Why Independent Luxury Brands Could Be The Next Hot Thing Post COVID-19 (2023)

What if COVID-19 was about to create a more levelled playing field for independent brands? This question seems iconoclastic. But there are precedents of changing fortunes in other industries. Take beer and the way smaller brewers managed to challenge even the likes of AB Inbev because they were on the pulse with changing consumer tastes and able to boost quality.

There is a convincing argument that independent luxury brands are much more in tune with post COVID-19 trends than the bigger players. Could now be the time when the “magic” of independent brands also helps them rise above the heavyweights?

At first sight, the decline in consumption that the likes of Philip Kotler, the father of modern marketing, fears will happen in the wake of COVID might seem dangerous for any luxury brand.

But because independent brands are used to competing by playing contrarian, ultra-responsible and sustainable and authentic cards, they could be ideally placed to seize the opportunities of new trends.


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The contrarian card

Independent brands go further than showing a creative spirit. They try to break with industry conventions to be more desirable in consumers’ eyes.

Take Eberhard & Co Swiss luxury watches. Whilst most watch companies are getting rid of retailers, Eberhard & Co is playing into retailers courts, helping them get business through the crisis.

According to Mario Peserico, General Manager of Eberhard & Co Italy, the brand deliberately stays away from e-commerce so that online sales can go to the local retailers of customers that contact the company.

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The brand has, though, accelerated its Instagram presence and created an interactive App, but with the specific purpose of being closer to consumers.

“Social activity such as Instagram facilitates requests from consumers, and we always try to give immediate feedback,” said Peserico.

On this point of digital ubiquity during COVID-19, the distance to end customers has become more democratic and is now more equal to all brands, providing a chance for smaller independent brands to have equal impact and similar presence. This is the view of Knirke Fester Schindler, Brand Director at La Vallée, a Swiss independent luxury cosmetic brand.

The smaller brands also seem to appreciate how less is more and are applying this to digital. As Fester Schindler continues: “Luxury companies have had a tendency to panic, searching for quick fixes during the lockdown to keep their employees busy and remain visible, offering online beauty consulting and webinars. The result and impact seemed somehow as a panic reaction and solution and did not always live up to the image that I had of the brand. Digital solutions have advantages but a clear strategy, even under exceptional circumstances, must be in place and aligned with the brand image.”

Consequently, she did not take La Vallée down this route.

A separate instance of a contrarian strategy can be seen in Louis Moinet watches. Whilst many brands have chosen to communicate their latest models or products during lockdown, Louis Moinet has done just the opposite by revisiting the founding product of the brand: the chronograph, with the house having invented the first ever chronograph in 1816.

Using a very small budget and battling lockdown logistics, it released a trilogy of short films called “James’ Odyssey” involving the owner, Jean-Marie Schaller.

The brand’s strong moral values are melded with beautiful fiction to give life to the brand. The company also released a 100-page Black Book to communicate what the brand is about and its history, and a new website.

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Storytelling is not just about turning marketing into stories, it’s about telling the truth, according to Kurt Kupper, Board member of Louis Moinet.

The responsible and sustainable card

Small brands have anticipated the way their (often local and small) supply chains are particularly vulnerable to disruption, and could even have disappeared, taking steps to stay close to suppliers to prevent this. In this sense they have nodded to responsible business leadership’s concern for addressing the needs of all relevant stakeholders and especially in more difficult times.

Take Buben & Zorweg, the world leader in luxury watch winders, safes and multifunctional safe objects Made in Germany. During the pandemic it stayed close to its supplier network: small family firms, highly skilled in very rare arenas of craftsmanship and all located in Germany but vulnerable to the crisis. It was transparent with its market information and gave them very frequent updates about a whole host of things: from order management of trade partners and the rescheduling of product launches, changes to fixed delivery dates and installation of bespoke projects, to new priorities in terms of material and product development, said Florian vom Bruch, its CEO. It even offered coaching services on project management, scenario planning and HR topics to create mutual solutions.

Elsewhere, the cancellation of major fairs and shows threatened all houses, making it impossible to present new products to retailers and distributors. With the economic crisis, some intermediaries were at risk. Showing responsible leadership here meant cultivating those relationships.

But Paris-based fashion designer Koché, also known as the haute streetwear label, mobilized its team to test fast a new virtual showroom for the forthcoming fashion weeks. To offer the best experience to its buyers and because they would not be able to touch the products, the brand created this virtual showroom in an agile way, by prototyping, testing with a few clients, and iterating.

Mixing magic with virtual skills, Fondation Valmont of cosmetics house Maison Valmont also initiated virtual tours of its most successful exhibitions. “Our Group likes to shine with its artistic commitment,” said Sophie Guillon co-owner of the company. “The public had access to magnificent artworks. […] Live experiences took our public from New York to Venice, from Munich to Hydra… Positive emotions were born from beauty, and what a treat within these hard times!”

