Innovation is no longer the domain of a chosen few companies and sectors. In an era of rapid technological and market change, companies of all sizes...
Consumer experience is the name of the game in 2017. We previously pointed out that Millennials are more motivated to buy a product that contributes to an experience rather than a product that simply accomplishes a basic need
This isn’t just a Millennial phenomenon, though. Consumers across the board are beginning to prioritize investing in novel experiences over rudimentary needs. Liana Lubel, senior vice president of Nielsen Innovation Practice, puts it simply: “With increasing affluence, consumers are craving products that offer total experience. Beyond basic-need products, many consumers also are buying based on how products make them feel, and premium products tap directly into a desire for products that provide specialized, enhanced or exclusive benefits.”
What kind of products is Lubel referring to? For example, Lancôme customized foundation. No more endlessly trying to find the foundation that fits your skin type and tone the most. At Lancôme, they use a skin-scanner that detects all the tiny micro pigments that make up a skin tone. The scanner reads different areas of the face and then computes the perfect average to color match a custom foundation. http://www.elle.com/beauty/makeup-skin-care/a37223/lancome-makes-custom-makeup/.
Another way of classifying premium products is to look at their contribution to a better society. Or even better, the consumers’ feeling they are contributing to a better society when purchasing these products. Good examples of these kind of premium products are Dopper bottles and TOM’s shoes. The Dopper, a Dutch reusable water bottle, is produced to reduce the number of plastic bottles and donates a percentage of the profits to water projects in Nepal. TOM’s shoes are canvas slip-on shoes in which every time someone purchases a pair of shoes the company donates one pair of shoes to underprivileged children across the globe. By buying a Dopper bottle or a pair of TOM’s shoes, the consumer feels like he makes a positive change.
Lubel stresses that small companies can make highly successful premium products too, and more easily, in many cases, than more established brands. She makes it clear that larger, more established brands have a lot to gain by producing niche premium products. “Huge opportunities remain for established brands in the premium space, especially when there is sizeable gap between mass-market offerings and the existing premium tier. By leveraging their infrastructure and retail partnerships, large companies are uniquely positioned to reach a large consumer base with lower-tier premium offerings.”
In short, whether a company is a tiny start-up or a giant household name, investing in production of premium products is more vital than ever before. As a global community, consumers are investing more and more in unique premium products that offer niche experiences, and if you want your brand to rise above the crowd, you ought to begin investing in development of premium products, and fast!