A funny thing happened while I was on my bike ride yesterday. I was taking a break and watched as two Bentley’s drove by. Rather than feel envious all I could think was “what a waste of money” when another rider sitting next to me said “what kind of ass would spend that much money on a car?”. The era of symbols of extravagance maybe coming to an end.
The popularity of Bernie Sanders among young voters should be a wake up call to a lot of marketers and brands. Janice Joplan once sang a song that said “Lord, won’t you buy a Mercedes Benz” but today’s generations of voters would rather save their money so they can retire early rather than spend it on 5000 square foot homes, expensive cars and other signs of wealth.
While older and affluent Boomers still flock to luxury brands as a “statement” younger demographics prefer brands that provide a better value and utility. It’s one of the reasons why BMW has introduced a 1 and 2 series of cars.
A lot of marketers have stepped up their level of brand experience to the point that there is little differentiation between luxury brands and non-luxury brands. Do you really need to be seen in a Bentley or would you rather take that money and use it to get out of the daily grind of what’s known as working today?
Consumers also expect the wealthy to do more to benefit others. The Hollywood elite, for example, shouldn’t tell us how to live while they vacation in elite resorts and fly in private jets. The wealthy have more money, but shouldn’t they follow the lead of people like Bill Gates and donate more to benefit us all?
So what’s this have to do with marketing? Marketers, especially marketers of luxury items, need to understand that the “symbols” of wealth are changing from luxury brands to living and enjoying life. Consumers are going to expect more from everyday brands and they had better perform or else they will pay a hefty penalty.
When asked recently, during the record Powerball jackpot, what they would do with the money younger Millennials said that they would give most away to charity “because who needs that much money” while older consumers said they would buy things like big houses and cars. That I think says a lot about changing consumer behavior.