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Luxury
Why future-facing luxury brands must favor excellence over perfection
What does it mean to be excellent, not perfect, in 2024, and why should luxury brands weave the answer into their strategy?
Luxury brands are redefining themselves according to what excellence means in today’s business context. That was the main thrust of the latest 2024 C-Suite Talk at the IMD Luxury 2050 Forum, in which Roberto Eggs, Chief Strategy & Global Market Office at Moncler Group, unveiled how the company’s structure aligns with its journey towards excellence.
It’s essential for leaders to understand the difference between the concepts of perfection and excellence. Perfection is a flawless state where everything is exactly right – and then it’s over. By contrast, excellence is a quest to become flawless. It has a future outlook, and that is where luxury brands should focus their energies.
What does the future look like through a luxury-brand lens? We live in a world of geopolitical tensions and resistance to the homogeneity forced upon us by globalization. As such, luxury needs to be more local, acknowledging increasing regional responsiveness.
To be excellent, luxury will need to adapt more to local and digital realities and trends. Questions abound here: Should AI play a role in the creative process? How should brands respond to increasing pressure on them from customers to integrate them into the customer journey? How far and where should they go with experiential retail?
Then there’s the question of sustainability, which arises from the fact that we are living far outside our planetary boundaries. Gone are the days when there was no end to consumption and when we drew on our natural resources as if there were no limits. All fashion brands are facing this challenge, but with luxury comes the extra question: How can we keep hold of years of tradition while also evolving and innovating in this context? What can we keep, and what has to go?
Weaving excellence into strategy means adapting to what is unexpected on the one hand and innovating on the other.
Eggs explained how Moncler, the Italian luxury fashion house renowned for its iconic down jackets, has been trying to develop a more direct-to-consumer culture inside the company. A great part of that work has been defining what Moncler stands for and what it doesn’t: “We are not just a luxury brand. We unleash the extraordinary in everybody,” said Eggs.
Excellence through a clear brand architecture
Excellence for Moncler means having a clear brand architecture; they have defined three different dimensions of the same brand, each targeting – communicating with – its core audiences:
- Moncler Genius target audience is 20–30—year—olds and puts a heavy emphasis on collaborations and co-creations, ranging from designers to musicians, car brands, and sports brands. It responds to a realization from Moncler that the catwalk, is to some extent, a thing of the past; this age group needs new content daily, hence the launch of new products every six weeks.
- Moncler Collection target audience is 30—50—year—olds. Eggs explained how the Maya jacket, a staple of this collection, is never on display in Moncler’s stores, equating it to the Hermès Birkin. “You need to create scarcity and desirability; we are not a supermarket — just the opposite,” he said. This jacket is always hidden and was used only once in an advertising campaign — for the 70th anniversary of the brand.
- Moncler Grenoble is all about skiing and high performance activewear, and aims to appeal to 30–40-year-olds. In February, it carried out a fashion show among snow-covered, fairy-lit trees in the Alps in St Moritz, blending style with sustainability.
Excellence through sustainability and seamlessness for consumers
Moncler embeds sustainability across everything it does. This might mean the way it designs its products (with AI) or via the development of products that can sustain time: “just the opposite of fast fashion,” said Eggs. “It’s our commitment to tomorrow. We focus on quality,” says Eggs. “We are trying to ship more deliveries as opposed to fly them and to make fewer samples.”
The brand is also engaging in responsible sourcing. It is committed to reaching levels of 50% recycled nylon and 100% lower-impact wool.
Excellence is also going to be less about delivering products and more about adapting to new societal needs and customer journeys. Hence, Moncler’s efforts are to be a multichannel organization that creates seamless experiences for its customers. “It was a big shift when the company moved from being completely focussed on the product to starting to develop an obsession with its clients,” said Eggs.
“We are not just a luxury brand. We unleash the extraordinary in everybody.”— Roberto Eggs, Chief Strategy & Global Market Office at Moncler
Separating what excellence means for employees, leaders, and brands
Test, learn, fail, and scale could become the new norm in luxury. It aligns with the fact we are seeing more collaborations, more breaking down of silos, and increased digital acumen and better use of data to understand customers better.
Leaders must realize we are moving from a culture of fear to one of psychological safety and courage; that people need to learn from their mistakes to do something greater. For example, the journey towards positive impact sustainability often requires trial and error. If you are a truly excellent company you will tolerate mistakes, but not incompetence. You will lay the ground for employees to experiment, without of course damaging brand reputation.
Leaders need to be like sponges, taking ideas from everyone and appreciating that together they can achieve more. They need to define the root and the journey with their teams and stick to it. Consistency in the delivery yields results, all the while knowing though you could perfectly well come up with something new each year-round.
You might well be dubious about whether leaders can change the company culture. Eggs says if there’s one way they can it’s by involving people. “When I joined Moncler, my mission was to redefine the direct-to-costumer approach of the company. This involved changing the way we were defining, planning, and delivering our collections to our stores, but also enlarging the culture that was very much product driven to a culture that became product and client oriented. We needed a cultural change in the company; therefore, I spent the first nine months working with my teams and redefining our retail excellence approach.
50% of the business was done by wholesale, 50% was done by retail and the mission I got was to undo the fact that ‘we are doing retail but doing it like we are a wholesale distributor still’. We had a lot of meetings with employees over the course of nine months. I think they were the best nine months ever invested in the company.”
In a more regionalized world, giving extra power to local entities to come up with ideas that resonate with their communities is going to be fundamental. Achieving excellence within this context will require greater balance between leading society and following where society is. Luxury may have thrived by cultivating a certain mystique, but its reinvention will require a heavy dose of transparency such that this will become a core value that underpins the industry.
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