It’s a challenging climate for new start-ups, with the current cost-of-living crisis and the lasting repercussions of Brexit and the global Covid-19 pandemic continuing to reverberate in just about every sphere of business. But although the luxury market hasn’t gone unaffected by these ongoing pressures, the good news is that it has fared better than most others, with affluent, high-net-worth individuals helping to drive the recovery in our economy and continuing to spend on extravagant products and services where others may be cutting back.
If you’re starting a new luxury business in 2023 then it might feel like a daunting task, but it is possible to succeed with flying colours from the early days, if only you get the foundations right. Building a luxury brand is something that can’t – and shouldn’t – be rushed, and a few key ingredients are essential when it comes to cementing your brand as the go-to amongst your desired customer base and, ultimately, keeping them coming back for more.
Having the right finances in place to make it happen is essential, as creating an esteemed brand identity requires a substantial spend that shouldn’t be shied away from. Whether you’ve got limitless money in the bank to work with or need to take out a small business loan to get things moving, this isn’t an area in which to cut corners, so be prepared to invest in some key areas of brand building and spend what’s required, and you could find yourself reaping the benefits for many years to come.
From opulent fashion houses to high-end travel companies, there are some things that all successful luxury businesses have in common. Here are the key areas to focus on for getting it just right.
Know your niche
The world’s best-known luxury brands know their customers, and they know them well. So, whilst it can be tempting to appeal to everyone and offer a bit of everything when first starting out, bear in mind that this is likely to get you nowhere fast. It’s not just about knowing your customers’ wants and needs, either; it’s also about knowing your brand. A strong identity is essential and refusing to deviate from your brand values and mission will go a long way, no matter what challenges getting off the ground throws at you.
Identifying a large enough niche market early on, with the potential for strong growth in the long-term, is a non-negotiable, and that can only be done through thorough market research. Although once upon a time, the leading luxury brands tended to cater to only those who had already made it in life, those that have evolved to appeal to an aspirational Millennial and Gen-Z audience are now the ones raking in the profits – so be prepared to look ahead at the bigger picture, and to think outside the box.
Create a sense of exclusivity
The luxury customer buys products and services based on perceived exclusivity – which means the rarer and more expensive something is seen to be, the more highly coveted it will become. This is the very reason that limited edition collections and one-off celebrity collaborations by some of the world’s luxury fashion houses and high-end car brands receive such a great reception, and sell out in just minutes of their launch.
Creating an image that is synonymous with prestige and opulence isn’t an easy task, but the key to getting it right is broadening your focus well beyond the products or services you offer alone. Focus on what shopping with your brand means to someone as a whole, and sell the lifestyle, playing on heritage to create a captivating brand story that your target audience will want to be a part of.
Choose collaborations carefully
In 2023, collaborating with iconic celebrities and social media stars is a tried and tested means of elevating a new start-up’s reputation early on and cementing it as a covetable name that fans and followers will want to become associated with, fast.
This is ‘influencing’ at its best, and it’s a tactic that modern brands can’t afford to ignore – so whilst many of the traditional channels for marketing are still very much alive and well, getting your brand out there to the right audiences quickly, as well as securing the endorsement of prominent individuals who align with your brand, will be your secret weapon when it comes to fast-tracking your luxury brand to meteoric success.
