Where do luxury goods go now?

It's 10am on a sunny Sunday morning and for once the Avenue des Champs-Elysées is quiet. Normally the distant Arc de Triomphe is obscured by a haze of exhaust fumes rising from two crawling lines of traffic, but today the view up the avenue from the Place de la Concorde is diamond clear.

The avenue is not entirely deserted, however. A motorcade of three large black cars makes its stately way to the Louis Vuitton flagship store at the corner of Avenue George V. The cars sigh to a halt outside the emporium, which has been specially opened for the occasion.

A uniformed chauffeur emerges and opens the rear door of the middle car. From its cool dark interior emerges a vision in a cerise velour tracksuit. The tiny figure's neck and wrists are weighed down with gold jewellery. In her arms she cradles a chihuahua. The girl is barely 17 and she is a princess from one of the Persian Gulf States.

She is escorted into the store, where a personal shopper is on hand to help her. Although he speaks a handful of languages, his linguistic skills are not required. When the princess sees something she likes, she simply points. By the time she has left the store she has spent tens of thousands of euros.

This incident – sketched from life, with only minor embellishments – captures the essence of the luxury industry: an elite brand doing its utmost to provide a personalised service to a high-spending client.

For most of us, the world inhabited by the princess is impossibly distant from our daily lives. And yet every year luxury brands spend millions trying to convince us otherwise.

THE DEMOCRATISATION OF LUXURY

At the beginning of the 21st century, when established luxury brands fell into the hands of giant corporations with profit-hungry shareholders, this courtship of the mass market accelerated and intensified.

Sunglasses, sneakers, scarves, belts and billfolds – lower-priced items put luxury tantalisingly within our reach. We found that we could enter a Louis Vuitton store and purchase a relatively affordable gift (say, a $260 monogrammed passport cover) and be treated with only slightly less deference than the teenage princess. This development changed the luxury game.

The scarcity and 'aristocratic dimension' of these brands went hand in hand with a lofty price tag, making them inaccessible to most people. But with the democratisation of luxury, that definition had evolved.

The sophistication remained but the selectivity was less apparent. Now there were two sorts of luxury – the inaccessible and the mass. The factors that bound them were 'an additional creative and emotional value for the consumer' and the promise of quality – which was occasionally fulfilled.

The rise of accessible luxury stoked a fascination with the sector that generated books, documentaries, magazines and even celebrities. For what was Paris Hilton if not a goddess of accessible luxury, sent to entertain the masses?

The trend also provoked suspicion that the word 'luxury' had become devalued. The journalist Dana Thomas argued as much, forcefully, in her 2007 book Deluxe: How Luxury Lost its Lustre. 'The luxury industry … has sacrificed its integrity, undermined its products, tarnished its history and hoodwinked its consumers,' she wrote.

'In order to make luxury “accessible”, tycoons have stripped away all that has made it special.'

'Luxury' had become a synonym for 'overpriced' – so-so products sold at huge margins to pay for the glitzy marketing that surrounded them. Those who worked in the trade began casting around for alternative terms.

Tyler Brûlé, founder of the upmarket magazines Wallpaper and Monocle, offered 'über-premium', which he described as 'a blueprint for the new luxury'. The idea was to take luxury back to its original form, 'sourcing the rarest raw materials, reducing the number of items made, and [returning to] single-door availability'.

London department store Selfridges also rejected the L-word when it launched a space devoted to premium products in September 2007, instead christening it the Wonder Room.

The credit crunch and ensuing global financial crisis heralded a new phase. As the economy spiralled into recession, most consumers were forced to cut back on luxuries – accessible or otherwise. But the concept is too alluring to be banished altogether.

THE REHABILITATION OF LUXURY

The word 'luxury' has so many potential meanings – and can be adapted to such a wide variety of circumstances – that it flexes easily with the times.

Right now, conspicuous consumption is out of fashion. The logo-driven excess of the past decade is being looked upon – at least in the Western world – with distaste. And so luxury is showing us a gentler, more discreet face. Quality has become a watchword again. Authenticity is all the rage. A rehabilitation process has begun.

1. Treasuring

'Emilie is more interested in embroidery than marketing,' wrote a friend of mine on her Facebook status update recently. When I remarked on this a few days later, she told me that she was not entirely joking.

Emilie is a nightmare to go shopping with: she scrutinises every item of clothing like a forensic scientist, tugging at it to see what gives.

Now she refuses to buy expensive pieces unless they show some form of creativity beyond the advertising campaigns that have made them 'desirable' – hence her enthusiasm for embroidery. 'I want things that I will treasure.'

'Treasuring' is in vogue. There is a renewed appreciation of the handmade. Craft is respected. At the Milan Design Fair in 2009, Italian brand Fendi teamed up with the organisers of the Design Miami exhibitions and invited designers to create 'craft punk'. Participants were invited to work 'low-tech design magic' on discarded materials from Fendi's production process: leather, fabrics, plastic decorative elements and metal.

Visitors could watch the live creation of sculptures and installations – such as animal figures made from scrap leather and wire. Embroidery, collage and old-fashioned printing techniques were also on show.

As the design blog Unbeige commented, that's what you get when 'you mix design, innovation [and] a shaky global economy'. ('Design Miami teams with Fendi for Craft Punk in Milan', 14 April 2009.)

