In an age of fast changing trends, luxury companies have started to keep an eye on a new consumer class that is rising nowadays and is going to become increasingly relevant in the future: the HENRYs (High-Earners-Not–Rich-Yet). In addition, companies are committing to make significant investments in stimulating the interest of the younger segments of the population, namely Millennials and Gen Z: the customers of the future.
Since these ‘new’ tech savvy generations look for individualized, seamless brand relationship, brands are investing worldwide to market digitally, increasingly using social media to engage with these consumers. Meanwhile, companies are also re-examining the value of brand heritage and brand history for their customers. Consumer demand has become the core focus of the business, hence the adoption of an onmi-personal approach, irrespective of the choice of channel. To do that, they rely more and more on digital technologies, such as Artificial Intelligence (AI) and Big Data, which are helping them in redesigning customer engagement techniques through data analytics.
In this path between the old and the new, they are facing customers’ increasing sensitivity towards privacy but are trying to convert it into an opportunity to offer more personalized products and services to their customer base. The emergence of a new luxury segment - the HENRYs Luxury brands have started to initiate and sustain longstanding relationships with a new consumer class who is likely to become or remain affluent or ultra affluent in the future A new consumer class has started to rise recently and is likely going to be very relevant in the future, especially for luxury brands: the HENRYs (High-Earners-Not–Rich-Yet). Currently, they have a significant discretionary income and are highly likely to be wealthy in future. It is thought that HENRYs earn between US$100,000 and US$250,000; they are aged on average 43, with an income of more than US$100,000 and investable assets of less than US$1 million. HENRYs are digital savvy, love online shopping and are big spenders, in particular the Millennial HENRYs With HENRYs likely to become some of the wealthiest members of society, the potential benefits of onboarding this demographic to luxury brands’ product and service portfolio are twofold: securing valuable present customers and building client relationships and business with those most likely to be amongst the most affluent consumers in future. Therefore, luxury brands wishing to target HENRYs must offer inclusive, yet individualized and self-expressive products. As HENRYs are a critically important customer segment, loyalty could be built by endorsing their core values, such as authenticity, relatability, commitment to do the right thing, and following sustainable practices.
Consequently, brands have started to deliberately focus on values shared by this aspirational demographic. Finally, since HENRYs are heavily influenced by modern technology and use of social media to form their buying decisions, luxury brands have started to engage with these customers by leveraging on social media platforms.