Megatrends: Premiumisation Continues to be in Demand Amidst the Cost-of-Living Crisis

DUBLIN, March 22, 2024 /PRNewswire/ — The “Megatrends: Premiumisation” report has been added to ResearchAndMarkets.com’s offering.

This report provides an update on Premiumisation – one of the 10 megatrends, exploring the three key pillars of the trend to highlight where opportunities lie for business. Premiumisation continues to be highly sought-after by consumers seeking to enhance their wellbeing and consumers willing to pay more for premium products and services. In response, companies have leveraged consumers’ desires and wants through innovation and active marketing.

Key Findings

Premiumisation continues to be in demand amidst the cost-of-living crisis

Despite the current cost-of-living crisis, consumers continue to value premium products. This is driven by wellness, technological benefits and convenience. By being more discretionary in their spending, they purchase fewer items yet with better quality, to serve for their own self-love and building a better version of themselves.

Rising income and the attitudes of Gen Z consumers to spend more on themselves

Despite being cost-conscious, Gen Z consumers will arguably be one of the most important consumer groups for premium products and services, given the gain in their purchasing power by 2028. Moreover, they will also form the backbone of economic growth and will drive growth.

Consumers satisfy their own desires and wants through premiumisation

Consumers satisfy their own desires and wants, seeking greater value to specific benefits that serve their distinct lifestyles. This is done through looking for customised products and services that are personalised to their own liking, as well as indulgences and convenience solutions such as snacks and ready meals as well as luxury goods.

Consumers spend more to build a better version of themselves

Consumers seek to become their “best selves” and enhance their wellbeing, demanding more healthy solutions that take care of their physical and mental/emotional wellbeing.

Affordable premiumisation set to gain momentum

To cope with the high cost of living, consumers have normalised value-seeking products yet still demand affordable premiumisation. In response, brands are introducing this concept of “affordable premiumisation” where prices are lowered slightly and resold while still being positioned as premium to attract consumers.

Key Topics Covered:

Introduction

Megatrends: Premiumisation – a framework for the futureLeaders harness megatrends to disrupt a marketKey findingsPillars of Premiumisation

The evolution of premiumisation

Premiumisation continues to be in demand amidst high cost of living environmentConsumer expenditure set to grow as consumers seek to enhance quality of lifeGen Z set to be key target consumer group for premium products and servicesPremium private label set to rise with growing interest in value-added functionalityAffordable premiumisation appeals to price-conscious consumersBalenciaga joins the group of luxury brands venturing into resale with its Re-Sell platformOpportunities and challenges for premiumisation

Personalisation

Personalisation continues to be highly valued by consumers to suit their lifestylesHugo Boss invests in greater personalisation with a new AI Digital Campus in PortugalZoe: gut health to play a pivotal role in consumers’ personalised nutrition journeysAutomatic coffee machines continue to thrive offering personalised experience in homes

Permission to Indulge

Snacks: Premium positioning through perceived luxury and indulgenceFood brands move to untapped categories to appeal to indulgence and premiumAspirational consumption of alcohol drives premiumisation

Self-care

Consumers turn to the only ones they fully trust in an uncertain world – themselvesAgainst a background of wellness, “home as sanctuary” evolves catering to self-careInflation leads to consumers indulging in small splurges to make themselves feel goodRise of premium beauty and personal care products to appeal to consumers’ self-careWellbeing products including natural mood enhancers serve to provide self-careMood enhancing emerges as a consistent self-care experiential claim in premium positioningAromatherapy Associates combines emotional and physical wellness solutions for self-care

Health is the new wealth

Consumers prioritise wellbeing and are willing to pay a premium for functionalityFood products with clear nutrition benefits sought-after by consumersHealth claims in products increasingly desired by parents for their childrenPet food has also launched health-orientated premium food due to health and wellness

Buying Experience and Community

Buying experience and community continue to be sought-after by consumersDigital transformation enhances consumers’ buying experience for luxury goodsLuxury resort Ahau Collection introduces new NFT loyalty scheme to attract Gen Z touristsLotte Duty Free taps into the metaversePet shops and superstores invest in elevating the in-store experienceConsumers are willing to pay a premium on community-based drinking occasions

Implications for future growth

Premiumisation set to record slower growth over the next 10 yearsGrowth will come from emerging regions such as Eastern Europe and Asia PacificPremiumisation to remain relevant as consumers desire to feel good

For more information about this report visit https://www.researchandmarkets.com/r/t8j51g

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