‘Luxury’ has become a popular term in the recent years, but what are its real meaning and values? Is it still a signal for exclusivity and uniqueness? Is a luxury brand a selective symbol of scarcity, sophistication and good taste?
Obviously, in a dynamic market luxury business requires a global perspective. Luxury brands must be international and present almost everywhere. Beautiful objects, often handmade and characterised by superior craftsmanship, should be seen in more places in the world before customers will want to purchase them in their home country or elsewhere.
Luxury brand management is based on luxury value perception. Nowadays, the typical luxury buyer is replaced by various consumer groups. It is no longer reserved for the rich only and the new ideology ‘democratisation of luxury’ forced plenty of luxury brands to start their vertical brand extension strategy in order to offer lower prices on entry level products. Key challenge for luxury brand managers is balancing between preservation of brand’s exclusivity and satisfaction of the market without being overexposured.
Luxury is rare, but omnipresent. Traditions and cultural heritage are strongly interfered but when market is changing, adaptation is needed. Innovation and use of new technologies are crucial for the business. The Internet has become the primary search and purchase environment for a great part of the consumers, including wealthy and super-rich.
As the global demand for luxury is increasing, luxury brand managers have to transfer the deeper values of luxury in successful business models. Following a long-term strategy, understanding the consumers and their differences in the perception and motivation to buy luxury brands is critical.