EACD Lisbon Debate 2015 Luxury Communications Misha Pinkhasov Real Luxury

Luxury is the most emotional consumer product class. Its success is based on appealing to our desires, fantasies, ambitions and aspirations. So when we talk about luxury, more than any other business sector, we are talking about people. And when we talk about people we are talking about society. Luxury is also at the top of consumer product hierarchies, in price and in quality. So luxury is not about all emotions and all of society. Individually, it is about getting to something better – about leading us to progress, to success to a more comfortable and rewarding lifestyle. And collectively, luxury is what we associate with those who have attained that success – CEO’s, heads of state, celebrities – in other words: with role models and with leaders. So the role of luxury in society is a question of leadership.

When discussing luxury brands, we talk a lot about history: traditional craftsmanship, brand heritage, brand and stylistic revivals, etc. Mark Twain said…

To respond to this, managers of luxury brands need to take a close look at what it is they’re really offering to their customers… and to society. We need to look at the essence of what is luxury, really. “Luxury” is a word that we use a lot. Because the sense of luxury is a very personal thing, the word gets applied with varying degrees of accuracy. But when we take luxury from being a sentiment, an experience to being a brand, a business, an economic sector, it becomes important to – if not define luxury – at least set some parameters around what luxury is so that we can understand how it creates and provides value. Distinguish between personal ideas around “a” luxury and luxury as a product class and as a business… and its role in society…. Which means how we see luxury and how makers of luxury see luxury, market it to us and shape our desires, behaviors and ultimately our values. Despite how individual perceptions of luxury can differ, there is a broad consensus around what luxury looks like generally – these are the images we often see in the media– whether that has to do with …

To describe that difference and to describe themselves, luxury brands use a fairly consistent vocabulary of luxury. So consistent, in fact, that sometimes their language is hard to distinguish from one brand to another. Here we see a sample of that vocabulary, the result of a study done by Zooppa, a crowdsorcing company about global consumers’ associations with luxury. Interesting that two of the most frequently heard words in luxury – heritage and craftsmanship – are actually missing from this word cloud. We have “handmade” and, very small we have “authenticity”, which we could say are proxies for craftsmanship and heritage. But while luxury brands use those terms a lot, it seems they’re not actually at the front of customers’ minds. Notice that the biggest word here is “exclusivity”, which plays right into that very caustic social dynamic I described earlier. But there’s a bigger problem in that these are all descriptors of luxury, and to understand the mind of luxury, we need to look at what causes luxury to happen….

So what is luxury, really? What in the creation of a product causes us to perceive it as luxurious?

We identified two dimensions through which to understand luxury. It must be best in category …. explain It must be out of the ordinary … explain Three things to note here: These dimensions are at once objective and subjective, so we can apply them universally to the category of luxury goods, yet still retain the individual relationship with luxury. They are multiplied. So if the “score” for either dimension is zero, the whole equation comes to zero. These dimensions of supreme competence and uniqueness are the same as those found in leadership. But how exactly does luxury enact leadership?