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Future Luxe: In Coversation with Erwan Rambourg
On February 1st, the FACC Luxury, Fashion and Beauty Committee was pleased to host their first digital event of the 2021 season. The conversation was moderated by FACC-NY President Elsa Berry, Founder and Managing Partner of Vendôme Global Partners. Elsa serves as Managing Director as well as President of the French-American Chamber of Commerce NYC. Vendôme Global Partners LLC, a strategic financial advisory services firm focused on the Luxury, Beauty and Premium Branded Consumer industries on a global basis.
Erwan Rambourg has been a top-ranked analyst covering the luxury and sporting goods sectors for fifteen years. After eight years as a Marketing Manager in the luxury industry, notably for LVMH and Richemont, he is now a Managing Director and Global Head of Consumer & Retail equity research. He regularly contributes to the Wall Street Journal, the Financial Times, CNBC and Bloomberg, and has guest lectured at top universities in the US, Europe and Asia. He is the author of The Bling Dynasty: Why The Reign of Chinese Luxury Shoppers Has Only Just Begun (Sept 2014) and is finishing his second book Future Luxe: What’s Ahead for the Business of Luxury (Sept 2020), in which he identifies the major forces and emerging trends that are set to reshape luxury over the next decade after a period of virus-related turbulence.
Erwan has a very keen eye and understanding of the underpinning values of luxury and its key trends, he is a respected and widely followed luxury analyst and author. Future Luxe is ripe with insightful interviews with leading professionals from the M&A business as well as trends in luxury for 2021 and beyond. Future Luxe has received acclaim from numerous luxury professionals, including Burak Cakmak, Parsons school of Design Dean of Fashion: “Erwan draws on his expertise, supported by the insights of leading industry experts, to help us envision a different future for the luxury industry. Future Luxe is a must read for anyone thinking through the fundamentals of luxury in the 21st Century.”
Key takeways from the conversation include:
- The first part of the book focuses on the actual consumers of luxury. The luxury marketing pyramid is loosely based on the Maslow hierarchy of needs, the principle is as you become more wealthy, you will trade into luxury and up to more exclusive brands. At the top of the pyramid lies ultra high-end, bespoke luxury. The first group of emerging clientele focuses on females, supported by the Japanese concept of womenomics which states that as female employment rates rise, salary gaps get lower, the structure of the family changes and frees spending power. The second group reasserts that the Chinese consumer, again, for the 10 years, despite a repatriation of growth under COVID, will be essential. The final group of focus is youth. Youth have a different conceptualization of luxury, often referenced as casualization, which once noted as a trend has proved by its staying power to be a generational shift.
- Corporate world: during COVID, consumers are buying less but better. This purchasing power results in the larger conglomerates further reinforcing their position vis a vis small, independent brands.
- Substitutes to traditional luxury include affordable luxury and the premiumization of health . Consumers are investing in meditation apps and telemedicine, especially symptomatic of the American healthcare system and its inherent inequities.
Of particular interest to our French-American audience, Moderator Elsa Berry questioned, can there be an American LVMH? Erwan aptly replied that he believes the U.S. is an under-penetrated market and views a disconnect between consumer wealth and spending. Post 9/11, certain consumers found spending on wearables vulgar and retrenched in the concept of "quiet money", exemplified by very wealthy individuals who prioritize spending on a house or car, preferring to keep their own appearance discreet.
Lastly, our audience questioned whether easing of confinement will create a boom in the luxury market, or whether individuals starved for travel will spend on experiences and trips rather than goods. To that, Erwan responded that the pent up demand is real. Wealthy individuals have been able to save during this period, with rebounds in luxury expenditures observed both in China and the U.S. In short, if consumers are able to socialize and travel again, they will value their appearance and covet new luxury items.
If you are interested in purchasing a copy of Future Luxe, the book is currently stocked by Amazon and available on Kindle.
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