With soaring energy prices and rising inflation, the business of flaunting wealth could suffer a setback, but it may not happen.
When her heating broke at the end of November, British influencer Lydia Millen decided to go to Britain’s oldest luxury hotel, the Savoy, where rooms start at around 660 euros and cost over five thousand euros a night: “I’ll make the most of their fantastic hot water,” he told his 797,000 TikTok followers (who surpassed 830,000 today). The post garnered 3.9 million views and, predictably, drew vehement reactions. Many commentators have compared Millen to Marie Antoinette, while others have made jokes like: “My TV is broken, so I chartered a private jet to fly to Qatar and watch a live game.”
Millions of Britons, as in the rest of Europe, are suffering from soaring energy prices; six days before Millen registered at the Savoy, inflation in the UK was at its highest level in forty-one years. Many families in the country are forced to choose between heating and food, while railway workers, nurses and firefighters have carried out or are planning strikes due to too low salaries.
Globally, the story is much the same and economists fear the world is on the verge of another recession. The reaction to Millen’s post therefore raises an interesting question: What happens to influencers in times of economic hardship? What shape does photo and video content creation take during a cost-of-living crisis, when more and more people are cut off from the lifestyle flaunted by luxury endorsers? And how will brands, agencies and designers themselves move in this ever-changing landscape?
“When Black Friday came, I didn’t offer any discounts,” recalls 25-year-old New Yorker Sophie Wood, who has been creating fashion, beauty and lifestyle content since 2015 and has more than 59,000 followers on her Instagram and TikTok accounts. –. I think it’s a bit silly to encourage frivolous spending at a time like this when so many people are being laid off. And it just feels really insensitive to spend and show what I buy.” Wood, who has previously done promotional campaigns for companies like Urban Outfitters, Crocs, Hbo Max and Google, reveals how he has recently started working with ethical fashion brands and sustainable clothing that is “made to last. ” She also now posts fewer photos of gifts she receives from news outlets (“seems like I’m bragging”) and has even asked some companies to remove her from gift recipient lists.
Low Impact
While Wood has chosen to post content with greater sensitivity, the influencer has not yet seen a change in the companies’ advertising campaigns in light of the current situation. Across the ocean, Amy Zwirn, of the London marketing agency Influencer, explains that brands are becoming more selective about the talent they work with, favoring “trusted voices”. “Talking to your favorite designer in a moment of great uncertainty is very different from directly addressing brands”, underlines Zwirn, who believes that if the UK enters a recession, companies will gain consumer trust by relying on influencers able to act as long-term ambassadors, rather than ad hoc campaigns involving multiple content creators.
While the term “influencer” often conjures up the image of wealthy women on perpetual vacations, the reality is that it’s a broad industry, made up of people involved in cooking, cleaning, parenting, and expense management, who may be in demand by brands looking to connect with consumers. But what happens to luxury influencers like Millen in times like these?
According to Mae Karwowski, founder of the New York-based influencer marketing agency Obviously, the truth is that followers don’t necessarily want luxury influencers to show humility: “People like to look at luxury content as something to aspire to, as a ‘evasion; even if I can’t buy an Hermès bag, I still want to know more about how to get one – explains Karwowski -. I don’t think this phenomenon is destined to disappear”. Sales in the sector, on the other hand, appear unaffected by the crises: Hermès sales rose 24 percent globally in the third quarter of this year, while MoĂ«t said it was on the verge of running out of champagne. higher quality due to high demand.
Kenneth Lord, dean of East Michigan University’s College of Business and an expert on celebrity endorsement deals, argues that the most prestigious brands are more concerned with “defending the image of luxury” than with any perceived insensitivity from “anyone who doesn’t part of their business”. Lord spent some time estimating the cost of the dresses and accessories Millen showed off in the video of her getting ready to go to the Savoy. The figure “amounts to $38826.57. So it is clear that she is not aimed at the groups most affected by the crisis”. Lord believes that followers who aspire to become like Millen will hardly feel offended by her life choices: “Those who follow her because they actually rely on her shopping advice he has so much money to burn that he won’t be bothered by her going to the Savoy to escape a temporary failure in the heating.”
However, Lord believes consumers in general may be less impressionable in the coming months. In researching him, he distinguishes between “informational” and “transformational” purposes in customer reactions to celebrity endorsements. Lord found that people with the first type of motivation consider the practical risks of a purchase, while those with a transformational orientation focus on their mental or social state. This means that the former evaluate the promotion of a famous testimonial based on her reliability and competence, while the latter are influenced by the attractiveness and emotional appeal triggered by the testimonial. Lord theorizes that worsening economic conditions may force more consumers to be motivated by informational purposes. This could impact the overall effectiveness of influencer marketing (or, as Zwirn speculated, lead to a greater emphasis on trustworthy influencers). “Having said this – adds Lord –, the market is never homogeneous. Even in times of economic crisis, not everyone will be motivated exclusively by the search for information”.
Social Media Reactions
Karwowski explains that he doesn’t see luxury “as a sector of the economy that will be affected” by the crisis, even if he thinks that some influencers will begin to be more careful in their purchases and express greater gratitude towards their followers. “If I’m watching something that inspires me and I still can’t afford those things, I want to know that the person I’m watching is a good person and understands how lucky she is to be able to do what she does.” While those who spend large sums on luxury products will continue to do so, the growing popularity of TikTok – where content spreads like wildfire and does not remain isolated as on Instagram – will inevitably lead to other reactions.
Millen isn’t the only influencer to have drawn the ire of the internet in recent months. In early November, lifestyle influencer Tara Lynn was criticized for spending ten thousand dollars on two tickets to a Harry Styles concert, while in September, beauty influencer Mikayla Nogueira was mocked over an old video complaining about the difficulty of their business, having “literally just finished work” at five in the afternoon.
Millen did not respond to Wired UK’s request for comment, but she has posted more videos on TikTok since the Savoy. In her first, she asks her audience to recommend whether to wear a dress costing more than two thousand euros or a similarly priced two-piece to go to the theatre. While some commenters continued to tease her in the comments on her video, many others defended her: “She’s a content creator about luxury, why is everyone mad at her?” she wrote a follower; “She IS a luxury influencer but people are mad that she shows off her luxury lifestyle…get over it,” commented another. A few videos later, Millen shows “six cashmere and silk outfits for winter” and almost all of her comments are positive.
This article is originally published on wired.it