From responsible management to sustainable management and the fair and equitable use of resources. Whitepod Ecoluxury Hotel in the high Alps found a way to benefit from the crisis by playing its green and nature-friendly credentials to differentiate from any other luxury resort.

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It is a place where energy and water usage are controlled, all waste is recycled, produce is locally sourced and the staff live locally or walk to work. By putting on a “Whitepod, Pure Swiss Air” campaign on social media, it reinforced this message. Patrick Delarive, its CEO, said that the hotel is already almost fully booked this summer in part because of these green, reassuring credentials where consumers have a thirst for real and sound values.

The authenticity card

All talk about cultivating the magic of independent brands comes down to authenticity: they are genuine because they are not mass-produced.

For David Candaux of the eponymous watch brand, “luxury conglomerates follow stock market considerations. As independent, family-owned and not listed, we do not have to play this game.”

He continues: “Consumers know that when there is scarcity, it is genuine and not artificially created by large groups. This comes across as more authentic. Customers know exactly who made their watch, this why the brand likes to refer to itself as wearing a Picasso on the wrist. It’s more like an artist-patron relationship.”

Whereas for big brands most of the value is in marketing, when it comes to independent brands, the value is found largely is in the product; in the real thing.

Should big luxury be worried?

Far from being beaten by the crisis, smaller independent brands are immersed in a flurry of creativity. Because of where they come from, they might already be more in tune with some of the new directions that consumers and society are taking.

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So, should big luxury brands from conglomerates be worried? Not quite, but they should watch closely the combination of consumer evolution and independent brands’ ability to respond to them. In highly disruptive environments, fortunes can change rapidly.


What are the three most important factors influencing the future of luxury? ›

Embracing values such as sustainability, inclusivity, and customer-centricity are morphing the concept of luxury into something different and exciting. The pandemic acted like an accelerator, fuelling change and shaping the landscape that luxury players will have to navigate in the years to come.

How can luxury brands stay relevant? ›


Exclusivity is fundamental to luxury brand marketing as it maintains consumer desire through scarcity and rarity. If anyone could walk into Louis Vuitton and buy a handbag, Louis Vuitton would lose their appeal to those who wish to have something that others can't get access to.

What luxury means in 2022? ›

We expect the very meaning of luxury will continue to evolve in 2022, becoming even more diversified and contextual. Where once it was all about status, logos and exclusivity, luxury brands are now actors in social conversations, driven by a renewed sense of purpose and responsibility.

Is the luxury industry a good industry to be in? ›

“Luxury is one of the most resilient industries there are. It is also one of the fastest to rebound after a crisis, as it has proven time and time again.

What is a key success factor to compete in the luxury goods market? ›

Some of the key success factors for luxury brands are their positive mindsets and forward-thinking approaches to changes in consumer behavior. Like most industries, the luxury goods market is changing. A move to digital operations is essential for growth, according to the report.

What is the most important thing in luxury services? ›

The most important element of creating luxury brands is the brand's ability to create and communicate symbolic value for its customers. Brands usually offer two types of value – functional value and symbolic value.

Why is luxury brands important? ›

It is all about creating a sense of exclusivity and luxury for a product or service. It can make a product or service seem more expensive and attractive to consumers, which can help drive sales. Luxury branding also helps companies stand out from their competitors and create a more memorable consumer experience.

Which are the 3 major characteristics of a luxury brand? ›

Nevertheless, it is important to note that each brand places extra focus on only one of the features shown below:
  • Craftsmanship. ...
  • Exclusivity. ...
  • Materials. ...
  • Design.
10 Nov 2020

What strategy do luxury brands use? ›

Exclusivity is fundamental to luxury brand marketing as it maintains consumer desire through scarcity and rarity. If anyone could walk into Louis Vuitton and buy a handbag, Louis Vuitton would lose their appeal to those who wish to have something that others can't get access to.

Is the luxury market growing? ›

The global luxury goods market is expected to increase from US$349.1 billion in 2022 to US$419 billion in 2027, at a CAGR of 3.7%.
Luxury Goods - In-depth Market Insights & Data Analysis.
Document:PDF + Excel (XLS)

What do luxury customers want? ›

Luxury customers feel power from spending big and satisfaction from obtaining exclusive, rare, and quality products. Luxury shoppers demand their brands to be 'woke'. They are concerned with the environment, including social and political issues.

Why is the luxury market growing? ›

Demand in the global luxury goods market is primarily driven by a rise in sales supported by growing affluence of people in several countries across the world.

How do luxury goods affect the economy? ›

In economics, a luxury good is a good for which demand increases more than proportionally as income rises. Luxury goods are said to have high income elasticity of demand. In other words, as people become wealthier, they will buy more and more of the luxury good.

