Welcome to this edition of Brilliant Cut, a free monthly newsletter that helps you smartly navigate the most important luxury marketing stories and insights. Issue #21 | May 2, 2022 Furious Russian influencers are slamming Chanel for banning them (Fortune) Russian influencers are publicly criticizing brands like Chanel on social media because they can no longer get their favorite accessories.
Ya I really do think a lot of these luxury brands may miss on trying to go all in on "metaverse" and "NFTs".
Gen-Z (speaking as one, cannot represent the whole group of course), default operates on low-to-zero trust for brands and is used to micro-transactions and allergic to monetization strategies that come off as shoe-horned and not well thought out (or sucker into them short term but drop off.)
I don't think you can really shoehorn new technology and call it a day to sell it to Gen-Z and have a long lasting customer base that will buy from you again if your brand breaks trust in the short term (unless the products are exceptional in quality.)
Gen-Z definitely want real items, or if they are going to buy luxury digital items, it has to be tied/looped into a product that has high retention. All of these tactics break if there isn't a core loop these are integrated in when it comes to digital strategy, otherwise most of these brands are going to get stuck in linear-campaign-funnel-hell and really not have much value long term. That is why supply chain moats and IP moats (think Assouline's product development process for books being hard to copy by print-on-demand companies) will help, the question then becomes, is this item something Gen-Z can and will allocate for in the in the future? How does remote work type living play into this? Another dynamic is that if you make your customer appear to be a sucker after purchasing your item (NFTs for example, it's metadata on-chain, you don't own anything really, you just now have a receipt on a public blockchain, and receipt displaying itself is tasteless, so signaling status through NFTs makes no sense because we do that already today in games such as Call of Duty where the backend uses a regular database instead of storing it in some tx-based state machine like Ethereum. Oh and the counter about cross play, and interopability is not there engineering standards-wise so let's not go down that rabbithole either, we are far away from a Gucci item in Call of Duty being used in Fall Guys, etc.)
There are a lot of footguns here, and I only see leaky buckets for most initiatives until these monetization strategies are actually tied into some core loop, or the product is so good, people buy it repetitively. There is a big shortage of quality and physical experience of physical products, and to double down on bells and whistles may be good for demos, but nothing I see providing a may elevated experience than actual quality and craftsmanship given that's where the gap is today.
I think the best vector to actually get Gen-Z is through education, in-depth, non-manipulative, and clear and open communication strategies that inform them and cause them to eliminate desire for the low quality and cheap. Look at the "McMansion" dynamic, it is now a filter I use to make sure I don't overpay for a house, and learning what good is supposed to look like.
Ya I really do think a lot of these luxury brands may miss on trying to go all in on "metaverse" and "NFTs".
Gen-Z (speaking as one, cannot represent the whole group of course), default operates on low-to-zero trust for brands and is used to micro-transactions and allergic to monetization strategies that come off as shoe-horned and not well thought out (or sucker into them short term but drop off.)
I don't think you can really shoehorn new technology and call it a day to sell it to Gen-Z and have a long lasting customer base that will buy from you again if your brand breaks trust in the short term (unless the products are exceptional in quality.)
Gen-Z definitely want real items, or if they are going to buy luxury digital items, it has to be tied/looped into a product that has high retention. All of these tactics break if there isn't a core loop these are integrated in when it comes to digital strategy, otherwise most of these brands are going to get stuck in linear-campaign-funnel-hell and really not have much value long term. That is why supply chain moats and IP moats (think Assouline's product development process for books being hard to copy by print-on-demand companies) will help, the question then becomes, is this item something Gen-Z can and will allocate for in the in the future? How does remote work type living play into this? Another dynamic is that if you make your customer appear to be a sucker after purchasing your item (NFTs for example, it's metadata on-chain, you don't own anything really, you just now have a receipt on a public blockchain, and receipt displaying itself is tasteless, so signaling status through NFTs makes no sense because we do that already today in games such as Call of Duty where the backend uses a regular database instead of storing it in some tx-based state machine like Ethereum. Oh and the counter about cross play, and interopability is not there engineering standards-wise so let's not go down that rabbithole either, we are far away from a Gucci item in Call of Duty being used in Fall Guys, etc.)
There are a lot of footguns here, and I only see leaky buckets for most initiatives until these monetization strategies are actually tied into some core loop, or the product is so good, people buy it repetitively. There is a big shortage of quality and physical experience of physical products, and to double down on bells and whistles may be good for demos, but nothing I see providing a may elevated experience than actual quality and craftsmanship given that's where the gap is today.
I think the best vector to actually get Gen-Z is through education, in-depth, non-manipulative, and clear and open communication strategies that inform them and cause them to eliminate desire for the low quality and cheap. Look at the "McMansion" dynamic, it is now a filter I use to make sure I don't overpay for a house, and learning what good is supposed to look like.
Thoughts?