Comments on: The new face of luxury http://blog.thefuturescompany.com/2009/09/21/the-new-face-of-luxury/ Bite-size thoughts from HCHLV people about trends, futures and cultural change to provoke and entertain Wed, 07 Jul 2010 13:40:44 +0000 hourly 1 http://wordpress.com/ By: The Luxury Linens Expert http://blog.thefuturescompany.com/2009/09/21/the-new-face-of-luxury/#comment-436 The Luxury Linens Expert Mon, 19 Oct 2009 15:38:35 +0000 http://blog.thefuturescompany.com/?p=1239#comment-436 The question is what really is luxury? It’s anything coming at a premium price compared to mass market products or services. Luxury markets have been growing exponentially in the past decades together with the wealth/GDP of all Western and Far Eastern countries. We have seen a worldwide proliferation of “self assessed” luxury brands like never before. It happened in any kind of Industry, from pet food to sportswear, from shoes to fine linens. Overcrowded and supercompetitive markets moved businesses focus from the product itself to marketing. The one able to scream its message louder stood out of the crowd and won the consumer. Marketing counted up to 80% of the price tag. A lot of sizzle and no steak! That’s the way it used to be! Tha global downturn that slashed US economy into the worst recession since 1929 was not only evil. Strange as it seems there is also a good side of it. The Great recession brought people back to reality, easy and quick money was over and the idea of an eternal growth at the same pace as the past decades has been replaced by the concept of sustainable growth. This changed consumer attitude forever. Focus is back again on the value of actual product. A brand name alone is not enough anymore to justify a premium price tag and luxury doesn’t mean just to show off wealth and social status accomplishment. New Luxury stands in a product’s superior key features that translate into actual benefits to the user. It’s that simple! The winner in today’s economy is the one able to deliver that luxury product to consumers in the most efficient/cost effective way leveraging the power of the internet and the new media. The internet make it possible to reach a target audience in a much more effective way than traditional advertising thus shortening the value chain and giving value back to consumers. Many traditional luxury brands still don’t get it. All that they do is making product more affordable by lowering quality thus not changing the way they deliver value. This is actually a runway to hell since poor quality will kill the perceived value of the brand itself in the long run. Only those businesses able to justify a premium price tag with real, tangible value will prosper and be the winners in the New luxury markets. All the others are condemned to decline and will strive to survive. New Luxury is good and is here to stay. No more sizzle please, just the steak ! The question is what really is luxury?

It’s anything coming at a premium price compared to mass market products or services.

Luxury markets have been growing exponentially in the past decades together with the wealth/GDP of all Western and Far Eastern countries. We have seen a worldwide proliferation of “self assessed” luxury brands like never before. It happened in any kind of Industry, from pet food to sportswear, from shoes to fine linens.

Overcrowded and supercompetitive markets moved businesses focus from the product itself to marketing. The one able to scream its message louder stood out of the crowd and won the consumer. Marketing counted up to 80% of the price tag. A lot of sizzle and no steak!

That’s the way it used to be!

Tha global downturn that slashed US economy into the worst recession since 1929 was not only evil. Strange as it seems there is also a good side of it. The Great recession brought people back to reality, easy and quick money was over and the idea of an eternal growth at the same pace as the past decades has been replaced by the concept of sustainable growth.

This changed consumer attitude forever. Focus is back again on the value of actual product.

A brand name alone is not enough anymore to justify a premium price tag and luxury doesn’t mean just to show off wealth and social status accomplishment.

New Luxury stands in a product’s superior key features that translate into actual benefits to the user. It’s that simple!

The winner in today’s economy is the one able to deliver that luxury product to consumers in the most efficient/cost effective way leveraging the power of the internet and the new media. The internet make it possible to reach a target audience in a much more effective way than traditional advertising thus shortening the value chain and giving value back to consumers.

