When the question, 'What is luxury?' was posed to several people, including professionals in the branding and luxury goods fields, their answers included intangible qualities such as time, family, health and well-being, rest, travel, peace, essence, desire and substance. Others say that luxury is a dream and this dream mainly comprises of intangible qualities that are lacking in consumers' lives. Yet others insist that luxury is now a question of personal perspective. These answers reflect two things. The first is that there is a change in the definition of what constitutes luxury for several consumers. The second is that the interpretation of luxury is now completely individual. The reasons for these changing definitions of luxury are fairly obvious.
The first reason is that consumers of the present generation have access to more wealth. They are much more likely to attain career success and wealth at early ages compared to their counterparts of previous generations. This is mainly as a result of the expansion of the corporate and business sectors due to global economic and technological advancement, which have created wealth acquisition avenues. The same group of consumers are also working more as a result of increased responsibilities. The implications include stress, chaos, lack of time, health problems and all the negative associations that come with being busy all the time. These effects are most evident among the group of consumers known as Young Urban Professionals (YUPs), High NetWorth Individuals and Career Women with families. These groups of consumers desire an escape route from their chaotic lifestyles. As a result, they have come to perceive luxury as the intangible substances that they wish to have in their lives, such as simplicity, time, well-being, de-stressing services, freedom, space and peace of mind. Other notions of luxury by this group are elements that add true meaning, value and happiness to their lives, such as family, friends, community and charity work. These intangible qualities have become aspirations in the same manner that physical luxury goods remain aspirational goods for a large segment of the consumer population.
At the same time, luxury consumers desire innovative and inspiring luxury products to enable them to feel dynamic and alive. They view luxury as not necessarily the most expensive or the most lavish products, but the best that suits each individual and their outlook on life. Some wealthy luxury consumers also view luxury products like fine jewellery, well-crafted timepieces and fast cars as conspicuous wastes. However, in general, the current luxury consumers use luxury products and services as sentimental and expressive tools. Consequently the luxury brand offering should offer an appropriate balance between the need levels of tangible and intangible benefits.
In addition to the intangible qualities that consumers currently relate to luxury, ethical and socially responsible practices are now linked with luxury brands. Current luxury fashion consumers have become morally conscious in addition to being intelligent and socially aware. These consumers are extending associated ethical practices to every aspect of their lifestyles, from the consumption of organic food, to the use of carbon-neutral products. They now read the labels on their clothes and are interested in the sources of the materials of luxury products and also the conditions under which they were manufactured. They expect the luxury brands that they endorse to show visible ethical practices and social responsibility. This factor has become an important strategic requirement for competitive advantage in the luxury market. For example, in 2005 the musician Bono, his wife Ali Hewson and New York designer Rogan Gregory, launched a socially conscious apparel brand called Edun. This fashion brand is based on the concept of fair trade and employment. The clothes are manufactured with only organic materials. Another fashion designer following this concept is Linda Loudermilk, who has an 'ecoluxury' apparel line made from organic and sustainable fabrics. The impressive consumer responses to these products and brands imply the high ethical value of luxury consumers.
One of the ways of effectively addressing the need of consumers for intangible qualities like purity and serenity is through extending a luxury brand's offering to include luxury services like hotels, restaurants and exclusive clubs. Luxury brands are reputed with appealing product attributes and these can be transferred to the service experience they offer consumers. For example, a consumer staying at the Palazzo Versace ought to experience an exceptional and rare service to fulfil their intangible needs.
In satisfying the intangible desires of consumers, it is important for luxury brands to emphasize their brand essence and integrity, irrespective of the product or service being offered. Also luxury brands need to readjust their practices to reflect the new luxury environment. This might include relinquishing certain old practices in favour of modern strategies that hold relevance for consumers. The new luxury requires creating the unexpected rather than the expected.
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