Only in that climate, too, would we have seen the creation of the Authentic Luxury Association, set up by individuals from the worlds of environmental concern, luxury branding and design.

'Luxury must be something meaningful and lasting. It is our conviction that superior social and environmental performance is becoming a defining aspect of elite design, quality and consumer experience.

'It is our conviction that luxury can lead, not lag, in the transition to a fair and sustainable world.' (www.authenticluxuryfoundation.org)

2. Social Luxury

At quite an early point in your life – around about school age – you realise that society is riddled with cliques. If you're not in the right one, you're simply not in. Concierge services set great store by the fact that they had excellent contacts. You may not be able to grab a table at that hot restaurant, or get invited to an exclusive party at the Cannes Film Festival – but they could get you in because they knew the right people.

Wealthy aspirants are aware that 'status' is about more than just logos. After all, anybody can buy an expensive handbag – but what use is it when you're freezing in line outside a club instead of sipping cocktails in the VIP area? Not only that, but the circles of power have become less visible.

The elite are not who they used to be. They are not politicians or bankers – they are stylists and gallery owners, restaurateurs and DJs. The rules of entry are vague and breaking in is much harder.

Some luxury automobile brands – Lexus, for one – already sell concierge services with their cars. Other luxury brands will soon offer access to elite social networking help when customers spend a certain amount.

3. Analogue Snobbery

The world is becoming digital. Pretty soon, like the fabricated universe depicted in The Matrix, it will be composed entirely of zeros and ones. That's a pretty alarming thought – but it only partly explains analogue snobbery. The other explanation is that technology is becoming common, and thus inexpensive. Objects from the analogue era are growing rare – treasured, even.

You go over to your hip friend's apartment and he puts a crackly vinyl disc on his record player. Nearby a collection of albums lovingly hunted down on eBay – of course, he tells you that he never stopped buying vinyl – sits proudly on display. Similarly, when I was at a party the other day, a selfconsciously 'cool' girl took my picture on a battered analogue camera.

'It's getting harder and harder to find the film,' she sighed.

Newspapers and books will become the next icons. Everyone accepts that news has migrated online and that printed newspapers are facing extinction. Those that survive will become more expensive, and they will adopt some of the attitudes of luxury brands.

They will distance themselves from the web by saying that their cultivated readers appreciate the time it takes to peruse a well-written article. They will portray their journalists as wordsmiths – craftsmen.

They will tell you that they use traditional printing techniques and paper from sustainable forests. Many magazines have already positioned themselves as glossy coffee table publications.

4. Disruption from Asia

If the luxury giants have become sluggish and predictable, there are opportunities for others. Nokia cleverly filled a niche with Vertu, its luxury mobile phone.

There is a similar Chinese brand called Veva, launched in May 2008 by Qiao Xing Mobile. The slender Veva phones come in gold-plated and crystal-studded versions.

The convention is that Asian markets are consumers rather than producers of luxury goods. But what if a new wave of luxury brands were about to emerge from Asia?

In fact, Asia has a history of bringing disruptive ideas to the luxury market. The group of avant-garde Japanese fashion designers that rose to prominence in the 1980s included Yohji Yamamoto, Issey Miyake and Comme des Garçons, launched by Rei Kawakubo in 1973.

Kawakubo's Dover Street Market concept store in London (in which designers are invited to set up 'creative spaces'), her temporary 'guerrilla' stores around the world and her unashamedly synthetic fragrances make her brand a model of alternative luxury.

This brings us neatly on to Shanghai Tang, the upmarket fashion brand started in 1994 by David Tang. Based in Hong Kong, it now has branches all over the world. It originally made tourist-friendly takes on Mao jackets and cheongsam skirts, but lately it has been channelling a more contemporary version of Chinese culture. Another interesting Chinese brand is Qeelin, styled as 'China's first luxury jewellery brand' (www.qeel-in.com).

Its jewel-encrusted pandas may not be to everyone's taste, but the brand has apparently been given the seal of approval by fashionistas like Marc Jacobs and Mischa Barton.

Chinese students can study fashion and luxury brand management. French business school HEC runs an 'Advanced Management Program in Fashion and Luxury' with Tsinghua University in Beijing.

5. Guilt-Free Luxury

The word 'luxury' can have negative connotations. In War and Peace, Tolstoy describes how Napoleon's entire invading army vanished into Moscow as if absorbed by the streets. It was ruined by a familiar temptation.

'The men who had recently made up an army drained away all over this wealthy, deserted city so richly supplied with goods and luxuries.'

Luxury, in this interpretation, should be resisted by the pure of spirit. But the notion of 'authentic' luxury offers an alternative approach.

Patrizia Pressimone, director of architecture at the Paris department store Printemps, said: 'Luxury is an aesthetic pleasure. It is a form of evolution, a sign that we have learned how to enjoy life beyond the basics.'

The next time we covet something, it may help to remember Patrizia's theory that the pursuit of luxury has contributed to art and culture – and perhaps to civilisation as a whole.

ABOUT THE AUTHOR

Mark Tungate, Kogan Page.

[email protected]

This article is adapted from 'Luxury World: the past present and future of luxury brands' by Mark Tungate, Kogan Page, 2009.

 

Figure 1: Louis Vuitton sells 'feel-good' accessories

Figure 2: Objects from the analogue era, such as vinyl records, are becoming rare, even treasured

Figure 3: Nokia's Vertu