November 18, 2004
New Luxury Means Experience
Luxury retailers ought to be more concerned about their customer's total shopping experience than they are about the price of their goods, says Pam Danziger, owner of Unity Marketing and author of a new book Let Them Eat Cake: Marketing Luxury to the Masses. As more and more consumers feel they are purchasing "luxury," the word is far more democratized and is now defined by the consumer rather than the manufacturers of high-end items.
"Old luxury, where people are told something is exclusive, no longer attracts luxury buyers," she told an audience Nov. 17 in New York City as she previewed her book. This is a paradigm shift, she says, and those who market and sell in the luxury business should recognize the differences. "If companies don't adapt, they'll die," she says.
The new consumer-driven luxury market is about people who are buying to enhance their lives and not about consumers wanting to have more fine products. The upcoming decade, which in 2010 will follow the current decade of luxury, is going to be the "Decade of Experience," she predicts. Buyers will (and many already do) want to do things and enjoy the experience of buying something of high quality, regardless of price, which they will consider a "luxury."
This is already occurring, she notes, as affordable and mass luxury continues to define the current decade. Baby Boomers, who continue to drive the retail environment, are becoming empty nesters with no children at home. This is changing the focus of high-end buying from the home and family to the individual. Danziger offers these tips for those who market luxury:
U.S. consumers value a more democratic version of luxury. Exclusive is not attractive; special is.
Buyers already expect quality. Sellers need to add value. If you triple the value, you can double the price. For jewelers, "to have a $2,000 ring, first create a $3,000 ring."
Luxury buyers seek a memorable experience.
Luxury shoppers are still looking for a bargain.
These buyers are invested in their lifestyles and don't take risks that will jeopardize that.
Luxury brands only justify the purchase, they don't attract the buyer.
by Michael Thompson