Why is a luxury service important in today's market? ›

Luxury brands have long been admired for their product quality and how they treat their customers. They serve a demographic that expects nothing but the best, and these brands constantly strive to raise the bar. But luxury-level service doesn't have to come with products that cost thousands of dollars.

Which one is the main challenges of tomorrow within luxury industry? ›

One of the key problems facing the luxury industry is the lack of workers. Up to 65 percent of craft positions sit unfilled, according to 2021 numbers. LVMH, Chanel and Hermès are among the companies that have created programs to attract young people into careers in crafts.

What makes the luxury industry unique? ›

Quality of Make

Luxury products will tend to do more, be made of higher-grade materials, and last longer than their competition. The touch of authentic craftsmanship is second to none for luxury brands. Customers desire products and services done by top professionals with the highest quality.

What factors affect the demand for luxury goods? ›

Luxury good demand of individuals spending according to their budget is likely to be higher than those who don't spend according to the planned budget. Individuals having positive economic behavior might spend for luxury within their budget limits.

How does luxury become necessity? ›

Luxury became a necessity. It created jobs. No longer exclusively representing status and power such as the monarchy, instead it became part of the mass market. And that saw an explosion in self-expression and pleasure for everyone from labourers to servants.

What is the demand for luxury items? ›

Luxury items tend to be sensitive to a person's income or wealth, meaning that as wealth rises, so do purchases of luxury items. As a result, luxury items are considered to show positive income elasticity of demand, which is a measure of how responsive the demand is for a good to a change in a person's income.

What kind of demand does luxury goods have? ›

For example, luxury goods have a high price elasticity of demand because they are sensitive to price changes. 1 Suppose the prices of LED televisions decrease in price by 50%. The demand increases because they are more affordable to those who were unable to purchase them before.

Why you should invest in luxury brands? ›

Additionally, per Money Week, luxury brands are basically immune to price structuring and inflation. “Their margins are high, and they can put up their prices, because that is what their deep-pocketed customers already expect.” So when investing and reselling the item, you might expect the same high return.

Who is the target audience for luxury brands? ›

Today's luxury brand target audience is 25 to 44 years old. They comprise 64 percent of this overall audience. Don't sleep on the younger generation between 16 and 24 years old, also known as Generation Z. They're another big chunk of your target market.

Does luxury always mean better quality? ›

Customers will pay a premium because it is of better quality, materials, service, or process. Luxury brands do not always mean you're paying for better quality.

What are the 4 elements of a strong brand? ›

A strong brand requires a strong brand identity, brand image, brand culture, and brand personality. Implementing a successful brand strategy that develops all four of these components increases brand trust, loyalty, and awareness.

What are the 5 key features of a brand? ›

Five Key Brand Elements:
  • Brand Position. ...
  • Brand Promise. ...
  • Brand Personality. ...
  • Brand Story. ...
  • Brand Associations.

What is the appeal of luxury brands? ›

For some consumers, a luxury good can go a long way in increasing self-esteem or providing a sense of belonging. A sense of accomplishment is another reason why some people buy luxury goods.

What factors are most important to luxury buyers? ›

Here are the top 10 factors that luxury buyers' consider when making a new home purchase.
  • LIFESTYLE. ...
  • AMENITIES. ...
  • SECURITY. ...
  • VIEW. ...
29 Jan 2018

How do luxury brands create exclusivity? ›

Exclusivity can be accomplished in several ways such as developing limited edition products, making select products only available at certain stores, or developing a waiting list for a newly released item. For these tactics to work, a brand must be deemed worthy enough to 'beg for'.

What is the next booming technology? ›

Artificial Intelligence, Blockchain, Cloud Computing, Data Science, Virtual Reality, Cyber Security etc, are some of the best technology to get into in 2023.

What will be the next big technology? ›

Artificial intelligence will become more prevalent in 2023 with natural language processing and machine learning advancement. Artificial intelligence can better understand us and perform more complex tasks using this technology. It is estimated that 5G will revolutionize the way we live and work in the future.

Do luxury brands do well during inflation? ›

Luxury goods have a high-income elasticity of demand, meaning consumers' purchasing of luxury goods is highly sensitive to income fluctuation. As inflation drives purchasing power down, middle-class consumers may fall out of the luxury market.

Why luxury brands are sitting out the resale market boom? ›

WWD noted that “many luxury brands are reluctant to take ownership of the process, fearing that resale could cannibalize sales of their full-price products and dent their image of exclusivity.

Who is the largest consumer of luxury goods? ›

By 2025, China is estimated to represent between 40% and 45% of global luxury goods sales, compared to the Americas' 21%-23% and Europe's 16%-18%.