Many traditional luxury brands still don’t get it. All that they do is making product more affordable by lowering quality thus not changing the way they deliver value. This is actually a runway to hell since poor quality will kill the perceived value of the brand itself in the long run.

Only those businesses able to justify a premium price tag with real, tangible value will prosper and be the winners in the New luxury markets. All the others are condemned to decline and will strive to survive.

New Luxury is good and is here to stay.

No more sizzle please, just the steak !

]]> By: Andy Stubbings http://blog.thefuturescompany.com/2009/09/21/the-new-face-of-luxury/#comment-413 Andy Stubbings Tue, 22 Sep 2009 17:34:38 +0000 http://blog.thefuturescompany.com/?p=1239#comment-413 Leafing through a couple of Taschen art books on fashion in the 1970s and advertising in the '80s, it definitely does seem that luxury is stuck in the past, or at the very least that the visuals and symbols with it are. This sort of ad for London Fog (http://smashstyle.net/wp-content/uploads/2009/07/gisele-bundchen-london-fog-ad-campaign.jpg) is basically the same as the sort of ads that you find in a 1970s Vanity Fair magazine: pouting, aloof celebrity flaunts object in a quasi-coquettish manner, all in classic airbrushed tones. Luxury has become so out of touch with reality that it has become kitsch - the furthest extreme of this might be Diesel's self-consciously ridiculous Fuel For Life campaign. You see this when you try and compile a mood-board of images, a sort of first-blush semiotic decoder of luxury if you will. The symbols of the traditional concept of luxury that first come to people's minds - a Ferrari car, a Tiffany ring, a secluded Caribbean island - seem a little dated and almost a bit ridiculous, at least in the UK. When we asked a little further, we found that people around the office have a far more disparate and personal view of luxury, from taking a taxi to freshly ironed clothes to personal goose down pillows (I won't mention who that was...) This takes me to a second point - these examples of "everyday luxury", as you term it, Emily, are much more diverse and individual than previous icons of luxury. They also put more emphasis on an experience rather than material acquisition of luxury (this is in-line with a long-term trend we have been monitoring in which consumers say they are as willing to spend money on experiences as material goods). My provocation is this: can a traditional, well-known, large luxury brand like Rolex really deliver luxury in the form of personal, intangible experiences through what is essentially a mass produced product? Or to put it another way, how do you scale experience? Leafing through a couple of Taschen art books on fashion in the 1970s and advertising in the ’80s, it definitely does seem that luxury is stuck in the past, or at the very least that the visuals and symbols with it are. This sort of ad for London Fog (http://smashstyle.net/wp-content/uploads/2009/07/gisele-bundchen-london-fog-ad-campaign.jpg) is basically the same as the sort of ads that you find in a 1970s Vanity Fair magazine: pouting, aloof celebrity flaunts object in a quasi-coquettish manner, all in classic airbrushed tones. Luxury has become so out of touch with reality that it has become kitsch – the furthest extreme of this might be Diesel’s self-consciously ridiculous Fuel For Life campaign. You see this when you try and compile a mood-board of images, a sort of first-blush semiotic decoder of luxury if you will. The symbols of the traditional concept of luxury that first come to people’s minds – a Ferrari car, a Tiffany ring, a secluded Caribbean island – seem a little dated and almost a bit ridiculous, at least in the UK. When we asked a little further, we found that people around the office have a far more disparate and personal view of luxury, from taking a taxi to freshly ironed clothes to personal goose down pillows (I won’t mention who that was…)
This takes me to a second point – these examples of “everyday luxury”, as you term it, Emily, are much more diverse and individual than previous icons of luxury. They also put more emphasis on an experience rather than material acquisition of luxury (this is in-line with a long-term trend we have been monitoring in which consumers say they are as willing to spend money on experiences as material goods). My provocation is this: can a traditional, well-known, large luxury brand like Rolex really deliver luxury in the form of personal, intangible experiences through what is essentially a mass produced product? Or to put it another way, how do you scale experience?

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