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May 31, 2022

Why the luxury goods industry needs to move towards sustainability

Author: Becky Waldron

Luxury brands need to change if we are to have a fighting chance at overcoming some of the environmental crises seen today. Corporations must alter their practices to reduce the vast amount of harm that they are having on the environment and to mitigate the causes of a rapidly changing climate.  

There’s a misconception that luxury fashion brands are somewhat more sustainable than non-luxury brands and fast fashion companies. This perception likely comes from the framing of luxury goods as ‘long lasting’, produced in lower quantities and – for some items at least – made by hand rather than energy-hungry machinery.  

However, luxury goods can actually be more detrimental to the environment than their lower-value counterparts. This is for a number of reasons including harvesting materials that are rarer, and therefore more necessary to preserve, and often solely using raw materials which adds to exclusivity but drains valuable natural resources. Even if the quantity of stock is less, the quality is higher. Therefore, they are more elaborate, and sometimes less ethical, to obtain.  

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What defines luxury? 

A luxury brand has often been defined by the exclusivity of its products. This might manifest in the form of a high price tag, supported by rare materials, specialist craftsmanship, longevity and/or performance, and relevance, to name a few.  

The superior narrative that surrounds a brand often contributes to its exclusivity. Having built up a reputation, the name itself can end up being what makes a brand ‘luxury’.  

A luxury brand may be able to produce goods that can’t particularly be found elsewhere, at least not easily. This might be because of the rarity of its ingredients, the individuality of the design and creation process, or something less material and more sentimental, such as heritage.  

Examples of luxury items: 

  • Dior perfume – One of the most iconic luxury perfume brands that inspired the documentary Nose, following perfumer François Demachy on a hunt across the globe for raw materials to use for a signature scent. Not just a brand for perfumes, Dior retail other goods such as scarves, which undergo a meticulous and unique design process. 

  • Rolex watch – Positions its watches as ‘crafted from the finest raw materials’, built to last, created by its ‘inhouse mastery of watchmaking expertise’.  

  • Smeg fridges – Crafted in Italy, Smeg fridges are as luxury as these white goods get. “Smeg devotes considerable time, energy, and resources to perfecting the aesthetics of all of their creations. Design is so important in fact, that the company has worked closely with celebrity architects and designers for decades in order to create lines of visually stunning home and kitchen appliances,” - from Why is Smeg so expensive? 

  • Hermès - This Parisian artisan clothing brand are on a ‘constant quest for beautiful materials which stand the test of time’. The company prides itself on its independent, family-owned, French-housed entrepreneurial spirit and creative freedom.  

  • Swarovski – One of the most expensive and prestigious jewellery brands to date. Swarovski sets itself above the rest through its mastery of crystal cutting, with a ‘uniquely prolific’ creative process. The brand emphasises its heritage which began with Daniel Swarovski in 1891.  

Above you can see some of the most prominent luxury brand products with some insight into how they position themselves and what it is that makes them luxury above the rest. Some key themes include using raw materials, an unparalleled and elaborate design and production process, and the lineage behind the brand.  

Are luxury brands recognising the need for sustainability? 

It’s apparent that brands are highlighting sustainability within their businesses. Rolex, for example, has a Perpetual Planet project. Through this project, they fund a wide variety of scientific research that supports efforts to understand and manage some of the environmental pressures faced globally.  

NET-A-PORTER have the Net Sustain initiative, Chloé demonstrates a level of commitment to sustainable practises certified by BCORP, Swarovski state a ‘commitment to change’ to become a more responsible business, and Prada have established People, Environment and Culture pillars as part of its corporate social responsibility (CSR).  

The Fashion Pact, a coalition of companies in the textile and fashion industry, is not to be ignored, either. With dozens of signatories on the list of those committing to sustainably centred pledges, The Fashion Pact claims to transform the fashion industry, including luxury.  

From the outside this looks promising, but the same can’t be said for all luxury brands.Whilst some are demonstrating clear action, others are arguably box-ticking, mentioning ‘sustainability’ with vague statements, alongside other greenwashed buzz phrases.  

A clash in positioning? 

