Social commerce is not just for fast-fashion — young consumers wanting to expand their wardrobes are looking to their social feeds to inspire their luxury fashion purchasing. Ralph Lauren shared in its fourth quarter fiscal 2024 financial results Thursday (May 23) that revenue increased slightly year over year as the company gained new customers by the […]
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Social commerce is not just for fast-fashion — young consumers wanting to expand their wardrobes are looking to their social feeds to inspire their luxury fashion purchasing.
Ralph Lauren shared in its fourth quarter fiscal 2024 financial results Thursday (May 23) that revenue increased slightly year over year as the company gained new customers by the millions. Patrice Louvet, CEO of the luxury fashion and lifestyle firm, noted on a call with analysts that these new customers skew young, with the brand performing well among younger consumers under 35, helped by buzz generated via social media and celebrity influencers.
“Globally, we have significant activation with celebrities as well. … There’s a lot of heat around our polo hats, especially among younger women consumers. Taylor Swift wearing it, Jennifer Lawrence wearing it, and the list goes on. We’re clearly in the conversation,” Louvet said. “If you track what’s happening in social media, and the conversations going on there, you’ll hear and you’ll see talk about ‘Ralphcore.’ So, … good energy on that front. Net promoter scores are growing the fastest among our younger consumers as well.”
Indeed, the brand’s aesthetic is proving popular on social channels, with one TikTok influencer, for instance, gaining tens of millions of views on her videos showing people how to dress like the Ralph Lauren bear in its various outfits. Additionally, on Thursday’s call, Louvet highlighted the brand’s Instagram following of nearly 16 million as a testament to its strength on social media.
In fact, while social media trends may typically be associated with fast fashion brands such as Edikted or Brandy Melville, it is disproportionately high-income consumers who turn to social platforms for shopping. Supplemental research from “Tracking the Digital Payments Takeover: Monetizing Social Media,” a PYMNTS Intelligence and Amazon Web Services collaboration drawing from a survey of nearly 3,000 U.S. consumers, highlights this dynamic.
The study found that the majority (52%) of consumers who make more than $100,000 annually said they had browsed, considered purchasing or purchased goods or services through social media in the previous month. In contrast, only 43% of those who make between $50,000 and $100,000 a year and just 32% of those who make less than $50,000 said the same.
Additionally, Louvet contended that luxury shoppers have been gravitating toward brands with a reputation of providing more timeless looks, favoring products that transcend seasonal trends.
Overall, at a time when mass-market retailers are seeing their sales take a hit amid consumers’ economic anxieties, luxury shoppers are continuing to splurge on high-end goods.
For instance, Macy’s CEO Tony Spring referred to the retailer’s luxury subsidiaries, Bloomingdale’s and Bluemercury, as “bright spots” within the company’s portfolio on an earnings call Tuesday (May 21), with these segments of the business seeing positive comparable sales growth at a time when Macy’s comps overall declined.
Similarly, eBay CEO Jamie Iannone highlighted to investors earlier this month the counterintuitive trend of “luxury being positive even in this macro environment.”
Simon Property Group noted on its earnings call this month that it has seen softness with lower-income shoppers, while high earners continue to splurge.
“Certainly, the lower-income consumer has been under pressure now for quite some time,” David Simon, chairman, CEO and president of the real estate investment trust, said. “… Even though inflation is moderating, the prices that the lower income consumers dealing with are quite daunting. … The higher income consumer continues to spend and visits our properties.”
Indeed, higher-income shoppers are cutting back less than their lower-income counterparts, per findings from the February/March installment of the PYMNTS Intelligence “New Reality Check: The Paycheck-to-Paycheck Report” series.
The study’s survey of more than 4,200 U.S. consumers revealed that 45% of low-income (those earning less than $50,000 annually) and 41% of middle-income (those earning $50,000-$100,000) shoppers said they had cut back on the quality of their purchases due to retail product price increases. In contrast, only 28% of high-income (those earning more than $100,000) consumers said the same.
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