Let me start by apologizing to anyone who is expecting a definitive list of principles that define luxury. This post may leave you with more questions than answers. I ended the year 2014 with a few posts devoted to the very question of what luxury is. It seems I’m still on the same track now that the new year has arrived.
I just finished reading a recent LinkedIn post by Alan Crean, a self-described Subject Matter Expert in Professional Services Automation. The post is titled “Luxury Brands as a Professional Services Market.” It begins with a succinct summation of the luxury question I’ve been pondering. According to Crean:
There is no official definition of what constitutes a ‘luxury good.’
Well, now that that’s settled, we can move on. Since Crean looks at luxury from a business model perspective, he provides some interesting figures and graphs of the global luxury marketplace (no spoiler here—European brands dominate the luxury goods sector). But midway through the post things get interesting. This is where Crean defines the three core principles of luxury advertising. If you read through Crean’s entire post, you may pick up some clues regarding his general opinion of luxury goods, but here’s a quote that may give you some insight:
The issue goes back to the real value of the product – if I had to explain to you why I need to pay $1,000 for a shirt, I can not see what reason that would make sense to anyone reading this.
It’s possible sentiments such as this may have colored Crean’s description of the three core principles of luxury advertising. I don’t disagree with everything Crean says, yet I feel his descriptions are more stereotypical than accurate. And, in my humble opinion, when you’re dealing with luxury, accuracy and distinction are very important indeed!
Below are Creane’s definitions of the three core values of luxury advertising, each one followed by my own comments:
(Crean) Fantasy and not reality: Luxury brands are exclusively marketed through messages meant to make the consumer dream of a different world where they are better, stronger, faster then (sic) everyone else – and the product represents that.
(Me) Fantasy and Beauty: I don’t deny luxury advertising can venture into the fantastical. Remember the glorious Cartier panther commercial?
But I’ve found the essence of the message is beauty. Exquisite colors, captivating locations, gorgeous fabrics, enchanting music, sumptuous appointments—all these offer an escape from the mundane into a world where life can be beautiful. Why can’t this be a reality? Check into the Four Seasons Hotel George V in Paris where luxury is very, very real.
(Crean) Emotion and not reason: Luxury goods are completely illogical. The marketing is based on driving emotional experiences based on circumstances and environments that do not really exist.
(Me) Emotion and Value: I used to hear that luxury goods are not based on need, but on desire. I no longer fully agree with that statement, and definitely don’t concede that luxury goods are illogical. I may need to buy a new watch. Should I decide to purchase a Rolex over a Timex, it may be for some very logical reasons, such as superior craftsmanship, quality reputation, exceptional customer service, elegant design, better durability, etc. Even the cachet the brand offers may enable me to impress a client and close a sale. These are all valid (and perfectly logical) reasons for choosing a luxury product.
(Crean) Yearning and not satisfaction: The messaging goal is to make consumers desire the product as opposed to general mass marketing which focuses on solving problems and achieving outcomes from ownership.
(Me) Yearning and Ultimate Satisfaction: I can’t think of any product—luxury or not–whose advertising department doesn’t want to make consumers desire their product whether it be a breakfast cereal or a diamond necklace. Just listen to Don Draper pitch ketchup:
True, there are aspirational buyers who can’t afford to lay out $60,000 for an Hermès bag and so will settle for an Hermès belt. But there must be some level of satisfaction with the product, and with the brand, or the yearning will turn to resentment. In my experience, it’s the luxury brands that typically score the highest scores in customer satisfaction. It’s why the Ritz-Carlton takes the No. 1 spot on the ACSI (American Customer satisfaction Index) list of hotel chains year after year.
Going back to Mr. Creane’s dilemma of trying to explain why he needs a $1000 shirt, perhaps he doesn’t need one. But any salesperson worth his or her high-priced salt (Amethyst Bamboo – $38.50 for a 1.2-ounce jar) should be able to explain the value of that $1,000 shirt to a potential customer.
P.S. For an interestingly similar article to the Creane post, check out “Luxury: The Business of Selling Dreams” by Duke Greenhill (Luxury Society, Sept. 9, 2012)