LIGHT AFTER THE LOCKDOWN: THE NEW DEFINITION OF LUXURY
HOW AUTOMAKERS CHANGE TO CATER FOR THE NEW LUXURY MINDSET
Fasten your seatbelts, it’s going to be an exciting ride into a radically transformed luxury paradigm.
Even before the outbreak, it was clear that luxury consumers were changing for the good. Not only were we witnessing a shift away from inherited wealth to self-made fortune, but it was evident that the pool of consumers for luxury goods was also getting younger, more environmentally conscious, increasingly tech-savvy and no longer enamoured by accumulating wealth and possessions. With millennials and true digital natives (Gen Z) driving this trend, the implications for luxury spending are vast.
At one time, luxury was defined by excess and opulence. Think of the eye-catching Aston Martin Rapide whose massive engine exudes power and performance. While the focus is placed on high-speed thrills and exterior look, its CO2 emissions, plastic interior bits and outdated tech are at odds with the eco-friendly generation just coming into wealth.
Thus, broadly driven by environmental pressures and changing customer values, prominent luxury brands have started embracing sustainability into their narrative. The rise of all-electric cars is undoubtedly the biggest innovation disrupting the whole premium car industry.
While a number of automotive incumbents have tossed their hats into the electric car ring, Porsche’s CO2 neutral production of its all-electric sports vehicle Taycan stands out. Not only due to the boldness of dipping its toes in the electric car market when its luxury competitors Ferrari and Lamborghini shied away, but also due to its adamant commitment to renewable energy. After all, the Taycan’s launch in 2019 was held simultaneously at a Chinese wind farm, a German solar panel farm and in front of the spectacular Niagara Falls. And this appeals strongly to the new breed of luxury consumers who are determined to show loyalty to purpose-driven brands and boycott the ones that do not share their values. Porsche was ahead of the game and understood that a new age of luxury needs to be delivered to win over these fresh-faced customers.
More recently, luxury started being associated with a lifestyle of absence and minimalism, as opposed to a superficial expression of wealth and ostentatious logos. True luxury became subtle. Like a breath of fresh air. Or a discrete ray of the morning sun. The return to simplicity, to elegant lines, comfortable seats and plenty of space reveals a story about how the interior of the car has become just as crucial to one’s enjoyment as the power of the engine. This is why working with timeless designs, carefully curating interior details and choosing recycled and bio-based materials over carbon fibre or animal textiles strongly appeal to the new luxury car buyers. The need to go beyond climate-positive engine technology is clear — today, customers demand that every part of the vehicle should be responsibly sourced and kind to the planet.
Yet change has come in other ways, too. Instead of chasing iconic items, consumers are making a statement about how privileged they are by indulging in meaningful and exclusive experiences. Ones that are deeply personalised and cannot be easily replicated. Brands which step up to the challenge focus on celebrating uniqueness, ambition and the aspiration to stand out. Ultimately, it boils down to providing a platform for identity building and identity reinforcement. And once customers become emotionally invested, they are more likely to repeat their purchase and show some form of brand loyalty.
In the battle for affection, luxury car manufacturers have shown that creativity has no boundaries and that experimenting with different concepts pays off as long as the company stays true to its strong and unique DNA. Take Porsche for example. With a history dating back 70 years ago, the company managed to blend heritage with best-in-class technologies and made no compromise to high quality when integrating futuristic visions. Customisable cabin interiors, intuitive and intelligent controls, plant-based leather alternatives, eco-friendly reward programs, keyless unlocking of the vehicle but also AR head-up displays, simulation platforms that can better understand humans or VR edutainment are already part of Porsche’s innovative initiatives.
STARTUP AUTOBAHN powered by Plug and Play, Europe’s most successful innovation platform, has been working with Porsche for over three years to fuel the company’s progressive ambitions and encourage the adoption of cutting-edge technologies. Having collaborated with innovative startups from all over the world, Porsche has now accumulated enough weapons in its arsenal to win over the new luxury generation. However, the pursuit of novelty never stops at Porsche. This is why, on June 18th, Porsche x STARTUP AUTOBAHN deep dived into the most pressing challenges that are forcing the luxury industry to rewrite its rules and, together with 10 guest startups and the full support of the platform’s corporate partners, devised ways to adjust and respond to these threats.
Having recognised that the human element is irreplaceable regardless of the amount of technology or the number of digital channels used, Porsche is currently exploring new avenues to strengthen and engage its community. In a post-pandemic world where luxury sales are likely to dip in the near term and millennials and Gen Z in particular are demanding more open and honest communication, commitment to customer centricity will be paramount. Authentic brand values that reflect the customer’s mindset will increase in importance. Companies that establish and maintain empathy will have countless opportunities to secure a place in the heart of consumers. In the long run, the emotive and human elements of virtual conversations should not at all be neglected as they will ultimately create lasting connections and dictate the next generation of automotive experiences.
If this sounds intriguing, why not discover directly from industry experts and from carefully curated startups such as Labworks, Sofar Sounds, Travelloc, Tripscout or Venn how to strengthen community connections and bring something new to the table in terms of location-based experiences, events and gaming? Simply click here to watch the Porsche x STARTUP AUTOBAHN digital event.
In these ‘unprecedented times’ when uncertainty is our only constant — you know what overused word I am avoiding here — lifestyles are being turned upside down and consumers have been forced to reset their priorities. Safety and protection now come first and personal health and wellness have become the new luxury for many. As affluent consumers stand ready to pay a premium for it, luxury health care is on the verge of a meteoric growth. Seen as a healthy life extension, wellness is the ultimate luxury status symbol that spans generations and resonates with many.
A growing number of carmakers have been working to infuse health and wellness features in car design over the past years. Sensors that measure and monitor the driver’s physical health and level of alertness have been overcrowding the startup landscape lately. Beyond that, a first wave of applications that ‘purify’ air quality or self-cleaning, smart materials have already come to light to offer a glimpse of the future ‘vehicle of health’. But a second wave of technologies is expected to focus on the emotional and mental fitness.
And this is where Porsche’s playground is set. The company is envisaging the car as an oasis of comfort, freedom and protection from digital stress, where the passengers can have a private moment to themselves. Mental escapism, mindfulness coaching, mental performance enhancement, vital sign monitoring and anti-stress training are just a few of the up-and-coming trends. If you would like to learn more about Porsche’s perspective and get a sneak peek into the startup technologies of Detalytics, Flow Lab, Kenkou, Maaind and Smedo, click here to watch the Porsche x STARTUP AUTOBAHN digital event.
The luxury industry is on the verge of a profound transformation, furiously speeding past an age of traditional iconic items to a whole new world where technology is advancing at hyper-speed, meaningful experiences are top-of-mind, sustainability is a must and health is essential. It is clear that the only luxury businesses that will thrive will be those that are well prepared for this New Breed of Luxury. And with the help of STARTUP AUTOBAHN, Porsche is definitely one of them.
SOURCES
- 2020 Euromonitor International, Webinar:“ Luxury and COVID-19: Effects on the Industry“
- Forbes, „Health, wellness and well-being features in cars to accelerate due to COVID 19“
- Financial Times, „Oliver Blume: the Porsche CEO on the electric car revolution“
- Forbes, „What the aftermath of the global coronavirus pandemic will mean for luxury brands“
