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Defining Luxury in Current Economic Conditions
Posted: December 23, 2008
According to Euromonitor International's latest strategy briefing, “How Vulnerable is Luxury to a Cold Climate?,” the drivers for luxury have not changed, but the items signifying luxury are constantly evolving. This dynamic, paired with increased wealth and the desire to spend on must-have luxury goods, is contributing to growth in both luxury goods and experiences.
In its most basic definition, luxury refers to “non-essential” goods. “Luxury has always been a relative concept, but there is no doubt that luxury has gone more mass market in recent years,” says Gina Westbrook, Research Manager at Euromonitor International. “To date, luxury sales have remained resilient, but much of that moving forward will involve a complex combination of trading up and trading down.”
The report reviews four segments of luxury marketing:
- True luxury: for the ultra-rich—custom cars, jets, haute couture, etc. When money is no object, exclusivity may be more important than price;
- Traditional luxury: fragrances, fashion and jewelery, premium spirits and champagne;
- Modern luxury living: the latest trends that offer status and appeal—such as travel, technology, tech trinkets, online spending, experience and services, and time;
- Life's little luxuries: often repositioned as small treats in sectors where luxury ranges have been developed for the mass market.