% of Gen Zs made their first purchase online. Gen Zs are swaying towards online sources for brand discovery and engagement, and although Gen Alphas don’t have the purchasing power yet, a study by McCrindle cited by Harvard Business Review, that over $5.39 trillion will be spent on Gen Alphas by the end of 2024.
How are brands leveraging this power? Luxury brands are connecting with younger audiences using Instagram, TikTok, and YouTube. For instance, Balenciaga’s TikTok campaigns got millions of views, translating into brand engagement and sales.
Luxury: Choosing Experience Over Possession: BigCommerce cites that 78% of Gen Z prefer spending money on experience versus buying something tangible. They look forward to an immersive, in-person experience, meaning in-store purchases are not entirely out of the window.
How are brands catering to this?High-end brands like Louis Vuitton and Burberry have launched pop-up experiences and immersive retail environments, blending art, fashion, and culture to attract younger consumers.
Personalization Is KeyGen Z and Gen Alpha are the digital generations–where algorithms curate personalized experiences and products. A WP Engine report states that 41% of Gen Zs will move away from the brand’s website if they cannot predict their likes, needs, or wants.
How are brands using personalization?Brands like Cartier and Hermes offer customization options, allowing customers to tailor products to their tastes enhancing the luxury experience.
To stay ahead of the curve and keep up with what Gen Z and Gen Alpha want, brands must be quick, creative, and always ready to innovate. If you’re curious about Gen Z and Gen Alpha’s shifting luxury consumption trends, the Cartier Corporate Internship Project offers a unique opportunity for high school students to gain insights into the future of luxury and work on presentations for Cartier under the guidance of Harvard student mentors.