Luxury expert Daniel Langer looks at the challenges the luxury market is facing, from AI to a changing clientele
The luxury landscape in Asia-Pacific is undergoing a transformation, signifying a new era in consumer preferences and market dynamics. A notable trend is the rise of experiential luxury, particularly in the luxury food-service sector, which saw a growth rate of 51 per cent from 2021 to 2022, and the luxury hotel sector all across the region. Japan, for example, is set to experience a growth of 77 per cent in 2023, according to Euromonitor. This indicates a strong preference for luxury travel and accommodation experiences.
However, this growth brings a dilemma. While clients—who are willing to pay more out of pocket than ever before—expect incredible experiences, many brands fail to understand what the most discerning luxury clients really want. And with Gen Z flocking the most luxurious hotels, restaurants, malls, casinos, and entertainment venues, many brands are struggling to understand what the next generation in luxury is truly after. Also, many are surprised that the youngest clients tend to be the most discerning.
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In an industry where brand experience and emotional connection are crucial, the absence of tailored, high-quality training in luxury service and client engagement is a significant oversight. While luxury training is a pivotal lever for organisational change and a differentiator between successful and unsuccessful organisations, many luxury brands are not leveraging this opportunity strongly enough. The author of this column, who trains many of the world’s leading luxury brands on creating the experience of the future, today witnessed first hand how hard it is even for experienced client-facing staff to be able to provide an empathic and emotional experience to the most discerning clientele.
Consistently delivering luxury and creating an end-to-end experience for clients requires a combination of deep insights, skills, and executional excellence. The challenge is not only in creating a luxury experience but also in understanding the nuances of brand experience, developing empathy towards clients, and decoding their emotional triggers. This is especially challenging as sales ambassadors often don’t share the same lifestyle as their clients, making it harder to understand their needs and preferences without extensive training.