Marketing Luxury to the Next Generation

By Amy Colbourn, Managing Director, Business Strategist at MONOGRAM

You’ve likely heard of “The Great Wealth Transfer.” Experts estimate that between $70 and $90 trillion in the U.S. alone—that’s right, with a “t”—is expected to pass from Baby Boomers to Gen X, Millennials, and Gen Z by 2045. This is the largest intergenerational transfer of wealth in history.

Why Does it Matter for Luxury Brands?

We’re not just talking about who has money—we’re talking about how values, lifestyles, and expectations are changing with the transfer of wealth. The next-gen affluent consumer doesn’t define luxury as their parents did, and understanding the new luxury consumer can help luxury brands prepare for what’s next and shift their marketing strategies accordingly.

When it comes to luxury, the current high net worth consumer is focused on status, exclusivity, and ownership. Their version of luxury is quiet indulgence, and their loyalty is rooted in heritage, quality, and reputation. Sounds traditional.

How they communicate is also more traditional. It likely comes as no surprise that Baby Boomers prefer legacy media like print, TV, and in-store. And, when I tell you that younger generations are far and away more influenced by digital media, it’s also no surprise. But, dig a little deeper, and you’ll see the nuances between generations, which luxury marketers will want to focus on to be most effective in reaching and resonating with the next wave of luxury spenders.

Let’s first look at the differences between each generation to better understand where they come from. Then, we can look at the similarities to craft implications for marketing luxury.

The Generations, Defined

Gen X: born between 1965 and 1980, currently between 45 and 60. Now at the peak of their career, Gen X is either raising teens or empty-nesting.

The Gen X mindset is defined by skepticism, independence, and pragmatism. When it comes to spending, they are conservative while valuing quality. Like their parents, their view of luxury is more classic and understated. When they travel, they want it to be comfortable, private, and relaxing.

Millennials: born between 1981 and 1996, between the ages of 29 and 44. They’re career-building, parenting, and wealth-building.

The Millennial mindset is defined by purpose-driven optimism with an underlying burden. When it comes to spending, they are aspirational buyers who prefer experiences over stuff. Their view of luxury is that experiences equal status. When they travel, they want it to be experiential, authentic, and shareable.

Gen Z: born between 1997 and 2013, currently between the ages of 13 and 28. They’re either students or early in their careers, but either way, this generation is forming their identities.

Gen Z is progressive and hyper-aware. They are fluid spenders who possess a champagne taste on a beer budget. Their view of luxury is that brands equate to identity, but they want uniqueness, not status. When they travel, they want it to be creative, bold, and most importantly, purposeful.

The commonalities among the generations about to inherit gross amounts of money are changing the luxury consumer landscape in a way that’s never been done before.

Implications for Luxury Marketing

#1 Redefine what Luxury Means
Shift messaging from “having” to “being”—experiences, transformation, identity.

#2 Elevate Storytelling and Transparency
They want to know who made it, where, and why. Tell them.

#3 Digital Integration is Non-Negotiable
Omnichannel is table stakes. Luxury consumers now discover on Instagram, research on TikTok, and buy through a concierge.

#4 Make it Personal
Create tailored experiences and use data to deliver luxury that “knows them.”

#5 Embrace Identity Fluidity
Younger generations are more diverse across gender, ethnicity, and lifestyle. Outperform by celebrating creativity and expression.

Trust Ignites

As all three generations tend to have low levels of trust, trust reigns supreme as the ultimate consumer currency. Trust must be earned. To do this, brands must deliver impact, relevance, and interaction. Legacy isn’t enough to tow the line of trust for these generations.

Trust also aligns strategically. It’s essential to segment audiences by values (the “why”), not just wealth (the “what”). They will prioritize what they value.

Parting thought: You can always tell what is important to someone by paying attention to what they spend their money on.

If you need help preparing your luxury brand for the next-gen luxury consumer, contact MONOGRAM today to schedule a complimentary brand consultation with our team.