New Definition Of Higher Luxury

The concept of luxury has been redefined. The choice of consumers has changed to two extremes, either to the traditional classic luxury brand or to the mass market.

What is the definition of luxury?

Its significance is different from before.

Consumers who pushed luxury goods to unprecedented heights in the boom years, while still enthusiastic about luxury goods during the post financial crisis, saw a significant reduction in spending.

Concetta Lanciaux, a luxury strategy consultant, said: "the concept of luxury has been redefined, and consumer choice has changed to two extremes, either to the traditional classic luxury brand or to the mass market.

The mid market and those products that look like luxury but not luxuries are selling well.

For example, the designer's second line brand sales are far less than before, and now consumers prefer to buy less clothes, but they are willing to accept a higher price. "

Fendi CEO Michael Burke

Fendi chief executive Michael Burke also agreed with Concetta Lanciaux's argument: "in a recession, people have to spend more reasonably, especially consumers in the US market.

Now the clothing market is becoming more and more polarized, the cheapest price or the really expensive luxury goods, and only the middle end market has been built up.

Luxury is not a product that the general public can afford.

Pam Danziger, President of Unity Marketing, a consultancy, said: "because of the recession, the number of American consumers who can afford luxury goods before 2008 has dropped sharply.

It is estimated that the annual household income of more than 250 thousand of the total consumers will account for 2% of the total population of the United States. Compared to families with annual income of 100 thousand to 250 thousand, the number of luxury consumers in more than 250 thousand households is three to four times between 10 and 250 thousand households.

Last month, a survey of 1200 wealthy American consumers showed that even the elites still had a cautious attitude towards luxury consumption, and this trend will continue until the second half of this year.

Lanciaux also predicted that the situation will be more severe in the second half of the year than in the first half of the year. The main reason for the increase in European luxury sales in the first half of the year was the appreciation of the US dollar against the euro in the first two quarters, which promoted the sale of luxury goods.

Most of the top executives, consultants and analysts believe that luxury goods are essential if they want to further develop and seize the young elite and emerging markets.

In a recent report, Luca Solca, an analyst at Bernstein research, said: "overseas markets will be the main driving force for the long-term development of luxury brands.

Although Japan and the US are still the two largest luxury goods market, we expect that the importance of emerging markets will become increasingly prominent.

Luca Solca said: "by 2020, the total demand of overseas luxury goods market will reach 66%." Guy Salter, vice president of the British Luxury Association, said: "in the first half of the year, the rebound in the luxury market was not just because the rich people were spending, but also the consumers of other sectors.

Many luxury brands have launched a more "approachable" price line. Those who have positioned themselves in luxury brands that can afford their customers have been doing very well recently.

Taking London as an example, the luxury goods that we can afford to spend are good, and there is room for development.

Guy Salter also said, "although consumers are changing their shopping habits, they will buy classic products of high-end brands because they have their own value in the long run.

And the consumption they cut is the so-called "unreasonable" spending, for example, the most "in" purchases will drop.

And the product will still have a good market if it is classic, well produced and priced.

President and CEO of Robert Polet, Gucci Group

Robert Polet, President and chief executive officer of Gucci Group, said: "the consumption of impulse buying luxury goods has been significantly reduced in the era of economic depression.

At the same time, prudent consumers pursue products with higher quality, longer value preservation and competitive advantages.

These traditional luxury brands like Chanel, Herm s and Louis Vuitton still have a strong market.

In order to achieve long-term development in the post financial crisis era, luxury brands also need to provide more services to consumers, such as an ideal life style, so that we can create a different consumption scenario which is different from discount products and fast fashion. Only in this way can we attract consumers' love for luxury goods for a long time.