CONSCIOUS RICH ASIANS LOOK
TO LIFECYCLE LUXURY

Published on WARC.

2020 saw APAC snagging the biggest share of luxury store openings - 38.9% compared to other regions. This figure exceeds APAC’s 31.8% share for the whole of 2019, according to real estate provider Savills. Singapore has seen a similar trend to China where domestic spenders are coming out in full force to splurge. “Singaporeans, unable to travel during the pandemic, have been contributing to the brisk sales at Chanel, Louis Vuitton, Cartier, Dior and more,” says Ms Sulian Tan- Wijaya, executive director and head of retail and lifestyle at Savills Singapore.

 

While luxury sales have been surging here, it is still a hugely challenging time for the industry. Globally, we’re seeing marked shifts - what the World Economic Forum calls a ‘Great Reset’ of capitalism - coming to light across retail:

 

A category traditionally marked by excess is refocusing on the essentials.

Green space is replacing inventory-stuffed stores as shopping moves online.

And conscious shoppers are being more deliberate in buying less and buying better.

 

So how will shifting priorities alter long-held notions of luxury? What defines 21st-century premium in Asia?

 

For some time now, we’ve seen luxury brands responding with creative sustainable developments. For example, Hermès’s Petit h’s limited edition pieces made from offcuts and excess materials became a hit with Singaporeans who love the unique and quirky repurposed products such as pony-shaped bags, mushroom paperweights, and animal bag charms.

 

But beyond the common “waste not, want not” moves, we will see a richer kind of luxury that puts product life cycles into center focus - or what we call “Lifecycle Luxury” where upscale eco-materials, authenticity trackers, and functional luxe will define the new premium.

1) Upscale eco-materials: Low-impact materials are giving luxury a fresh look.

Around 80% of a fashion brand’s footprint is attributable to the raw materials it chooses and 92 million tons of that material ends up in landfill every year. In Singapore, 168,000 tonnes of textile and leather waste were generated in 2019. Only 4% was recycled, with the rest of the 161,000 tonnes incinerated.

 

As governments and businesses begin pledging carbon-neutral targets, the leathers and furs that once signalled luxury will be traded for more eco-friendly and ethical materials – from carbon-positive cotton to bio-based plastics – and will define a new kind of premium.

 

Luxury’s appeal has long been rooted in an element of exclusivity, so since many sustainable materials are still in the experimental phase, their uniqueness is set to be a major selling point. With 24% of consumers willing to pay more for recycled clothing or home textiles, the future of green design looks lucrative. Prada’s MiuMiu label is tapping into the allure with Upcycled by MiuMiu, a collection of one-off and numbered designs created by customising vintage finds from the ‘30s to the ‘80s.

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While in China, Angel Chang is combining ancient cultural tradition with electricity-free production, to create a new line of boutique luxury cotton dresses, each piece handmade by artisans in a remote rural village in Guizhou China, using just three ingredients: “sun, plants, and mountain water.”

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Furthermore, 43% of global consumers say they would pay more for a product with environmentally friendly packaging (Global Web Index, Core study 2019), and brands are beginning to innovate accordingly. Shiseido-owned ELIXIR is targeting to convert all of the brand’s flagship products into a refillable format by 2025. The Japanese cosmetics brand currently offers refills for its lotion products, and stated it can reduce ELIXIR’s plastic use by 85%. Meanwhile, Singapore design studio Forest & Whale has created biodegradable sustainable containers from wheat husk, which can be composted in facilities or even gulped down.

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Tomorrow’s luxury buyers take pride in purchases that do good. Boutiquefairs, a bi-annual shopping event in Singapore sets out to bring socially responsible buyers and designers together. The move toward earth-friendly materials signals a long overdue shift in what we deem worthy of showing off.

 

2) Authenticity tracker: A product’s past life is becoming its biggest selling point.

 

Retail analytics firm GlobalData predicts that the second-hand economy – valued at S$32.7 billion as of 2018, will surpass fast fashion retailers by 1.5 times within the next 10 years Specifically, the second-hand market for personal luxury goods has grown 9% per year since 2015. It now accounts for eight per cent of a €260 billion (almost S$400 billion) luxury market.

 

According to Google, half of all online millennials and Gen Zs in APAC now believe that pre-owned products have better value than new items. This explains why second hand retail shops are sprouting up in Asia, as well as global resale platforms such luxury consignment retailer Vestaire Collective. “We effectively only utilise 40 per cent of our wardrobes. The other 60 per cent consists of seasonal pieces, impulse buys, one-off purchases for specific events or just items we forgot we had”, says Fanny Moizant, president and co-founder of Vestaire Collective, as she weighs in during the launch of the site’s VIP Concierge Service in Singapore.

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Meanwhile, luxury powerhouses LVMH, Prada Group, and Cartier have been getting ahead of the game with Aura Blockchain Consortium, an authenticity-tracing blockchain to uphold the integrity of their products. Each product will be assigned a unique digital code that will be recorded on the Aura ledger. When customers make a purchase, they’ll be given login details to a platform that will provide the history of the product, including its origin, components, environmental and ethical information, proof of ownership, a warranty, and care instructions.

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This would mean the more luxury items change hands, the richer the stories surrounding them, and the greater their worth. It opens up an opportunity for brands that lean into long product lifestyles — touting durability and timeless appeal— to reframe passed-down products as a 21st-century premium.

3) Functional luxe: In the future of luxury, function comes first.

As societal values shift, so too will our notions of premium. As people learn to cut consumption and embrace the essentials, improving well-being and fulfilling experiences become top priority. We’re moving away from vain, pretentious luxury, toward a refreshing new intersection of function, and fancy. It’s as much about what the product says to the consumer about themselves and what they are committed to, rather than what it says to other people.

 

Gucci was wise to collaborate with The North Face on a 2021 capsule collection. The highly hyped collection includes tents and sleeping bags alongside outdoor apparel for the fashion-forward explorer. The growth of premium-priced outdoor products points to a larger shift in what we deem aspirational. Klarna’s 2020 Holiday Retail Report confirmed this shift, finding that 79% of its customers would rather be healthy than wealthy.

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As consumers question which products are really worth the investment, they’ll expect brands to justify their high price tags. The businesses that withstand the test of time will be those that feed our appetite for upscale essentials—delivering high-quality materials, sophisticated design, and most importantly, superior functionality.

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A prime example is the repeatedly sold out Telfar Shopping Bag, a simple top-handle tote bag which fashion search engine Lyst has dubbed the first “It” bag of the decade.

 

And for a peek into the future, look to ADIFF’s upcycled jacket that can turn into a tent. The $350 solution-based apparel is sold on a buy-one-give-one model. For every jacket purchased, another is given to a displaced person in need.

 

As the premium market gets a dose of practicality, high-end basics will become their own form of indulgence. Luxury is no longer just for looks. It’s meant to be lived in.

 

 

A new way forward

 

A waste-not world is turning its back on vapid and unethical consumerism. We will continue to see the rise of socially responsible brands working with like-minded communities to drive more dialogue, collaboration and innovation that seek to shift us:

 

From shame in luxe-guilt to pride in luxe.

From indulgent spending to buying better.

From trendy to trend-proof.

Ultimately, driving longevity will be one of the key ways forward for brands in the future of luxury.
 

For more retail trends, download TBWA’s latest global reportThe Future of Retail