Last month, Sotheby’s hosted its auction in Hong Kong, and it was remarkable. With a span over a multitude of categories, from fine wines, champagnes, modern and contemporary art, diamonds and jewelry to East Asian art and curiosities, it’s estimated value exceeded $1 billion.
Their curiosity section presented “masterpieces from across time and geographical space, from Ice Age Siberia to Bronze Age China, Ancient Egypt and Medieval Europe”. The jewelry section featured a spectacular ruby, diamond and onyx bangle from the Panthère collection of Cartier, estimated at around $1.2 million. The 350+ lots of Dom Pérignon were expected to fetch more than $1.7 million.
What is interesting is that the business model of Sotheby’s reaches far beyond selling expensive items. What Sotheby’s is now doing, in reality, is to curate luxury and even create luxury. In luxury management books, luxury is defined as rare, hedonic, difficult to consume and acquire, a provider of extraordinary experiences, a social marker, and differentiator, and an item that enhances the social position of the owner. Part of the allure of luxury is that when it comes to the most luxurious products, they all have two things in common: First, they are scarce, often there have only been a few produced or few remain, ideally one. Second, there is a unique story connected to them, whether this is a historic moment, an adventure, or the connection to a historical and famous person.
Being rare and hard to find (hence, difficulty in acquiring) and in need of a good story is where Sotheby’s comes in. By carefully identifying objects of desire that have a history and a story and uniquely organizing collections, the auction house becomes much more than a selling platform: it becomes a storyteller and curator. This has always been important. But especially nowadays, where luxury consumers are younger than ever before. The role of Sotheby’s is to inspire millennial consumers, who are relatively new to many of the categories about what luxury is. By this, Sotheby’s becomes something like a commander-in-chief of luxury. This connection of vintage wine, a classic painting, or a piece of historic jewelry to a 25-year-old millennial consumer is shaping the perception of luxury for the top 0.1 percent of consumers.
At the same time, millennials are shaping the way in which Sotheby’s has to market their auctions and curate the items. As for millennials, especially in Asia, life has become digital, the curation of auctions and the connection with millennials bidders is becoming digital too. And since the taste and lifestyle of a 29-year-old urban tech billionaire from Southeast China will be very different from the taste of a 74-year-old oil billionaire living in a mega mansion in Palm Beach, Florida, Sotheby’s need to curate differently to be relevant to the hip, cool, cosmopolitan lifestyle that millennials are looking for.
But it also has challenges. Because millennials are the most challenging luxury consumers ever: They are super-empowered, digitally savvy, and, in my experience, the most demanding generation ever. They demand perfection in the customer journey — they get bored easily — as they have experienced much more than any generation before. Hence, addressing them with relevant content, curating suitably, and inspiring them with topics that they deem important is crucial.
Therefore, for auction houses like Sotheby’s, a regular assessment of brand positioning, customer journey, and its resonance with millennial consumers is indispensable, as well as generating real-time insights about consumers — their tastes, their conversations, and their lifestyles. Luxury and lifestyle brands, should be discouraged to use traditional market research, as it is not fast and precise enough. But instead, focus on advanced data querying; social listening and AI-based analytics, connecting trends and consumer consent with sales that will drive the future of curating luxury experiences.
The auction in Hong Kong has again revealed a fascinating interaction where the expertise of Sotheby’s is shaping the tastes of millennial luxury buyers, and millennials, in turn, are shaping how and what Sotheby’s curates and how Sotheby’s communicates by increasingly utilizing digital touch points. This is the future of luxury.
Source: Jing Daily
