How do you segment luxury consumers based on their values and motivations?

Segmenting luxury consumers means dividing them into different groups based on what they value and why they buy luxury things. For example, some people might value showing off their status, while others care more about the environment. To do this, you can ask questions, look at what they buy, and study how they act. Then, you create special messages and products for each group that match what they care about. This helps luxury brands sell better and make customers happier.

Here are two key segments of luxury consumers: Hedonists: These consumers are driven by the pleasure and emotional satisfaction associated with owning and using luxury goods. They value the feeling of indulgence, exclusivity, and the status that comes with certain brands. High-quality materials, craftsmanship, and beautiful design are all important factors for hedonistic luxury consumers. Utilitarians: In contrast, utilitarian luxury consumers focus on the functional benefits and quality that luxury goods offer. They appreciate the investment value of luxury items, believing they are built to last and perform exceptionally well. Durability, functionality, and heritage are often more important than flashy brand names for this segment.

In my experience, the hedonic luxury consumer is also often motivated by the desire for exclusivity and the ability to express their individuality through a personalized experience.

We believe that luxury consumers are not just buying a product, but they are buying into a lifestyle and a set of values. Therefore, we approach luxury consumer segmentation by identifying their values and motivations that drive their purchasing decisions. Our approach to segmentation is centered around understanding the diversity of our global clientele, while celebrating their shared passion for creativity, craftsmanship, and quality. We utilize a mix of demographic, psychographic, and behavioral data to segment our luxury consumers. At DAVANI, we aim to create a personalized and immersive luxury experience for our customers, regardless of their segment.

The extrinsic behavior is more often found in affluent consumers, who want to somehow "prove" their success through the ownership of a certain product, or more specifically, certain attributes that are only found in a certain category of products. These products often use shiny materials and bright colors, aiming to be different and stand out. The tricky part of trying to get their loyalty is finding stability through unstable designs, looking for design elements that will serve as a fingerprint of the brand. In the luxury watch industry, brands like Audemars Piguet and Rolex have iconic designs, but lean a lot more toward an intrinsic approach. On the other hand, Jacob & Co. and Hublot try to constantly push boundaries.

These two groups demand two different marketing approaches: Self-directed consumers want the most amount of information possible before making a purchase decision. For this reason, brands need to create detailed product pages on their websites, develop rich social media posts, most of the time narrated and/or conducted by an expert, and of course, understand that these people will take a few months to buy. On the other hand, other-directed people respond better to influencer partnerships and social proof.

Self-directed luxury consumers make purchasing decisions based on their own preferences, interests, and lifestyle choices. They value individuality, personal expression, and a sense of uniqueness. Other-directed luxury consumers are influenced by social cues, brand reputation, and the opinions of others. They seek to conform to social norms and gain admiration from their peers. Practical Example: A self-directed consumer might seek out less mainstream luxury brands that align with their personal taste and style. An other-directed consumer might prioritize brands with high visibility and celebrity endorsements to enhance their social standing.

The distinction between self-directed and other-directed consumers is seen in other fields, including education and learning, reminding me of concepts found in MBTI research. For example, self-directed learners may align with MBTI’s Introverted or Thinking types, relying on personal judgment, while other-directed learners might resemble Extraverted or Feeling types, seeking external validation or collaboration. Considering vowing this through the lens of could assist with a tailored approache by offering independent research opportunities for some and collaborative, guided learning experiences for others.

Traditional luxury consumers often come from established wealth and prioritize heritage, legacy, and timeless design. Discreet brand logos and classic styles are valued, with an emphasis on quality materials and craftsmanship passed down through generations. In contrast, modern luxury consumers embrace innovation and personalization. They seek unique experiences and may be drawn to disruptive brands that challenge the status quo. Sustainability, ethical sourcing, and social responsibility are often important considerations for this forward-thinking segment.

It is almost natural to say that traditional luxury consumers are most often, older folks. They have had enough time to study brands and eventually make a choice to be loyal to the one they find most appealing. Conversely, the younger folks are just starting out life and so want to explore before getting stuck with a brand in the name of loyalty. It seems most luxury consumers would experience both as they live long enough in life.

Traditional luxury consumers value heritage, craftsmanship, and classic designs. They prefer established brands with a long history and a commitment to tradition. Modern luxury consumers embrace innovation, experimentation, and unique designs. They seek brands that push the boundaries of luxury and reflect contemporary trends. Practical Example: A traditional luxury consumer might appreciate a vintage Rolex watch for its timeless elegance and craftsmanship. A modern luxury consumer might admire a futuristic-design handbag from a cutting-edge brand that reflects their forward-thinking lifestyle.

La segmentation des clients doit prendre en compte la typologie des consommateurs de luxe divisé en 4 catégories selon leur attrait Marque Vs Produit : et donc une sous- segmentation de ces catégories précités Les CONNAISSEURS: cherchent le savoir faire traditionnel et échangent avec la marque. Les AMATEURS: sont plus attirés par les produits ? complémentaires ? et accessibles , les parfums, Beauté… Les OCCASIONNELS: attirés par les tendances et influen?ables Les LOGOPHILES: Moins attirés par l’artisanat et la créativité et plus enclins aux produits logotypés!

Don't forget the desire for exclusivity, quality, brand prestige, and personal expression. Also use data from surveys, purchase history, and social media to tailor and optimise the marketing strategies.

Brand loyalty: Some luxury consumers form strong brand loyalty based on personal experiences, consistent quality, and emotional connection. Practical Example: A luxury consumer who has had positive experiences with a particular brand is likely to continue purchasing from them, even if other brands offer similar products at lower prices.