From Conspicuous to Conscious Consumption: Redesigning the Meaning of Luxury
On the plus side is the Wall Street Journal. In the 03/08/2010 article entitled The Ten Best Places For Second Homes, Steven M. Sears declared, "At long last, the market for luxury real estate is coming back to life. Prices for primary residences, which plunged at least 20% from the peak in 2007, appear to have bottomed. In some of the snappiest locations, scattered bidding wars are breaking out and prices are turning upward. In Greenwich, Conn., realty brokers say, the final months of 2009 were almost record-setters for sales volume, as two years of pent-up demand was unleashed."
Also pertinent are data in the newest Wealth Report (3/15/10), with inferences that seem promising: "Retail chains post a 3.7% increase in February comps, with luxury outperforming the overall group. Consumers are again indulging in luxury purchases."
Could this mean that the 2009 severe recession earthquake is behind us? Well, hopefully. But it's necessary to remember the concept of false positives. In medicine, economics, statistics, pregnancy tests and LIFE, they are results that look good but, after the dust settles, may not yield the results originally expected. Consistently valid results take time. So with the shoots of hope within the numbers above, there is still room/time for questioning. We receive clearer pictures as time goes on, understanding that hope should be tempered by the economic history of the recent past.
Maybe the consensus of philosophers and economists were right – that it takes trauma to change minds and actions, and because of this unexpected economic jolt, what has also changed over the past 18 or more months is an unexpected evolution in the definitions and dimensions of luxury.
Those of us who work in the luxury field, whether it is in luxury hospitality, hotels, journalism, marketing or PR have noticed a movement from objectifying to personalizing the meaning of luxury. We learn, again, this idea is neither changeless nor timeless, nor above the fray as once thought, but scalable and adaptive to present cultural and economic norms. The vocabularies and definitions of the luxury space are moving away from model of conspicuous consumption – a lot of cars, watches, diamonds, to a softer version, one that is evolving toward a more conscious consumption, involving family, philanthropy, authenticity, and the awareness of the scarcity and primacy of time.
"I have strongly recommended to my clients not even to the use the word luxury. It has become so overused. For some projects we have worked on, we actually went through the press releases to soften the word or remove It.," says Linda Bruno, Managing Director for Consultare, a consultancy group for the luxury hotel industry. And so it has. Loew's Hotels have removed the word "resort" from their hotel names, as this word certainly infers luxury.
This type of softening and removing might not have been as much of an option a year ago as it is now. But it is a change sign that points in many directions. One is toward print media. In the Pre- Madoff/upwardly mobile world, it could be argued that luxury was defined by high end magazines editorializing as to what to buy, where to go and what to wear. But now – many luxury print publications have passed on into the great ash heap of irrelevance: Executive Living, Executive Decision, Ocean Drive, Trump, Trump World, Ascent, Distinction, Elegant Bride, the list goes on. According to www.foliomag.com, ad sales in recent months have faltered consistently in many of the high end shelter magazines. And on March 13, 2010, in the New York Times' section Popular Demand, grim ad page numbers in NYT's tell an interesting, though derivative story: T&L (Travel & Leisure) down 37%; Food & Wine down 30%; but Bon Appetit up 13%. What can be inferred here? That people are not as interested now in travel as much as staying home and trying out expensive recipes? Maybe so. Read on!
In one of the last issues of Portfolio, another magazine that has stopped publishing, an article was written by a TARP wife, a woman whose luxurious lifestyle was underscored for years by her wealthy banker husband, whose bank has been given billions in bailout money. Understandably, she prefers to remain anonymous. Her essay, deals with how the meaning of luxury has changed for her: " I haven't even looked at spring clothes. Keeping up with fashion seems somehow decadent in this new era, like getting Botox injections or catered dinners." How does she see her life now? In addition to turning down invitations to gala events where they will be asked for donations they don't have extra dollars for anymore, they eat out less frequently, she has to actually cook, stay home and watch TV. This is what defines her life -- a life, she says, of relative luxury. This means her house is not in foreclosure, and they can still afford things they need. Her social definitions, and carrying it further, our cultural definitions of luxury are evolving into different dimensions: authenticity, honesty, transparency, genuineness, grace, conservation, and a mindfulness of brand and product. These have begun to replace the old words of luxurious, extravagant, decadent, lavish, elite, one of a kind, dreamlike. The luxury experience used to mean selling the dream, but now it is in process of becoming more an offer – to obtain a transformative experience of awareness, of eco-sensitivity, of education, perhaps a green experience, or, one of philanthropic substance and consequence – something that changes a person from the inside out, not vice versa.
The Wealth Report, quoted earlier, explains this idea with great precision:
"The onslaught of the economic recession and the inevitable changes in customer values and behaviors in 2008 and 2009 caused luxury brands to embrace the concept of customer-centric, data-driven marketing. IN 2010, marketing and communications dollars are being reallocated to more measurable and highly profitable customer centric initiatives... Gone are the days of the 10 page insert in Vogue, the $25.00 direct mail piece, and the broadcast email campaign with flashy photography and no specific call to action.... Luxury brands are now looking to understand their customers, and adapt their marketing strategies to best serve their interests."
There are some companies -- both in vacation and in retail areas -- that get this, and have changed their marketing and sales messaging to reflect this growing awareness – one that has done this exceptionally well is Exclusive Resorts, the largest and best- known Destination Club now in existence, with -- as mentioned in an earlier Luxist column ----a 2B Real estate portfolio and over 3000 members. Their online and print advertising define luxury, not as acquisition of stuff, but through the scarcity, of time. Time with children before they grow up, time with grandparents so children will remember, time that can be crafted into significant memories. These ideas define new meanings of luxury, especially from a human development perspective.
Abercrombie & Kent Residence Club, a dimension of the famed tour operator Abercrombie & Kent, also has the ability to carry their members to places that will create eco -sensitive, educational memories. Other companies, Exquisite Safaris being the major one, takes their clients to areas in Africa where they can come to know the villagers on a personal level, and create a strong understanding of their needs, allowing new forms of philanthropy to ensue.
And in the retail realm, the vision of the customer being an anonymous buying machine to a living breathing person, important enough to define a major component in the future success of the company is what the newer CRM (Customer Relationship Management) data collection methods are all about.
It is in a business's best interest to know how you feel when you buy, what attracts you, how you feel after you buy, and the like. It is also how the salesperson who serves you is dressed, how he or she treats you, what is said, how you are allowed to feel.... it is every detail of the experience that defines and differentiates the retail successes in the luxury space. According to a recent study, two brands that scored well in all these dimensions were the British fashion house, Burberry, and the French luxury house, Louis Vuitton.
Luxury is now being redefined and reaffirmed not in terms of how much but of how well, not in terms of artifice, but of authenticity, thereby beginning to redress the older, more static ideas of how life should be lived, what and how certain objects should be purchased, and how legacies and memories can be best created and maintained.