Luxury expert Daniel Langer looks at why the luxury market may soon see crisis on the horizon
What is luxury? This is a most elusive question because while some may associate luxury with stratospheric price tags or avant-garde design, the meaning remains ambiguous and seems to change from one brand narrative to another.
In this foggy landscape, the term “luxury” may be suffering from an identity crisis, and are often substituted by safer labels with words like “premium”. In the best-selling Luxury Marketing and Management (2011), the author of this column already noted 10 years ago that luxury is probably one of the most overused terms—yet almost everyone understands it to be something different.
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The price fallacy
The temptation to equate luxury with astronomical prices is an alluring shortcut. Certainly, iconic brands like Hermès can effortlessly command five—and even six—digit sums for their handcrafted Birkin bags. Ferrari is able to revv up so much desire—despite its price points—that clients might wait for years to get hold of a model. And Zegna selects—for their best clients once a year—the best fabric money can buy and tailor make an entire suit by hand, at price points that are out of reach to most.
However, this does not reveal the whole story. While a lofty price tag may be the most observable feature, it falls short of capturing the full scope of what luxury constitutes. Moreover, it offers little managerial guidance on how to create an authentic luxury brand.
Logomania: A symbol or a story?
Another realm of debate centers on the visual embodiment of a brand—its logo. While some opine that an overload of flashy logos detracts from the essence of luxury, this stands as an arbitrary judgment at best.
The aesthetic preferences of consumers vary, and what some may view as ostentatious, others may see as an elegant emblem of affluence. Every time stealth luxury was trending, logomania followed closely.
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