white paper The Nature of Luxury: Dispelling the Myths
Why “luxury” as a commodity is so confusing
Six myths of luxury — what it is and what it’s not
How understandin g the nature of luxury will help build margins and differentiate products and services Five really useful tips on how to use the concept of luxury for fun and profit
Marketers today are increasingly focusing on the “luxury” market, as if it were an identifiable, affluent orgasm that spews money on high design and extravagance. While this may be the behavior of some affluent consumers, it is a very limited view of what luxury is and where it belongs. Luxury is, as this paper discusses, an excess that is not necessary, and therefore can be the lynch pin of marketing strategies across all economic segments. What is luxury and why does the answer matter?
The second part of the question is easy to answer: it matters because luxury adds value to any proposition, and hence an important component of just about any business. But what it is, is somewhat more complicated. I Googled "definition of luxury", which returned 330,000 entries. After reading the top 175,230 entries, I realized that the subject needed to be revisited in a more useful way. Having spent twenty years understanding consumers and how they relate to the world around them, especially the stuff they buy, use and experience, I have developed a universal definition of "luxury" and hence a way of applying the idea of luxury at almost every level of experience of almost any product in almost any category. To understand this a little better, let's examine some of the myths of luxury. But first, the underlying fallacy of the modern approach to luxury marketing. Underlying fallacy
Most discussions about luxury end up being discussions about luxury things ‐‐ when Isadore Sharp of Four Seasons defines luxury he is defining "luxury experiences," and generally from the perspective of hotels (more
on this later). It is important to understand that the word "luxury" derives from the Latin "luxus", which means "excess". The adjective, which is what we generally define (very often in narrow contexts), simply describes the object as "in excess" ‐‐ a luxury brand, then, would be a brand that (to give the marketers their due) promises excess. Fifteen years ago, I introduced the notion of luxury as "waste." Again, simply put, luxury is anything that is not necessary, and anything that is necessary is not luxury. This helps explain why a hot bath to relax in the evening after a tiring day is a luxury, while a hot bath to get clean in the morning is not a luxury. Similarly, time is seen as the greatest luxury when we have extra time available to do something that is not essential, but it is certainly not a luxury when we have extra time because we are kept waiting at the dentist. The most significant point, of course, is that in this definition of luxury we see that the object is not, in most cases, luxury or luxurious, but the way it is experienced may (or may not) be luxurious. As we know, one man's stale coffee is another man's added value in a no‐frills hotel. One of the most important implications of this is that the customer has to know that what he
A discussion about luxury and what it is: this article will help service providers, innovators and designers add "luxury" elements to their...