How do you attract luxury customers? ›

High End Clients – Top 10 Methods to Attract them
  1. Define your target audience.
  2. Create client personas.
  3. Design a compelling, high-end website.
  4. Use targeted ad campaigns.
  5. Launch a social media campaign.
  6. Improve your SEO.
  7. Establish your brand.
  8. Create compelling content.

What are the three levels of luxury? ›

According to Alleres (1991), luxury is composed of three domains: inaccessible luxury, intermediate luxury and accessible luxury, constituted by how the brand is marketed.

What is modern day luxury? ›

Nowadays, modern luxury means a certain style of contemporary luxury experiences and products. From this, we are driven by many ongoing issues, here, mainly on economic-related. The concept of modern luxury actually comes from the idea of creating the most up-to-date of products.

Why are luxury brands targeting millennials? ›

By the year 2035, millennials will be the largest spending generation in history, making them particularly enticing to any person or business marketing a product. Particularly as millennials grow into more financial security (older millennials), they have more disposable income for life's luxuries.

Which major factor affect the growth of the global luxury market? ›

The rising number of wealthy people is a major factor driving the growth of the market. LVMH, Richemont, Kering, and Estee Lauder are a few major players in the global market. Europe held the highest market share in 2019.
SegmentationBy Distribution Channel Offline Online
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When did luxury goods become popular? ›

Luxury has gradually invaded the modern economy, both in terms of products and activities and geographically: at the beginning of the 20th century, French fashion houses (Louis Vuitton, Cartier, Hermès); between World War 1 and 2, perfume (Chanel No.

Do luxury brands do well in recession? ›

Is luxury fashion well positioned to weather an economic downturn? Luxury fashion does better than other fashion categories during periods of economic downturn, due to its primary customer base being high-income consumers poised to weather a recession.

How do luxury brands survive recession? ›

Experts say luxury brands are often insulated in economic slowdowns because most their sales come from the super wealthy. LVMH, Ferrari and Capri are among the luxury companies reporting strong sales. Other companies including Walmart and Gap have slashed financial forecasts.

Why people buy luxurious things in the middle of a financial crisis? ›

Aspirational Spend Under Threat

Luxury tends to fare better than other sectors during a downturn because of its exposure to high-income consumers. Wealthy shoppers do pay attention to their net worth, and are less likely to spend when the market is down, but the impact is often less dramatic than for other groups.

What is the importance of social status in the luxury brand market? ›

Think About The Signal Of Social Status

One study found that as luxury products became more expensive, their labels and logos became smaller. This is because the higher the status of the group, the less likely they'll be to want to associate with the lower classes.

Why is social media important for luxury brands? ›

Above all, luxury products signal superior quality. As such, luxury brand's require superior social media content. It's essential to pay attention to the quality of the content posted, not letting anything less than stellar be sent out. A luxury brand's image is important, and it can't let weak content tarnish it.

Which are the main characteristics of the luxury industry? ›

It's down to half-a-dozen specific features:
  • Superb craftsmanship. Quality materials and high standards of hand-crafting that is hard to reproduce by machine are the embodiment of true luxury. ...
  • A rich heritage. ...
  • An element of scarcity. ...
  • A strong brand identity. ...
  • The use of public figures. ...
  • A superlative store experience.

Why are people obsessed with luxury items? ›

For some consumers, a luxury good can go a long way in increasing self-esteem or providing a sense of belonging. A sense of accomplishment is another reason why some people buy luxury goods.

What is luxury sustainability? ›

Sustainable luxury is a term used to describe the idea that you can have a luxurious lifestyle without having a negative impact on the environment. With sustainable luxury, you can enjoy beautiful clothes, a great home, and healthy food while still protecting the environment.

What defines a high luxury brand? ›

A luxury brand is a brand that is characterized by a high level of quality, exclusivity and high price tags.

What is the difference between luxury and premium luxury? ›

The key differences between a premium and a luxury car

With the price of luxury cars typically being too high for the normal customer, that's where premium cars step in. They offer normal customers more superiority in terms of materials, look, performance, and features, yet for a lower price point than a luxury car.

What are 4 major factors that could affect demand? ›

The economic factors that most affect the demand for consumer goods are employment, wages, prices/inflation, interest rates, and consumer confidence.

What are the 5 factors that can affect demand? ›

The quantity demanded (qD) is a function of five factors—price, buyer income, the price of related goods, consumer tastes, and any consumer expectations of future supply and price.

What are 5 other factors that can affect demand? ›

Market factors affecting demand of consumer goods
  • Price of product.
  • Tastes and preferences.
  • Consumer's income.
  • Availability of substitutes.
  • Number of consumers in the market.
  • Consumer's expectations.
  • Elasticity vs. inelasticity.

What is the importance of luxury? ›

Luxury brands often charge more for their products than those of lower-quality or less-exclusive brands. Because luxury consumers are generally wealthier than average consumers, luxury brands often enjoy higher profit margins than other types of brands.


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