Contemporary Luxury Perspectives by Ben Cox

CONTEMPORARYPERSPECTIVES

Luxury

An Investigation into Motives for Consumption of Luxury Goods in Contemporary Society

Ben Cox

Contemporary Luxury Perspectives An Investigation into Motives for Consumption of Luxury Goods in Contemporary Society

Author: Ben CoxE-mail: [email protected]

Design: Ben Cox

Copyright © 2008 Ben Cox

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Contemporary Luxury Perspectives

An Investigation into Motives for Consumption of Luxury

Goods in Contemporary Society

Master thesis by Ben Cox

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Abstract

Trend reports propose new ideas toward the concept of luxury. In addition marketing research addresses a phenomenon described as the ‘new luxury’ market, often related to the democratisation of luxury. The matter suggests possible new motives for luxury consumption outside the conventional economic luxury sector. This thesis study considers current views on luxury and aims to suggest more holistic motives for luxury consumption in con-temporary society. The focal point of the thesis revolves around the following research question: ‘What consumer motives are of signifi cant infl uence when considering contemporary perspectives of luxury consumption?’. The study is undertaken with an emphasis on a Western European context.

Research concerning diff erent viewpoints and areas regarding luxury were analysed to create deeper understanding. This resulted in a framework of what constitutes a luxury product. The holistic defi nition of a luxury product provided by the framework created the opportunity to frame motivation for luxury consumption accordingly. The framing resulted in two perspectives of luxury: the traditional perspective of luxury and the new perspective of luxury. The traditional perspective of luxury is related to interpersonal mo-tives for luxury consumption, whereas the new perspective of luxury is related to personal motives. Research concerning societal change and values were considered to support the perspectives. Two case studies were conducted to support the thesis’ fi ndings concerning the two perspectives. The case studies give practical examples of products perceived as luxurious and exemplify fac-tors that may infl uence the perception.

The thesis outlines a new approach towards the concept of luxury by pro-viding a framework of what constitutes a luxury product and illuminates two perspectives accordingly, which are then translated into motives for luxury consumption.

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Acknowledgements

Before you lies my thesis submitted in the fulfi lment of the Master’s Degree: Industrial and Strategic Design, School of Design, University of Art and Design Helsinki. Firstly I would like to thank everyone that made this thesis possible.

Foremost I would like to thank two people that guided me through this thesis study. These people are my tutor Prof. Minna Uotila and my professor from Industrial and Strategic Design Prof. Peter McGrory.

I would like to thank the following people in particular for various reasons; Su Bing, Korhan Büyükdemirci, Heddwen van Gestel, Aila Laakso, Bjørn Saunes and Ryan Sohlden.

Finally my gratitude goes to my parents and brother for always being there when I need them the most. Also throughout the time of this thesis they have been invaluable to me.

1 Introduction .......................................................12

1.1 The Subject and Context of the Study ................12 1.2 Framework of the Study.......................................13 1.3 Realisation and Outcomes ...................................14 1.4 Personal Motivation .............................................16

2 Luxury and History ............................................20

2.1 Etymology of Luxury ...........................................20 2.2 The Classical Notion of Luxury ...........................21 2.3 The Luxury Debates..............................................21 2.4 Luxury and Availability ........................................22 2.5 Implications concerning Contemporary Luxury Consumption ...........................................23

3 Theoretical Framework of Luxury Products .....28

3.1 Perceived Needs and Desires ...............................28 3.2 Sign-Value .............................................................30 3.3 Price Infl uence on Luxury Products ....................31 3.4 The Emergence of Luxury ....................................32 3 4 1 Basis of Luxury Products ....................................32 3 4 2 Knowledge Aff ecting Luxury ..............................32 3 4 3 Context Aff ecting Luxury ...................................32 3 4 4 Luxury within Communities ..............................34 3 4 5 Types of Luxury .................................................35 3.5 Towards a Framework for Luxury Products .......37

Table of Contents

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4 Perspectives of Luxury ...........................................42

