Redefining luxury

Changing markets In an age of second-hand luxury goods, and extensive digital presence, what is really luxurious? The word luxury conjured up a 007-style image in the post World War era. It was defined by exclusivity, and you were only accepted in the club if you could afford, and understand the value of, the best timepiece, the snazziest car, the poshest real estate, the priciest destinations to travel, and so on. Cut to the present. Thanks to the digital revolution, it isn’t very difficult to figure out what’s “in” in luxury if you can foot the bill, and thanks to the number of growing millionaires, luxury has become more accessible than ever before. At last count, according to a recent report published by the Beverly Hills tourism board, there were 1,99,235 Ultra High Net Worth Individuals, or those whose per capita income was above $30 million. If this demographic was further investigated according to their profile, 65 per cent of them defined their wealth as self-made, and only 19 per cent inherited their fortune, and 16 per cent inherited a part of it, which then they grew. Developing economies such as those of China, Middle East and India have been increasingly making their presence felt in the global luxury market, affecting the way luxury trends are headed. For instance, according to a Guardian report published in September 2014, luxury brands did poor business in China, the country which is responsible for over one-third of its sales. The downward spiral in global profits was reportedly a result of the sophisticated Chinese luxury consumer rejecting ostentatious western brands. Prada is slated to open 30 standalone stores in the next three years in Asia. Dolce and Gabbana, Berluti, Louis Vuitton, Alexander Mc Queen are some other luxury brands that have focussed solely on menswear only collections and stores. “Nowhere is this more evident than on Rodeo Drive, the Beverly Hills’ high street, and this sector isn’t a quiet extension of women’s fashion anymore. Designers are rising up to the challenge, since the industry is taking a different direction creatively, and that is of interest to them,” says Julie Wagner, CEO, Beverly Hills Conference and Visitors Bureau.

The overall global luxury market has exceeded $1.1 trillion, with the ultra high net worth controlling 3 per cent of the global infrastructure. It is difficult to identify singular trends in the luxury market worldwide, as this remains a highly individualistic market. While London’s increasingly super-rich millennials spend on clothes, goods and accessories priced at above £2,000, uber-rich Swiss residents of Zurich prefer to spend on investments such as art and automobiles, apart from skiing and yachting.

Going glocal

Overall, there is a growing interest in processes behind how bespoke products are made. The emerging popularity of pop-ups, especially in the food and fashion industries, are a response to this trend. Fashion brands thrive on innovation, and hence are particularly suited to pop-up retailing. Brands have started investing in technology that connects them in real time with their customers, and it will become more important to keep a loyal customer base happy than increasing their circle of influence, the report concludes. More brands are investing in customising experiences. For instance, Audi did a campaign where it allowed users to use touch-screens and customise its automobiles. The report suggests that the reason behind the popularity of luxury pop-ups is that people value their experiences as much as the acquisition of a physical product. The extra push that makes an experience unforgettable is a big part of the real estate luxury business as well. The hotel industry relies on brand collaborations across food, music, art, design, fashion and small businesses to introduce new experiences. New-age services such as keyless entry, online check-in and concierge services take advantage of technology to up the ante. “There are some hospitality brands that provide you with the luxury of switching off — going offline, by the virtue of being remotely located,” said Wagner. While this may be a horrifying possibility for some, no WiFi is actually an experience some people take as a luxury, an ability to bring their world back under control.”

Responsible luxury

With the growing influence of millennials, , the luxury sector is also taking an ethical turn. People are willing to pay extra to make sure the product or service they acquire is environmentally responsible, and even have a positive socio-economic and environmental impact. In keeping with this trend, slow fashion is where fashion industry has been heading. High-end providers are ensuring that their products are made with quality materials, valuing the heritage and narrative history behind its manufacture and conception. They are locally sourced to minimise environmental impact. Wagner said that brand fatigue has stepped in, “People care less and less about brands using glitzy labels, and all this has been replaced with a quieter face of luxury.” Normcore, or No-Go, trends subverting the style industry, where people want their clothes, accessories and environment to look as ‘normal’, or subtle as possible. Their superior design, quality of material used, and ethical vision of production are what makes them truly luxurious. Brands such as Manolo Blahnik, Marni, Tiffany, Monique Pean have already invested in eco fashion.    

Heritage, similarly, has acquired new worth, since having a connection to the past is considered a luxury. Hand-dying indigo threads, discovering old recipes, going back to vintage styles and emphasising on human contact over machine produced stuff — from handpicked teas to hand-stitched jeans — all use the past to inspire the future. Nowhere is this more visible than in the food industry. According to a study by the International Food Council, millennials are more aware of their food, and do not mind paying more for it as well. Customers are shelling out extra for locally-sourced, organic food, that has ideally been harvested recently, with all its nutrients intact.  

Ultimately, luxury is not going to be about the brightest jewel or the most ostentatious yacht. Luxury, is taking its cue from their grandfather and grandmother’s generation — looking for something with more meaning, something with a story behind it, labels be damned.

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