The 2018 Monaco Symposium on Luxury
Luxury: The Art of Creating Emotions in a Fast Moving & Global World
IFG Luxury Attitude, management consultancy practician in area of Luxury was present in Monaco on April 12th and 13th, to attend this international Symposium, mixing academics and business people, that have a common interest the future of Luxury.
To introduce the first day topic on “Luxury: The Art of Creating Emotions in a Fast Moving & Global World”, Jean-Noël Kapferer made a statement “Without emotions there is no Luxury!”. It is obvious, that people that buy Luxury are impacted by emotions!
And what about Luxury defined by those who make Luxury?
B. Arnault, CEO LVMH “Luxury: items that serve little purpose in the lives of consumers except to fulfil dreams. And those dreams don’t come cheap”.
Ralph Lauren “I don’t design clothes, I design dreams”
In the case of Porsche, Luxury sells dreams. “Honestly now, did you spend your youth dreaming about someday owning a Nissan or a Mitsubishi?”.
And what is a recipe for growth of the luxury business?
People: passionate people, whose main daily goal is to serve the customers’ willing to spend in Luxury and to fulfil their needs.
The Luxury business growth rests on the ever-increasing desire to spend. It is based on people’s desire to spend. And who are the lucky ones? The new comers, from emerging countries, HNWI, who want to enjoy, to connect fast, to taste to the pleasures of life and the Luxury will offer that.
Let’s define the levers of luxury desirability today. Selection and Seduction!
On the Selection side we have Rarity and Exclusive. In Rarity there is production tradition and selective distribution. On Exclusive part there is the fact to remain unique and not for everybody.
On the seduction side, we have Prestige and Powerful Creative. The prestige splited in Glamour, Celebrities and Inaccessible History price. The Powerful Creative split between Fashionable and Status Distinction.
We are faced by speed of consumption and from the “take time to build desire“ we moved on the see now, buy now area! Beyond the beauty and the experience there is an urge to take immediate action. This shows the acceleration of luxury. The example is the fact that you can purchase Gucci and be delivered in 90 min at your home. The consequence of this acceleration is the fashionization of luxury! Fashion: a mechanism to refuel desire becomes influential in all luxury categories with higher rate of new products per year, higher number of collections, capsules, importance of relays of desire through bloggers and KOL’s.
We enter the new meaning of exclusive for Happy Few: “Just for me, excluding all others“. With the Big Data effect, it becomes: “They know me intimately, so that they propose just what I love” we are in the personalisation and high empathy as the advertising of Smirnoff “Exclusively for Everybody”. And in this move of personalisation, we observe the rise of Independent Niche Luxury Brands in the Era of Masstige- Strategies and Success Factors when Targeting the advanced Luxury Customer… Research Paper from Fabio Duma, Head Luxury Management and Maya Gadgil from Zhaw School of Management and Law, Switzerland. The future of luxury might not lie in multiplication, accumulation but in reduction and avoidance. The research for the Extraordinary is the opportunity for niche luxury brands to grow. They are passionate and vision driven, not marketing and profit driven. Their products are away from watching for prestige, status and functionality but on the other hand it’s all about art, craftsmanship, truly individual and unique products. In this “Economy of Small” the key success factors of Niche Luxury Brands are:
1- Customer Relationship: closeness and very personal connection
2- Product and Production with (a) absolute excellence in design, creation, craftsmanship and service, (b) highly individual customer experience, (c) lean and responsive, built in flexibility, ecosystem and enthusiasts
3- Innovation in many forms.
Surfing on the opportunity of innovation that offers the Luxury Sector which became a room to express personalisation and “the Whaou Effect”, was where many Startups in the Luxury sector were born. Just a quick reminder of success factors of Luxury Startups for the most entrepreneurial Research Paper from Elena Ehrensperger, Daria Erkhova, Aparna Yadavalli and Harley Krohmer, from University of Bern, Switzerland.
1. Luxury Affinity and Personal Branding Potential of the Founding Team
2. Long-Term Orientation of the Investors
3. Emotional Bonding with Key Partners
4. Strategic Focus on Prestigious Distributors
5. Long-Term Quality Orientation
6. Cost-Efficiency via Just-in-Time Individualized Manufacturing
7. Top Management Involvement with Customer Relationships
8. Authentic, Luxury-Affine Story
9. Story-Based Visual Innovation
The common path is that quantitative data shows us what people expect from luxury: high quality product and rarity.
THEY EXPECT NEW AUDACIOUS PRODUCTS!
During the LUXURY PURCHASE, the Luxury Culture from Sales associate is a key to a luxury purchase par categories of products. We observe in stores that all categories are pulled all together.
Luxury purchase is defined by these two most relevant situations.
1- Luxury is occasional use for gifts
2- To succeed, reward personal success
- Purchasing luxury is a good mood buster
- It depends on product categories: it brings self-confidence, idea of sensiorality…
- Reason is evolved when we purchase Luxury!
- They describe all the processes, before and during the purchase.
- Importance of quality: they expect to have a good quality and to have good value for money
- Reason and emotion are very evolved in the luxury purchase
- Key learning is to Different moods …use more emotion to purchase
- Luxury purchase is for very special occasions