From Luxury to Commodity – "Trending Towards Affordability"
"Luxury" is a very ambiguous word that is used very loosely.
Merriam-Webster defines luxury as: a state of abundance or of great ease and comfort: luxurious environment> 3 a: something that contributes to pleasure or comfort but does not necessarily belong to luxury> b: a pleasure that offers pleasure, satisfaction or ease.
Nobody would argue with the above definition, but the perception of luxury varies depending on the person and the product. For some people, there is no time not to think of luxury because for them the line between luxury and necessity is blurred. For others, it may seem uncomfortable to spend time in so many problems.
None of this is new or indicates a new trend. However, what is quickly emerging on the horizon of change is the degree of accessibility to luxury products. A recent study found that luxury brands have homogenized luxury so that 63% of wealthy consumers believe that luxury becomes commodity. According to a report from the Luxury Institute, "you can walk down most major streets like Fifth Avenue, Avenue Montaigne, and Bond Street – you'll see the same look in the designs and products of the stores."
This accelerating phenomenon of luxury items becoming affordable is due to several overlapping trends, including the emerging global marketplace, scalability in production, and the advent of the Internet.
Billions of new global consumers
The global market is leading to increased availability of goods for a group of consumers growing at unprecedented rates. Despite the recent crisis of confidence in the stock markets, global fundamentals make it more likely that millions will continue to be lifted out of poverty and millions more millionaires worldwide in the coming decades. From a global or even regional point of view, a relatively new segment of the market, the affluent masses, has become very important and attentive to the luxury brand marketers for obvious reasons.
Mass scalability for production
As companies discovered the potential for the creation and affordability of their luxury goods for the affluent masses, many luxury brands seeking to join a new class of mass luxury brands were seeking ways to scale production by building global partnerships in which to build The luxury goods can use production capacity in Asia as well as advanced global logistics solutions.
When luxury brands join the race to make this transition, they often seek to redeem luxury in a more democratic context by positioning themselves as an affordable luxury (a contradiction) to accommodate this huge market segment. In addition, you can get technical support for your computer from Manila in the Philippines, have your custom cabinets made to order in Beijing, China, or have your next Bhavya radiograph in Bangalore read. In his bestseller, "The World Is Flat," Thomas L. Freidman claims that people from faraway places become key players in the marketplace as global economic competition conditions are adjusted. The relevance of his position increases as we move beyond the product and superior service.
The world comes together – online!
Perhaps the most refreshing factor for any company that wants to take advantage of these overlapping trends leading to a revolution called the Luxury Access Revolution by the Luxury Institute is the Internet. Starting with the dot-com boom just over a decade ago, literally a trillion dollars has been invested in fiber optic cable. Together with the emergence of common software platforms and open source codes, efficient global collaboration has been enabled. According to Friedman, this flattening around the year 2000 converged and "created a flat world: a global, web-enabled platform for the exchange of knowledge and work, independent of time, distance, geography and increasingly language."
After some resistance to change, the debate over whether or not to sell them online is over for most luxury brands. According to Michael Baugus, CEO of Crossroads Enterprise, Inc., a specialist in fine kitchen cabinets, this new space will not only create executives who understand how technology, globalization and marketing are transforming our world online, but innovate online by Develop unprecedented products and categories that are relevant to this segment. This will revolutionize their industry. "
There are many ways for luxury providers to use this market power intelligently. At a Harvard Business School conference last April, Nancy F. Koehn, Professor of Business Administration at Harvard, explained the vitality of the market. She said, "Luxury goods were a changing space, a room with an extraordinary zipper and excitement, things are going strong." However, it is not natural to get into this room and succeed.
Today's consumers have little time, little patience, and little money with today's economy. For most products, especially luxury items, was looking for affordability. Even the extremely wealthy are very demanding, well educated online shoppers. This means that at every price point in the luxury spending spectrum, all consumers have a common interest in the value of the goods and services they buy, and that the medium of their choice for conducting their searches and increasingly for purchasing decisions is the Web, and you must be able to communicate your value among all the noise.
Secondly, while mass production and distribution are becoming a habit, many companies have unfortunately forgotten to their detriment to put emphasis in their new business models on the fact that today's consumers are not content with simply stamping out more products, but also that they require delivery from you. Excellent service. With everyone interested in taking advantage of the ubiquitous and readily available efficiency benefits online, consumer disparities are enhanced by superior service backed by transparency and trust. Not only at an individual level of experience, but they will also rely on and trust their purchasing peer groups, with whom they communicate regularly through their preferred online communities.
Everyone wins when a great service is discovered or rediscovered by the participants in this area, as it only adds to the experience and overall value that each customer receives. All in all, the quality of life for all will progressively improve as higher-quality goods and services become generally available and affordable for the masses, and companies strive to deliver them in a way that creates loyalty and trust.