Most companies in the luxury industry are faced with vast challenges, like new consumer behaviors, sustainability and corporate social responsibility. These are the greatest challenges that luxury companies need to deal with, however, at the same time, they can also be seen as new opportunities for the 21st century. New consumers, more ethical in their expectations, are growing in share of voice and power. Although social responsibility in the luxury industry is an emerging trend, stakeholders and market pressure, economic cycles and globalization will push luxury companies harder to act and evolve towards integrating social responsibility not only into their communications, but into their operations as well.
Most luxury companies, despite their slowness, are heading towards a strategic integration in which they will have to systematically consider environmental and social impacts, in addition to ensuring their financial sustainability. Most board rooms will have to adopt a deep mind shift and change the way they think, behave and manage their portfolio of brands.
Strategic focus of luxury companies will have to be shifted towards new dimensions, like People and Planet, as a way to keep profits at the historical levels. Even if corporate social responsibility is more widely adopted around the world by luxury brands, a gap is growing between consumer expectations and the real actions taken by luxury companies. These gaps provide incumbents the opportunity to focus on new high potential segments.
Whether motivated by new social trends, competition or a shift in strategic focus, the dialogue in boardrooms will have to answer to the following questions:
- How can we integrate sustainability into our brands?
- How can we overcome the perceived incompatibility of social responsibility and our luxury brands?
- How can we measure the return of investment of social projects?
- How can we identify latent needs of more ethical consumers?
- How can we manage the complexity of our supply chain in order to be more sustainable?
How CBE transforms Challenges into Results
CBE can support luxury brands in defining and implementing strategic plans consistent with the new social and sustainability targets without jeopardizing their economic performance, whilst improving brand reputation, innovation and productivity.
Our practice can help luxury companies to:
- Integrate sustainability into its brands;
- Overcome the perceived incompatibility of social responsibility and luxury brand perceptions;
- Measure return of investment in social projects;
- Identify latent needs of ethical consumers;
- Reengineer the supply chain by making it more sustainable and efficient.