Luxury: Aspiring to a New Ideal

May 22, 2009 9:27 AM

By Mark Sutter, Chief Strategic Officer, The Halo Group

There has been a lot written lately about the death of Bling. Could the confluence of social, economic and political change finally be the consumer tipping point? Karl Lagerfeld noted a shift in global cultural values, calling it an “era of new modesty.” President Obama has called for a “new age of accountability.” Others have proclaimed that the age of consumerism is over and that emerging American values will forever change luxury brand marketing as we know it. Luxury marketers are being told that consumers are rejecting the trappings of wealth, and are instead reconnecting with family and friends, and joining a kinder, gentler, less conspicuous world of consumption. But is that really true?

It seems that with every recession we seem to get the same populist message: Luxury is dead. Restraint and simplicity will rein. According to Fortune magazine, Faith Popcorn, Chairman of BrainReserve, a consumer research firm, calls the phenomenon ‘cashing out’: less concern for material things and more emphasis on things money can’t buy. She sees it as symptomatic of “America’s fatigue with excess.” Funny thing is that quote was printed in 1990, nearly 20 years ago. Since then, three recessions have passed and arguably we have enjoyed one the most decadent luxury bull markets in American history.

So is Bling really dead? Or have we just come down with another mild case of affluenza? With each upswing, our aspirational culture proves the pundits wrong. The American capitalist culture can’t be shaken. The desire to acquire beautiful things is irrepressible.

Certainly, there’s no doubt that the way consumers value luxury brands is now under scrutiny, perhaps more so than ever before. But smart marketers have known for years that there has been a shift from conspicuous consumption to life enriching consumption.

Live Life Enriched

Consumers are aspiring to a new luxury ideal. They have become collectors of life experiences.
High-end hotels like The Ritz-Carlton have moved beyond service excellence to position themselves as global portals to new life-enriching experiences. Louis Vuitton luggage is a “worthy companion for life’s incredible journey,” and Tiffany helps you hold on to those moments that that matter most, capturing “The Story of Your Life” for all time. These are the aspirational qualities that consumers seek from luxury brands today.

All of these products offer more than status and prestige— they help consumers savor and celebrate life and connect them with the world around them. Product authenticity and craftsmanship help them tell their personal life stories. And socially responsible brands help them contribute to something larger than themselves. These brand qualities are timeless, and offer the lasting value consumers have come to expect from luxury today.

So while some in the industry are retreating or irrevocably tarnishing their brands, those that understand how to communicate the value of luxury to today’s consumers will survive, and perhaps even prosper in this downturn — emerging more powerful than ever before.

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