Brands are stepping up to, or at least seeming to step up to, environmental responsibilities. However, there are studies such as Can Sustainability be Luxurious?and Luxury and sustainable development: Is there a match? that have suggested that some consumers feel negatively about a product when tied in with sustainability. This is partly because of a perceived status decrease in a product and other decision-making criteria that typically don’t include sustainability.   

There is a motif in this topic, with branding and positioning playing a big part. Luxury brands portray their exclusivity through their messaging, so naturally, adding new and arguably heavy concepts like sustainability can be met with some reluctance.  

This can be both from company and consumer alike. Companies don’t want to offend consumers by implying that they need to change their values. When people are buying luxury goods, they don’t particularly want their desirous bubble to be burst by the seemingly sticky issue of sustainability, either.   

According to a study by Forbes, 87 percent of conversations between clients and brand advisors fail to mention any topic around sustainability. When it does get included, it is limited only to materials, forgetting other equally as important factors.  

The conscious consumer  

In contrast to the points made above, the conscious consumer is surely on the rise. The power purchasers of today, millennials, or those aged between 17 and 34, are expected to spend more than $200 billion annually (2018), according to Forbes. A First Insight study stated that around 60 percent of millennials and Generation Z consumers prefer to buy from sustainable brands. Not only this, but they were willing to spend up to 10 percent more to support their ethos.  

More marketeers are becoming aware of this, especially after the pandemic. So, to meet consumer demands and continue to excel, it makes sense that brands need to recognise the need for sustainability within their business. 

Media and science 

At this point in time, brands cannot avoid the scrutiny surrounding climate change and sustainability in fashion and beyond. Environmental issues are frequently covered in mass media, and social media represents a prominent space for these conversations.   

These platforms act as a way for these issues to receive the attention they require. It’s a space where brands can both easily be held accountable for wrongdoings and also receive praise for what they are doing right. This can contribute to a necessary pressure for brands to adhere to more ethical practices.  

The need to move towards sustainability is also glaringly obvious from scientific research. Brands, and the people who work for them, are finding it increasingly difficult to turn a blind eye to this issue.  

Filling the gap  

Luxury brands are aware that changes within their industries need to be made. However, whether it is being put into practice is a different matter. There’s some evidence that luxury brands are at least acknowledging the issue, as seen above. Yet, there’s still a gap.  

This gap lies in what is currently being done versus what urgently needs to be done. It’s not just a focus on how materials are sourced, but a whole myriad of changes that need to be made – with, ideally and ultimately, entire business models needing a reshape.   

Luxury brands as leaders 

One reason why luxury brands need to move towards more environmentally and socially sustainable practices is that, in many industries, these brands and their products often act as industry models (cited inSustainable luxury: current status and perspectives for future research).   

They are highly influential, with mass market companies typically following suit. Therefore, adopting better production processes and motivating beneficial consumer patterns, behaviours and mindsets is a responsibility that comes with their position.  

 

Owning the narrative  

The fashion industry is responsible for around 1,715 million tonnes of CO2 emissions per year, with the industry predicted to consume a quarter of the world’s carbon budget by 2050. While there are no specifics focused on luxury goods, they certainly feature in the overarching problem.   

Luxury brands must initiate a mindset shift. This includes moulding ideas around what’s ‘on-trend’, instead of rendering perfectly good items redundant. The association with ‘sustainable’ as anything other than desirable is also a flaw in buyer motives that should be evolved.  

As leaders who possess great wealth and power, luxury brands need to embrace sustainability and genuinely be a part of the movement.  

While there is an identifiable shift in how brands are approaching sustainability, they need to be built into the infrastructure of these businesses for outcomes to materialise.  Brands must employ ways of operating that aren’t environmentally destructive, alongside tackling issues around unjust treatment of employees along supply chains – recognising sustainability and all it encompasses.  

We’re at a point in time where the planet can no longer afford to lose against profit and making this commitment doesn’t mean a company has to suffer. That’s part of our ethos at Skydiamond, living sustainably isn’t about giving up the good things, it’s a different way to live – a better one. Innovation constantly finds its way into luxury brands and their evolution, so let’s include this creativity in how to work and live more sustainably, too.  

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