Headlines lately are saying that luxury brands are finally being embraced by young consumers—with one report indicating Gen Z and Millennials accounted for all of the luxury market’s growth last year. Brands are attributing this to the ease of online shopping, buy now, pay later programs, and the lure of crypto and NFTs. But YPulse data indicates it’s more than that; our Luxury Report shows Gen Z and Millennials will buy a product they consider luxury just to “treat themselves,” and luxury isn’t just about price to them now. In addition, owning luxury is no longer about just physical products: 41% of Gen Z tell YPulse they have purchased a luxury item in a virtual world (read: the metaverse).
YPulse data shows exactly what is driving young consumers to buy luxury—and what brands they consider to be luxury in the first place. YPulse asks 13-39-year-olds which luxury brand they most want to own something from and why, as open-ended questions, and shows its more than just the typical luxury house names (though they’re in there, too). In their own words, these are the luxury brands young consumers are most hoping to own one day:
Gucci is still the top luxury brand young people want to own
Last year, YPulse told you Gucci was winning young consumers with their social media presence, movies, and secondhand luxury popularity. And while all of that remains true, Gucci has also stepped forward as a leading brand to focus on video game marketing and securing brand loyalty from Gen Z in the metaverse. In 2022, they upgraded from a one-time Roblox event to a whole world, Gucci Town, full of games, hangout spots, and of course shops. They even ventured into The Sandbox with Gucci Vault which they describe as a retail experience that functions as “a time machine, an archive, a library, a laboratory, and a meeting place”—and it sells (IRL) vintage Gucci (including archival pieces customized by Alessandro Michele) as well as pieces from up-and-coming designers. And whether young consumers can afford Gucci IRL or not, they can be part of the luxury experience through virtual goods, which makes the brand all that more appealing.
And alongside other major luxury names, Gucci benefits from the fact that Gen Z and Millennials are most likely to say they are interested in owning luxury clothing, followed by jewelry, and purses / shoes / accessories. It’s clearly the point of quality for these consumers; one 14-year-old female says, “Gucci because they have quality and lasting products.” Even at a young age, Gen Z understands the value of quality, which is likely why they aspire to invest in luxury products. Others who tell YPulse they’d most like to own Gucci cite the uniqueness of the products: a 22-year-old male says Gucci is their top choice because “It stands out from others and their collections are also awesome.”
But it is of note that Gucci actually falls behind the top answer: none. Both Gen Z and Millennials’ most popular answer was that there were no luxury brands they’d like to own an item from. There were a variety of reasons they named for not choosing a brand, with one 27-year-old male saying, “I don’t want to own a item from the luxury brand at this time due to inflation.” Our data shows that 42% of young people now say that compared to last year, they’re shopping less to save money—and we know that the loom of a recession paired with relentless inflation has been driving this decision. But others cited they simply don’t care to own luxury, and some say it’s not worth the money; our data shows 41% of young consumers who have never purchased a lucury product5 say it’s because they’d rather spend their money on other things.
Gen Z consider brands like Nike and Apple luxury
Despite the fact that other generations may consider Nike a perfectly commonplace brand, Gen Z name it as the fourth top luxury brand they’d like to own. But YPulse data shows these gens are redefining what it means for a product to be a luxury; their budget for luxury is much lower than previous gens, and the history of a brand name is not so important as the quality feeling like luxury. When YPulse asks young people about the qualities that make them consider an item luxury, with options ranging from where it’s made to how much it costs and how it looks, their top answer (80% saying so) is higher quality. Comparatively, only 58% say it needs to be more expensive to be a luxury.
So as Nike has been a reliably quality brand to this gen, making products that last while also catering to the styles that are trending, it has become an accessible luxury to them that they’d like to own (if they don’t already). One 32-year-old male tells YPulse the reason Nike is the top luxury brand they want to own is “because I think it does something to [your] head that makes [you] feel motivated and good about [yourself].” Here, we can see that the brand messaging of confidence makes the products seem more luxurious, regardless of their price or name status.
While YPulse’s Mobile / App Behavior report data shows 77% of Gen Z with smartphones currently have iPhones, they still consider it the seventh top luxury brand they’d like to own. Their products certainly fall in the luxury range for this gen, regardless of how necessary they feel to young consumers—71% of Gen Z even says technology like smartphones are essential, not a luxury. But that doesn’t deter them from wanting all the matching accessories: One 15-year-old male tells YPulse they’d “like air pods because the other kids have them,” showing how luxury can also be about popularity amongst their peers as much as any other factor.
Millennials are more likely to want to own luxury cars
YPulse’s Auto report shows 57% of Millennials agree that “The kind of car you drive is a reflection of who you are,” which is perhaps why they are more likely to say they would like to own a car from a luxury brand. Tesla and BMW are sixth and seventh, respectively, on the list of luxury brands they’d like to own, and their open-ended answers give insight to the myriad of reasons why these brands are their picks.
One 39-year-old male says they’d like to own a BMW because they are “Quality made products that will be better for the environment.” YPulse data shows 47% of Millennials say they are more likely to buy a product that is described as sustainable, and BMW has made it a point to create sustainable initiatives for their brand. Their website indicates their plan to make their cars more sustainable in all steps of production, and beyond that, making actionable choices for the environment in the meantime—like planting peanuts around their factories and using the crop income to fund social infrastructure projects.
Tesla, being the top brand for electric cars, is of course leading in their sustainability draw as well. But beyond that, the technology Tesla offers is appealing to young consumers; a 25-year-old female tells YPulse they’d like to own a Tesla because “I like how more modern and innovative the cars are and the technology features.” Despite the reputation Elon Musk is shaping because of his forays with Twitter, Tesla remains a brand Millennials consider innovative—which our data shows is a key quality in determining brand loyalty for these generations.