Any major market change triggered by an economic downturn automatically brings with it an increased demand for premium products and services. This was demonstrated after the Great Recession of 2008, and if that were not proof enough, we are seeing it even more dramatically in markets that have been restructured due to COVID-19. One of the key elements of the term “premium” as a definition of consumers’ spending needs is the significant emphasis on appearance, packaging, and “frills”. This fact is a clear driver for the conscious planning and execution of the creation of a truly premium shopping environment, i.e. the premiumisation of the shopping experience.
Today, the smart premium world should not only focus on the “I’m premium” category due to generational wealth, as this new target group spends more than the traditional one if they feel appreciated, if they perceive that premium is truly premium. Very serious brands have also fallen victim to this change in attitude, and we can see the truly premium brands that have conquered the markets over the last decade. Many companies with premium products are still unable to respond to this shift, and one of the major restraining forces is their inability to get the support and background they need to meet these new demands. The cornerstone of this is that this new target group also wants to enjoy spending their money, as they have made their fortunes through hard work. An important part of their buying decision is that they are not “falling for” the usual “glitz” or big brand names. For them, a brand is about the customer experience. They will wear a piece of clothing with prid; theyy will get into a new car with pride, they will feel that they have dealt with a quality and premium business partner if the environment is exactly the same. They don’t over offer; they don’t employ the decades-old, often “make you feel uncomfortable” mental tricks. Because they have made their own money “with their own hands”, they place much more emphasis on being genuine. Turning this into a premium is the challenge of creating the point-of-sale environment of the future!
A practical environment
If I had to sum up in one word what a modern business environment that appeals to the most affluent premium target group should be, I would have to say practical. The use of this word is interesting because it does not traditionally refer to premium at all. In fact, it has been well known that expensive products, in general, are not the most practical. Well, this tradition is broken by this new, very dynamic and growing target group. Moreover, it is also an important factor that this target group is now being followed by a solvent demand, often with access to money through family rights, so meeting this demand is a critical factor. It is safe to say that in the case of high-end brands or premium services, practical shopping has always taken a back seat – with the exception – and when the product provider itself has wanted to move forward, there have been few suppliers to meet this need in practice. Indeed, the creation of a truly practical but clearly premium business space requires a combination of often traditionally conflicting professions. Indeed, even 10-15 years ago, practical shopping was still the expectation of the middle classes. This is not surprising, given that today’s premium target group was one pay bracket down. So knowledge of this area is essential for success. Another important factor is that interior design should also focus on usability. The design, procurement and execution of interior design should work closely with the marketing professionals responsible for creating brand concepts. This is a special new profession. It is not surprising that, since the new premium environment can be created by the perfect coordination of several different disciplines, this specialised expertise has given rise to a new field of consultancy. Understanding and serving a practical premium customer need is fundamental to the future of a premium brand, whatever the economic sector. And it is clear that this will only be achieved by providing a practical point of sale experience, a critical element of which will be the creation of a thoroughly modern, premium but practical business environment. It has always been a fact that a good office, a good shop, a good point of sale, has a clear influence on the customer’s decision. Nothing has changed in this respect, except that after a long period of closure, buyers now attach much more importance to everything than they did before. The related advisory area still has very little capacity today, as there are few businesses that can match this in terms of age range, ability to pay and even professional knowledge. But it is certain that in the future, the number of such firms will increase, and the premium business will start the process of incorporating this new profession into its sales and marketing objectives at a strategic level.
Gone are the days when, when selling a premium product or service, it was important that a new customer felt sufficiently intimidated on entering a marble- and diamond-studded store. He should no longer ask himself: do I really belong here? Although many traditional premium brands seem not to have realised this yet, the world has changed, and we are riding a different horse. The premium customer will decide the future of the range: is it really premium? And the world of mysticism will be replaced by reality.
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Riding upside down: the practical premium customer experience (Part 1)