Searching High and Low for a New Value Proposition

When ad agency Moosylvania polled 1,500 Millennials on their favorite fashion brands, the results were a little, uh, mixed. Nike headed the list, but the top 15 also included lowbrow Target (at #2) and ultra chic Chanel (at #13). Would you pair a Chanel bag with a trench coat from Target? Apparently, plenty of Millennials would. Not only that, but within Target itself is a kind of high-low aesthetic that Millennials (and plenty of non-Millennials) can’t resist. Target’s capsule collections – which mash up hot designers with the store’s affordable ethos – have been huge hits. This summer’s Lilly Pulitzer collection sold out almost instantly at many locations, leaving shoppers sundress-less and sad. What’s behind the “high-low” trend? Instead of sticking to the middle ground, many consumers now prefer to shop the runways one day and Wal-Mart aisles the next. At issue is the notion of value. True luxury like Chanel – or premium electric cars by Tesla or pricey gadgets from Apple – balances out democratic choices like Converse shoes, trendy but disposable clothing from Forever 21, or functional quality from brands like Under Armour. Do these principles apply to financial institutions? Perhaps. Let’s unpack:
  • Basic values are back. Can you offer high-quality, basic products and services that are affordable – or free? That’s a win.
  • Cheap isn’t cute. While value-priced brands are having a moment (think Topshop or H&M), being cheap at any cost is a losing proposition. High-low consumers place a high value. In order to get there, you need quality.
  • Capturing the cachet. Do you have technology no one else has – for instance, real-time P2P payments or a card control app? Do you offer ultra-premium deals on mortgages, insanely favorable rates and terms on credit cards, or concierge auto buying services? Alternatively, are you the financial institution that treats your community like gold? Being the ne plus ultra is definitely the best.
  • Fair to middling is the new poor. On the other hand, there seems to be less and less value to being midrange. Are you the middle ground between expensive banks and DIY alternatives like check-cashing services? Reposition yourself, please. Value-oriented basics and ultra-cool perks get premium attention.
Meanwhile, give yourself bonus points if you can span both high and low. When the term “affordable luxury” maintains its oxymoronic edge – being both cheap and chic, rather than a tepid blend of both – alchemy ensues. Just ask Lilly Pulitzer.