Film director and tech-philosopher, Somi Arian, discusses the appeal of digitally-savvy brands that are creating their own millennial-friendly ecosystems with a purpose.
This article originally appeared in Luxury Briefing 215.
There are brands that seem to have cracked the millennial code. You could even say that they’ve managed to gain their loyalty. In this article, I look at four brands that have become popular among millennials and offer some insights as to why these companies have been successful in attracting this ever-evolving demographic.
The brands in question are Apple, Uber, WeWork, and Lululemon. I have chosen four companies from different industries to show that this is more about a mindset, rather than just a given category of products.
You may not consider these ‘luxury brands’ in the traditional sense. However, given the amount of money that millennials spend on these brands, you can think of them as a modern-day luxury. For example, if you use Uber regularly, you have probably been ‘surged’, at some point!
Allegedly the more often you accept a surge price, the more likely you are to get surged in the future, thanks to their machine-learning algorithm. As a regular Uber user, I dare say that I spend more on Uber than I would if I used Addison Lee or Black Cabs. WeWork is another example. The offices are incredibly small, and for the price that you pay for a five-person office, you would get much more space almost anywhere else in town. Likewise, if you consider all the bells and whistles that you need to purchase every time you upgrade an Apple product, it quickly adds up. Finally, Lululemon has created an almost cult-following out of an unlikely subject, in luxury activewear. It’s become the most high-end among popular sport-wear.
So, why do millennials love these brands? It comes down to several reasons, such as how these brands collect and use customer data, and their infrastructure, which allows them to innovate in ways that are much harder for heritage brands. However, on a psychological level, there are two crucial factors that I believe contain useful lessons.
Ecosystem vs Product
All of these brands sell a lifestyle, rather than just a product. The significant point about this lifestyle is that it’s only achievable once you’ve become part of their ecosystem. These brands have found out exactly what millennials want. They understand the factors that drive millennials’ consumer behaviour, such as the speed of change, an abundance of choice, and valuing access and experience, over ownership. Millennials want instant access and convenience.
They have grown up in the digital world and have become used to the speed enabled by technology. These brands have understood the importance of staying on top of their customer’s mind and creating channels of engagement, with multiple touchpoints. They focus more on sharing a lifestyle, rather than just advertising their product.
A strong sense of purpose
All of these brands convey a strong sense of purpose and a global vision that’s bigger than just the product that they offer. This sense of mission and a ‘grand vision’, is something that many heritage luxury brands lack, or fail to communicate effectively with young people. It’s also something that millennials and Gen-Z care about, and it is becoming even more critical.
Uber is all about ‘changing the way the world moves’. Lululemon brands itself with a holistic vision of health and wellbeing. For example, they have in-store yoga classes and make a real effort to interact with their customers. Apple’s tagline, ‘Think Different’ is as appealing today as it was at the dawn of the 21st Century. WeWork aligns itself with the entrepreneurial spirit of the millennial generation, empowering them to challenge convention and start something new.
One important note is that all of these brands do make you feel like they mean what’s in their tagline! Uber has changed how we move from A to B and you can access an Uber almost anywhere. Think about how convenient it is to not have to get your wallet out when you get out of the taxi. For entrepreneurs, it’s much easier to book an office at WeWork without getting into lengthy contracts. They also create a real sense of community. Being able to pay for your groceries just by looking at your iPhone, is just so easy – and your data syncing instantly on all your devices has revolutionised the way we operate. Finally, Lululemon really does make you feel like you are part of a community that puts health and wellbeing front and centre.
If you want to attract the digitally-native generation and stay relevant, it’s time to look at building an ecosystem based on a strong sense of purpose.