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Successful Responses to Social Issues by Luxury Brands

By Matt Moorut | April 01, 2021 | 0 Comments

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Sustainability has been a hot topic in the luxury sector for years but it came to the fore in 2020 alongside a raft of other social issues. Environmental disasters, the pandemic, BLM and other events heightened the scrutiny of brands to a whole new level.

Social Issues Rise to the Fore

To put it into context, Google searches for the “sustainable fashion” topic had never been higher than in 2019. In 2020, this volume was exceeded by 25%. The same was true for “sustainable jewelry” searches, which increased by a massive 75% in 2020 compared to the year prior.

Whether a luxury business is producing cotton goods or mining diamonds, consumers increasingly know about the potential issues and want assurance that their purchases are not worsening the situation.

Sustainability is just one area in which consumers’ interest is spiking. Diversity and inclusion, working conditions, supply chain ethics and transparency, philanthropic efforts and more have all come under the spotlight.

Rising Scrutiny Needs Addressing

These are all areas that few marketing leaders spent enough time thinking about prior to 2020 but that they’re increasingly tasked with solving for. That puts them in an uncomfortable position, left with questions such as:

  • How active should I be?
  • What actions should I take?
  • How should I communicate what we’re doing?

Ultimately, these questions need answering. Luxury brands and enterprises increasingly discuss efforts to address social issues in their earnings calls, seeing that it affects share prices. Sales are also directly affected. An Accenture study recently found that 29% of all shoppers would switch to a brand that’s committed to inclusivity and diversity.

Consumers Want Action

After the initial lockdowns in 2020, Gartner analysed the impact of brands’ messages on social media addressing issues. We looked at statements of support through to direct donations, and found a simple, consistent truth:

Brands who communicate tangible actions taken see the biggest uplift in engagement rates.

The opposite is also true. Luxury brands who communicate vague messages late often saw decreases in their average engagement rates.

Luxury consumers in particular seek this action. Gartner’s Consumer Values and Lifestyle Survey surveyed 3,000 US consumers, and found those who self-identify as ‘affluent’ are much more likely to agree that businesses should take the lead in solving key issues in culture and society than others.

Consistency is Key

There is another element to this:

Luxury brands need to be consistent in their messaging around social issues to achieve success.

Tiffany & Co. is an example of a luxury brand that shifted its messaging to centre much more around philanthropic efforts over the past few years. Its organic social posts around donations to protect African wildlife initially saw decreases in engagement but after doubling down for some time, these now serve to considerably increase overall KPIs.

As part of our Luxury 2021 Digital IQ research, we even found Tiffany & Co. spending on Facebook ads to promote their social initiatives – putting their hands in their pockets to communicate efforts to prospective shoppers.

Takeaways for Luxury Marketing Leaders

Scrutiny around social issues is not a flash in the pan. It is growing rapidly and consistently and has a direct impact on business goals. Whether they want to or not, marketers need to be proactive, communicate directly and regularly. This will maximize the positive impact of social initiatives and so help CSR efforts to succeed.

If you’re interested in the topic – set up an inquiry with us! I’d also strongly urge you to read the Luxury 2021 Digital IQ released in April 2021, which covers the key digital marketing strategies that have separated leaders from laggards in the luxury industry.

The Gartner Blog Network provides an opportunity for Gartner analysts to test ideas and move research forward. Because the content posted by Gartner analysts on this site does not undergo our standard editorial review, all comments or opinions expressed hereunder are those of the individual contributors and do not represent the views of Gartner, Inc. or its management.

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