The evolution of luxury value perception. A cross-generational comparison of luxury consumers.

Abstract

Has the role played by luxury goods been the same over time? Historically, luxury brands were restricted to the privileged, the elite, and the wealthy, playing a significant role within the society since Ancient Greece. Given the increase of spending power in the twenty-first century, luxury consumption has become more and more pervasive in the current society. Given the subjectivity and fluidity of luxury, it results complex to give a single definition of this concept. Many authors and scholars have tried to list all the possible characteristics that could define the meaning of luxury goods. The scope of this thesis is to investigate how the meaning and the intrinsic values of luxury have changed over time and whether the consumer’s luxury value perception has muted, shifting from older generations of luxury consumers to the new ones. The key generational markets for luxury are nowadays considered to be Generation Y and Z, therefore this work is focused to develop a deep understanding of these cohorts, and particularly their attitudes, their behaviours and values to the consumption of luxury goods. Wiedmann, Hennigs, and Siebels (2007; 2009)'s luxury dimensions model has been applied for the theoretical framework surrounding this study, which has helped to provide a deeper understanding of Italian consumers' luxury value perception and whether it differentiates between Generations X, Y, and Z, as well as empirical support for the framework. The significance of this study is to get a better knowledge of consumer values and perceptions of new generations in comparison to the older ones. The study discovered that the functional value of the products – including quality, uniqueness, usability – is overall the primary driver of luxury consumption in Italy. Although there are some similarities between Generations X ,Y and Z, there are a few important variances among the three generations taken into account, concerning for instance the different evaluation of the self-identity, prestige and materialistic value of luxury goods. Marketers may use the findings of this study to segment consumers differently, given that targeting the luxury consumers by their level of wealth and income is no longer deemed enough. It is essential to communicate the right luxury values to connect with the consumer's core beliefs. To conclude, the example of Gucci, a successful luxury brand towards Millennials and Gen Z has been analyzed, to give a clear and concrete illustration of which strategies should be implemented in the luxury industry.