Opinion: How AI is disrupting the luxury experience

At this moment, there are hardly any discussions I have with luxury brands where artificial intelligence (AI) is not a critical topic. AI stands at the forefront of the next major revolution in luxury, promising to redefine the boundaries between technology and human craftsmanship. As luxury brands navigate this new reality, the central question becomes not just how AI can be integrated into the luxury creation process and the client experience, but how it can be done in a way that enhances rather than diminishes the human touch that lies at the heart of luxury. The emerging role of AI in luxury The potential of AI to transform the luxury sector is dramatic, ranging from personalized shopping experiences to operational efficiencies in supply chain management. Predictive algorithms can tailor product recommendations with high accuracy, while AI-powered chatbots and virtual assistants provide a level of customer service that is both efficient and scalable, far beyond the often-annoying realities of today. Behind the scenes, AI-driven analytics offer insights into consumer behavior, enabling brands to anticipate market trends and respond with agility. And a lot of luxury brands are experimenting with integrating AI into the creative process, which has proven to be both an opportunity and a challenge. For instance, Zegna introduced an AI-powered customization tool, Zegna X, demonstrating AI’s ability to enhance customer experience and personalization. Kering-owned fashion marketplace KNXT’s AI-powered shopping assistant “/madeline,” which is powered by OpenAI’s ChatGPT, promises an easier way to find relevant products across different Kering brands. Meanwhile, Prada’s Reveal Foundation shows how AI can personalize the luxury experience by utilizing an algorithm to scan 3,000 different skin tones for shade optimization. Yet, these innovations come with the need for balance. Although AI offers new avenues for creativity and efficiency, maintaining the human touch is essential to luxury’s appeal. This is because the essence of luxury lies in storytelling, exclusivity, craftsmanship, and personal touch — a relationship between brand and consumer that is deeply human. The task, then, is to leverage AI in a way that amplifies these qualities rather than undermining them. It will be critical for brands to use AI as a catalyst for the human experience and not as a replacement. Preparing for the shift For luxury brands, preparing for the AI revolution means investing in technology while staying true to the ethos of luxury. This involves a dual approach: on one hand, developing AI capabilities that enhance personalization, efficiency, and insight; on the other, ensuring that these technologies are deployed in a way that enriches the brand’s narrative and human-to-human customer experience. Training AI systems to understand and replicate the nuances of luxury service requires a significant investment in data and machine learning. Brands must also cultivate digital talent that can bridge the gap between technology and luxury — a new breed of creatives who can translate the brand’s heritage and craftsmanship into the digital realm. Maintaining the human touch The key to maintaining the human touch in an AI-driven world lies in the concept of “augmented luxury,” where AI enhances human service rather than replacing it. For instance, while AI can predict a customer’s preferences, the final touch, personal note, and bespoke recommendation should come from a human, imbued with empathy and understanding that AI cannot replicate. Moreover, storytelling becomes even more critical in an AI-driven context. Luxury brands must use technology to tell their stories in new and compelling ways, creating immersive experiences that blend the digital with the physical. AI can bring a brand’s heritage to life, but it’s the human element — the artisans behind the product, the personal interactions with staff — that truly connects consumers to the luxury experience. AI can bring a brand’s heritage to life, but it’s the human element — the artisans behind the product, the personal interactions with staff — that truly connects consumers to the luxury experience. The challenge ahead As we stand on the brink of this AI-driven era in luxury, brands face a delicate balancing act. The challenge is to harness the power of AI to deliver unprecedented levels of personalization and efficiency while preserving the essence of luxury — the human touch that makes each experience unique and memorable. By integrating AI thoughtfully, luxury brands can not only adapt to the changing landscape but also redefine what luxury means in terms of service delivery. What is critical during this transition is to remember that luxury is about extreme value creation. Too many brands and organizations just embrace a new technology because everyone is doing it instead of asking themselves how they can create extreme value for their clients in a way that is unique to the brand. Luxury strategy, brand storytelling, and luxury training will remain critical for brands that want to create significant client value rather than dying in the sea of sameness. For luxury brands, opportunity and risks are never far apart. Choose wisely. This is an opinion piece by Daniel Langer, CEO of Équité, recognized as one of the “Global Top Five Luxury Key Opinion Leaders to Watch.” He serves as an executive professor of luxury strategy and pricing at Pepperdine University in Malibu and as a professor of luxury at NYU, New York. He’s authored best-selling books on luxury management in English and Chinese, and is a respected global keynote speaker. Daniel frequently conducts masterclasses on various luxury topics across all continents. He’s a sought-after luxury expert, appearing on platforms like Bloomberg TV, Forbes, The Economist, and more. Holding an MBA and a Ph.D. in luxury management, Daniel has received education from Harvard Business School. All opinions expressed in the column are his own and do not reflect the official position of Jing Daily. Follow him: LinkedIn: https://www.linkedin.com/in/drlanger, Instagram: @equitebrands /@drdaniellanger

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Opinion: How AI is disrupting the luxury experience