Luxury products evoke sense of myth and fascination. Maintaining the aura of luxury is a key driver of consumer behaviour. Superior quality and craftsmanship are at the heart of the luxury proposition and give sense to the pricing. The luxury sector invests heavily in industrial property in terms of creative inventions but also in relation to design and innovation.
Maintaining control of the distribution and retail of products, selective/exclusive distribution, is critical to the brand building and economic success.
According to Altagamma researches, the biggest markets for Personal Luxury Goods are in Europe and America, fast growth of chinese consumers increasing across regions.
As a business Luxury has to accept 3 modern concepts:
- Globalization (the access to luxury products and services from new cultures and markets)
- Democratization (customers have grown exponentially, making this industry more affordable without the loss of its value or vulgarity)
- Communication (the global mass media development have made us more aware of the diversity and cultural richness of our planet and many other ways of living)
European luxury brands account for over 70% of the worldwide luxury goods market.
Luxury as a Culture (French and Italian)
- The Comité Colbert is an association “to promote the concept of luxury.” The members are 81 French luxury brands. It was founded in 1954 by Jean-Jacques Guerlain
The luxury industry conveys culture and identity (French luxury companies). Their quest is to combine tradition and modernity, craftsmanship and creativity, history and innovation.
Word of reference:
- Art de vivre
The association is divided into thirteen métiers or trade sectors. The sectors are:
- Faience and Porcelain
- Fragrance and Cosmetic
- Gold and Precious Materials
- Haute Couture / Fashion
- Leather Goods
- Silver and Bronze
- Wine and Spirits
The association adopted its first automobile brand in Bugatti in July 2015.
- Design Furniture,
- Fashion Design,
- Fine Food,
Word of reference:
- La dolce vita
Luxury as a Customer
We always have to keep in mind about different attitudes and interests of customers in luxury industry. There are:
- fashion victims
- new seniors
- young generations
- HNWI – High-net-worth individual – is a term used by some segments of the financial services industry to designate persons whose investible assets (such as stocks and bonds) exceed a given amount. Typically, these individuals are defined as holding financial assets with a value greater than US$1 million. So called “old money”, requiring high life standards, making passion investments.
- Affluent consumers are an important target market for sellers of luxury goods. So called “new money”, requiring good life standards, making edonistic purchases.
- Mass consumer, only exceptional purchase, gift. Requiring aspirational life standards, making impulsive purchases.
WHAT LUXURY IS NOT (and should not be):
- an object
- completely replicable