The prestigious Boston Consulting Group has been recently vastly investigating the modern phenomena of the New Luxury. As a result they were finally able to answer the question: Why consumers want New Luxury goods? What is the psychology of this new cultural phenomena.
What does New Luxury exactly mean? The investigators from the BCG defined three major types of the New Luxury goods.
“Accessible supremium”: the products which are priced near the top in their category, but still accessible for the middle-market consumer, because they are the products of the everyday or almost everyday use. For example, the Danone yogurts, or the Belvedere vodka.
“Old luxury brand extensions”: lower-priced versions of products created by the luxury companies. We can see many examples of it in fashion: Armani developed their lower-priced line Armani Jeans, Dolce & Gabbana has D&G, Prada has Miu-Miu.
“Masstige” goods: short for “mass-prestige”. These goods are neither on the top nor related to other iterations of the brand. As an example we can remember the Body Shop, which has a certain level of service and quality, but still is the mass product.
There are many actual reasons for why the consumers choose more and more New Luxury goods in their lives. The BCG vinculates it to the new social changes, such as late marriages, less children, women working and maintaining themselves, more freedom and more time and money to spend on ourselves. Also there are some psychological aspects of the consumer´s behaviour which allow to talk about the New Luxury as a psychological phenomena indeed.
During the investigation there were four “emotional spaces” elaborated. They are: Taking Care of Me, Connecting, Questing and Individual Style. So these are the motivations which more or less define our choices in the everyday life.
Taking Care of Me (well-being, beauty and youthfullness, making time for myself). This emotional space is the most personal and immediate, it is about rejuvenation, stress reduction, emotional uplift, comfort, rest. Many cosmetic companies build their publicity and advertisement campaigns based on this emotional space. All of us can remember L´Oreal and its famous “Because you´re worth it”, and the endless spots about the rejuvenating creams and self-care products. The culture of youth and self-care is very popular today and neither the brands nor the consumers can ignore it. Certainly, this psychological point is not only about cosmetics. Here we can name other types of products, like chocolate, coffee, ice-cream, house appliances, etc. This category is about self-care and personal pleasures.
Connecting (attractiveness, hooking up, affiliation and membership). Because of the late marriages people spend more time dating and “branding” themselves, so when it comes to the relationship, women pay the same amount fo attention to it as men. Here we can find such New Luxury goods as good clothes and accessories, good restaurants and the certain level of other places where people use to go on dates.
Questing (taste, adventure, learning and play). This emotional space is about the goods we can buy which enrich our existence, deliver new experience, satisfy our curiosity, provide adventure and excitement and add novelty to our lives. This emotional space is more about travelling, but not only about it. This can explain, for example, the success of the new cultural phenomena as the concept-stores, like Colette in Paris or 10 Corso Como in Milan, which offer the latest, the ultimate, the exclusive, the unusual goods attracting the fashionable youngsters from all over the world.
Individual Style (achievement, sophistication and success). This emotional space is about people expressing themselves. It is very important in some categories of goods, such as cars or clothes, though it can be seen in the other categories too. Many marketing campaigns are based on this phenomena and that is why the consumers tend more and more to identify themselves with their favourite brand. For example, everybody heard about the expression “Prada girl”. What does it mean? It means sophistication, class, intelligence, prestige, high intellectual level. Where did it come from? It came from the message the brand is transmitting and the type of consumers they want to be related with.
The New Luxury goods are more than simply objects of consumption. They have become a language, a non-verbal method of self-expression and social dialogue. There is more complexity, interest, variation and subtlety in New Luxury goods than in conventional products. For sophisticated and discerning spenders, they provide a rich and broad vocabulary with which to speak – without saying a word.
Michael J. Silverstein, Boston Consulting Group “Why consumers want New Luxury goods and How companies create them”, Penguin Group, New York, 2008
