Too much of a good thing is bad
The luxury world is a very distinct cultural place and market. Defined by the high quality of the goods, but even more by the steep prices, the luxury movers and shakers of the world make it hard to gain access to their world.
Historically, the luxury market has always had a rather steady flow. Even in times when others markets have suffered by going down, or went extremely high due to economic prosperity, the luxury market has maintained its level, featuring an overall continuous growth. The reason for this is quite clear: the luxury market is a defined sector that is separate from many elements. People who buy luxury products are not very affected by the ups and downs of certain industries, unless there is a big boom or crash. Also, the concept of “the rich are getting richer” is one of the causes why the luxury market is expanding.
As we are now at the beginning of 2017 looking ahead to a rather unclear time – most futurists and trend forecasters don’t know what to make of it – the luxury market finds itself in a rather unique position. On the one hand, it will maintain its status of being unreachable by the masses, but on the other hand, it needs to think of strategies to go up, as many more people today can afford luxury goods. There are growing luxury markets in countries such as Russia, India and Brazil and luxury shopping is rapidly expanding in places like China, where new shopping centers are built and luxury shoppers are commuting in order to get the newest bags, jackets and shoes from Paris. Also, the fact that many people are making lots of money from online retailing and other similar sources adds to the expansion of possible luxury customers.
And, while for most industries it is a great sign that the overall industry is booming, this can prove itself to be quite a downer for some luxury brands and consumers.
As more and more people can afford luxury goods – from bags and shoes to watches and cars, the concept of luxury could be soon redefined. One of the main traits of luxury is that it is not accessible to many people, and, if more and more people can access it, it isn’t luxury anymore.
Therefore, in the next years, the luxury sector might have to come up with bigger and bolder products and experiences. This way, there will be a new segment of luxury shoppers created, or a bigger distancing between the new class of affordable luxury and exclusive luxury goods. One of the key words on which luxury brands might rely is the experience factor or the story factor. While the quality of the products cannot be very much increased (of course we will see lots of technological advances incorporated in clothes, but these will be rapidly adapted by the mainstream), the story of an item or the experience that will be associated with it will be what will define luxury. In other words, the person who makes the item, the person who designs it or the provenience of the materials themselves will be what will define luxury. That is not to say that the quality and branding will disappear. They will definitely remain and become bigger, but they will also have to work with these new concepts and incorporate them in the brand’s concept.
Digital matters
In recent years, luxury labels have not been very active digitally, featuring simple websites and low-key social media presences. And there’s a good reason for that. Online content these days is available to everyone and, offering the same experience to a luxury buyer as well as to a simple visitor makes the luxury experience less special. The weight of luxury lies in owning a product, not reading comments about it online.
In recent months, several brands have developed bigger social media strategies, as studies have shown that many people even buy luxury goods online, directly from their phones. These, however, are the so-called accessible luxuries, which again draws us to the line between accessible luxury and exclusive luxury. True exclusive luxury goods are bought as the result of an experience, not by tapping your phone in line at a counter. This is why it is most likely that there will be a strong break in the world of luxury in the years to come: on the one side, there will be the affordable luxuries, which will grow in diversity and size and on the one hand, there will be the exclusive luxury goods and experiences, which will grow in quality and also in price.
Luxury within itself is more of an experience: it is based on emotions, on the way one feels when wearing, driving or experiencing something. It’s about being associated with a set of values and concepts. And that is not going to change any time soon.
Fraquoh and Franchomme
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