Luxury today - go green or go home?
"Sustainability" is the new buzzword in marketing.
We, as consumers, are increasingly conscious about our carbon footprint. Our attention focuses not only on the food that we consume, but also the furniture we place in our homes, and the fashion pieces in our wardrobes. As a result, brands are incentivised to put sustainability as a priority in their promotional campaigns.
Consumers' demand on sustainability
Consumers are increasingly motivated by values beyond price and big names. In a survey published by The Hong Kong Polytechnic University in July 2022 on consumer perceptions of sustainable fashion in Hong Kong and Macau, more than 80% of the respondents stated that they would consider a brand's position on sustainability issues and if the product is sustainable when deciding whether to make a purchase.
Consumers now demand brands to produce their products sustainably which entails a commitment to ethics in their operations. Brands are asked, among other goals, to offset their carbon footprint, reduce their carbon emissions and to support fairtrade and equality in production.
This switch in attitude is perhaps reflective of an influx of new generations of luxury customers: the Millennials and the Generation Zs ("Gen Zs"). Aware of the increasing threats of climate change, evidenced by frequent natural disasters over recent years, these new customers are conscious of their own environmental impact. As such, they may be more willing to support sustainable and ethical businesses.
The luxury industry's response
Over the years, different luxury brands have positioned themselves to satisfy the request for sustainability. Tiffany & Co., for example, has advertised its zero-tolerance policy for purchasing diamonds from countries with human rights infringement, and has funded initiatives in relation to responsible mining and marine conservation through the Tiffany & Co. Foundation.
Rolex, on the other hand, has launched the "Rolex Award for Enterprise" which gives out cash prizes to entrepreneurs between the age of 18 to 30 for projects that bring positive environmental change.
Not only are brands committing themselves to fund sustainable initiatives, some are also reinvesting their profits into developing more sustainable practices in both production and sales.
For example, Patagonia recently announced that it is replacing virgin polyester in its products with recycled ocean plastics, reducing their carbon footprint by 13,000 tons of CO2e, and aiming for a full transition to renewable or recycled materials in all its products by 2025. Meanwhile, Bally launched its first virtual live showroom in 2020 as a strategy to adapt to the travel hiatus caused by the pandemic and in an effort to reduce CO2 emissions caused by travel
Collectively, various companies in the fashion and textile industry have also come together to form a global initiative known as the Fashion Pact. Its members include multiple upmarket labels such as Hermès, Ralph Lauren, Chanel, Chloé, Celio, Bally and Prada. Together, they committed to a common core of environmental goals: to stop global warming, to restore biodiversity and to protect the oceans.
In December 2022, the Fashion Pact announced its Collective Virtual Purchasing Power Agreement, for the group's investment into renewable energy projects across Europe. According to the Fashion Pact's press release on 8 December 2022, the Agreement seeks to add over 100,000 MWh per year of renewable energy generation to the grid, offsetting the emissions from approximately 24,400 cars on the road.
A leap forward
With Millennials and Gen Zs being accountable for more and more luxury purchases, an increasing number of luxury labels are taking real life steps towards sustainable practices, beyond pledges and campaigns.
The actions of the Fashion Pact and other brands and retailers is a welcome step for the luxury industry to turn towards the goal of preserving our planet and its resources. It is clear that the big players are now working towards sustainability which is an encouraging start to a new era in luxury, and it is anticipated that an increasing number of brands will follow suit.