The luxury industry is flourishing and getting stronger. The lavish habits of millennials, ascending demands from wealthy Chinese and growing Silicon Valley customers are uplifting luxury brands. These brands are giving heed to the new forms of payment that includes cryptocurrency as a new pool of wealth.
Luxury brands have adopted cryptocurrency as a new way of payment instead of relying on virtual currencies. 18 of the most prominent luxury trends were examined by CB Insights covering everything from artificial technology, connectivity for luxury services to flying cars and reported that virtual currencies are no longer seen as a means for a traitorous end. As stated by Luxury Trends 2019,
“Bitcoin is now trading well below its all-time high of almost $20,000, but luxury companies haven’t lost faith in cryptocurrencies just yet.”
New perspective and Approach
A class of crypto rich people spontaneously emerged as the prices of cryptocurrency had a steep rise at the end of 2017. According to the reports, many cryptocurrency investors have been spending on splendid residential acquisitions as well as on luxury cars such as Range Rover.
The rapidly growing segment of millennials is also targeted by luxury companies welcoming crypto-payments as the majority of American millennials are cryptocurrency holders and users.
According to reports, the Swiss luxury brand of watchmakers Hublot celebrated the 10th anniversary of Bitcoin creation last year in November. They celebrated it by selling a limited-edition watch series. The cost of each one of 210 unique pieces was around $25,000 and could only be bought using Bitcoin.
The way century-old brands like Louis Vuitton and Gucci are adapting to the demands of modern age shoppers speaks volumes about the growth of the luxury industry. The transitory experiences such as pop-ups and limited additions along with the partnership of these brands with e-commerce platforms are escalating each year. Reports also suggest that these trends are expected to accelerate this year. The resources add more to the story as it is anticipated that an expanding share of luxury consumers’ wallets is going to be captured by new technological advancements.
The new technologies are envisioned to start with smart apparel and accessories towards extending it into new anti-aging therapies along with new AR/VR experiences.
Luxury brands are ready to be indulged in exclusive experiences by allowing their customers to purchase products using cryptocurrencies. By accepting crypto-payments, luxury brands are considering not to restrict the purchases to limited editions of their products; instead, they are focusing on adding more of their items to the crypto purchased bucket.
The report says that luxury experience to unattributed payments can be contributed by cryptocurrencies. For instance, the art collectors who want to avoid thefts by not revealing their identity and the affluent consumers in the countries having unstable political position who want to impede their assets being seized, privacy remains an eminent concern for the world of luxury consumers.
However, it isn’t an easy adaption to accept cryptocurrencies without considering its potential risks. Luxury brands will have to protect themselves against the elevated levels of volatility in the cryptocurrency values for this initiative to be successful. Stronger compliance processes will be needed to assure the acceptance of legitimate funds by luxury brands.
Editor of IMD News