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Understanding The Concept Of Luxury And How Brands Are Giving It New Meaning
Sectors & Markets
30 May, 2023
How can luxury be defined? The concept of luxury brands is a very controversial issue for the modern world of goods and services consumption. The reason why it is so difficult to define what luxury brands or products are is the confusion between major types of luxury products and concepts such as premium products.
Some people say that luxury is something very exclusive and desirable, that brings people status and it’s very selective, being available just for a few. The term luxury goods always comes along with other status words such as high prices, high quality, aesthetics, craftsmanship, innovation and rarity. Therefore, being the only product or service within a category. If we narrow our minds down only to think that the definition of luxury is based on these attributes, we only would find just a few brands within each category such as Hermès for leather goods, Rolls Royce for cars, Brioni for men’s suit, Van Cleef & Arpels for jewellery and so on. However, this is a very strict luxury concept and it is very restrictive, moreover it doesn’t really represent the term “luxury” nowadays. A luxury brand or product isn’t only represented by its uniqueness and exclusiveness, it also comes together with creativeness and the emotional value perceived by its consumers.
The luxury sector can be divided into different categories of activities such as: Ready-to Wear, category for women and men’s apparel including selective fashion brands such as Celine, Valentino and Chanel; Jewellery & Watches, where brands sell their items in very specific jewellers or in their own stores. Perfumes & Cosmetics sold in selective distribution channels; Fashion Accessories, in this category includes leather goods, handbags, shoes, belts, glasses, and among others; Wine & Spiritsare very expensive and sophisticated products, often gifts items and they are very distinctive from other beverages such as beer and soda. Automobiles, luxury cars are those very sophisticated with selective distribution and unique after-sales service; Hotels & Travel, it's all about experience and expectations, with an outstanding service and Private Banking, offering incredible service though a selective activity.
How should perceptions of luxury be measured? According to Danielle Alleres, author of L'empire du luxe, the luxury market can be divided into three different levels: Inaccessible, Intermediate and Accessible luxury.
The first level is the Inaccessible luxury that corresponds to absolute exclusivity and it can be perceived as supreme luxury. It is a very exclusive item, available for a very high price and for a very limited number of people, sometimes tailor-made or hand-made manufactured with prestigious materials and distributed through a very selective channel. For an Inaccessible luxury item it is all about heritage, creativity, creator’s fame and prestige. As an example of inaccessible luxury we can find brands such as Hermès, Roger Vivier and Bonamano & Ferrari as well as in the fashion field those who work with Haute Couture such as Dior.
The second level is the Intermediary Luxury that corresponds to an exclusive item, available for a limited number of people. These items are less scarce, less expensive and distributed through a less selective channel if compared to the fist level. An easy way to understand the difference between the levels is if you compare within the fashion industry Haute Couture and Ready-to-wear collections where the second one represents exactly this secondary level. Intermediate luxury brands are brands such as Fendi, Louis Vuitton, Versace and Prada.
The third level is the Accessible Luxury, which corresponds to a reachable prestige where products are made in a large quantity in factories or workshops for a wide range of customers. The distribution is larger on a mass scale but still gives to its customers the same luxury experience and emotion at the purchase time. As an example of accessible luxury we can find brands such as Swarovski, Furla or products such as Salvatore Ferragamo shoes, Giorgio Armani sunglasses and Chanel perfume.
The luxury concept is very vague and can’t really be accurately defined in only one term, it means different things to different people but it is always linked to prestige and status. Most of the people who usually purchase luxury items do it to achieve social reward and status. Nevertheless, the consumption of luxury products is by far not the only way to satisfy the need for prestige. There are non-luxury products that also allow consumers to enhance their prestige and here is where all the confusion begins.
Premium brands are those like Coach, Liu Jo, MaxMara, Marc Jacobs, Fred Perry and among others who aspire to be luxury and prestigious but they are perceived more as an affluent mass market or mass-luxury brands. Compared to luxury brands, premium brands are less ostentatious, more accessible but still available for a high price, more rational, it has a very effective supply chain and it sells its products through multiple distribution (mono brand stores, department stores, franchising and multibrands). We can make a comparison between Louis Vuitton and Michael Kors bags, despite their obvious common design features, Michael Kors products are perceived as premium because of its inferior material quality, mass fabrication and lack of original aesthetic sense, but still buying Michael Kors products brings prestige to some people.
All in all, since prestige isn’t only achieved by luxury brands the concept “luxury” and “premium” still gets very confusing in people’s minds. Real luxury is those products that are full with artistic content, it is a craftsmanship result and it makes usage of very unique and rare materials all to satisfy personal pleasure.
Cover Image: Roger Vivier March 2023, courtesy Roger Vivier Facebook page