4.1 The Indefi nable Character of Luxury ..................42 4.2 Consumer Attitudes toward Luxury ...................44 4.3 The Traditional Perspective of Luxury ................46 4 3 1 Traditional Luxury and Consumption Today ....46 4 3 2 Dominating Traditional Motives .......................47 4.4 The New Perspective of Luxury ...........................49 4 4 1 A New Emphasis in Luxury Consumption .........49 4 4 2 Change of Values ...............................................50 4 4 3 New Consumer Attitudes towards Luxury .........54 4 4 4 Changes in Perception of Quality .......................56 4 4 5 Dominating New Motives ..................................58 4.5 Framework of Motives .........................................60 4.6 Luxury Consumption in Contemporary Society ...................................................................62

5 Manifestation in Society .......................................66

5.1 Market Segments Associated with Luxury ..........66 5 1 1 The Economic Luxury Sector ..............................66 5 1 2 The New Luxury Market ....................................68 5.2 Luxury Goods within Communities: Two Case Studies ...................................................................69 5 2 1 From Status Symbol to Commodity: case: Motorola RAZR V3 ...........................................69 5 2 2 A European New Luxury Example: case: Innocent Drinks .................................................72

6 Conclusions and Refl ections ................................78

6.1 Conclusions ...........................................................78 6.2 Possible Future Directions ...................................80 6.3 Refl ections regarding the Study ..........................81

References ....................................................................82 List of Figures...............................................................86 Appendices ...................................................................88

1This chapter describes the outline of the project including the research question and the realisation process.

Introduction

Chapter one Introduction

1.1 The Subject and Context of the Study

Luxury is a concept, which each and every one of us can relate to in one form or another. Most certainly everyone has some idea or opinion as to what constitutes luxury. Generally it conjures images of comfort, expensiveness and exclusivity.

Nonetheless it is a concept that can hold many diff erent meanings in dif-ferent contexts, such as cultural, technological and personal. From a techno-logical point of view luxury could be seen as highly innovative and of high material quality. From an economic point of view luxury could be seen as something highly expensive. In a social context it is more diffi cult to describe, but it has been associated with the stratifi cation of society. People in higher social classes were traditionally the only ones who could aff ord or had access to luxury products. Hierarchical structures in social class were often secured through purchasing and conveying luxury items. These views are still appar-ent today, nevertheless there are several signals that the notion of luxury is changing. The contemporary perception of luxury may be somewhat similar, yet dissimilar from what it used to be, because of a changing array of social, technological and economic factors.

Today various perceptions of luxury are directed toward the enriching of the inner-self, placing more emphasis on the personal side of luxury. Self-actuali-sation and self-pleasure is becoming increasingly important in the consump-tion of luxury products, whereas before indicating status was seen as the most important factor in consuming luxury. The availability and aff ordance of luxury products has increased signifi cantly as well. The market has responded to consumer wants and desires and companies have reacted by making luxury products more accessible to the masses. These changes are often referred to as being related to the democratisation of luxury or the ‘new luxury’ (Dan-ziger 2005: 1, Silverstein and Fiske 2005: 3). Other terms associated with these changes are ‘experiential luxury’ (Danziger 2005: 33), and ‘responsible luxury’

1 Introduction

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(Carlson 2007). Therefore this thesis attempts to look beyond the traditional notion of luxury goods comprising of brands such as Chanel, Cartier and Versace.

Because of changes in society presumably resulting in new perceptions of luxury, contemporary luxury consumption may manifest itself diff erently. The emphasis of this thesis lies therefore with the social and economic con-text of luxury. This manifests itself in the consumption of products that are perceived as being luxurious for various reasons.

1.2 Framework of the Study

The research question revolves around the notion of luxury and in particular the motives that are related to the consumption of luxury goods. Luxury is a topic that has been revived through discussions related to the changing character of it. This was the starting point of this thesis and resulted in the following research question:

What consumer motives are of signifi cant infl uence considering contemporary perspectives of luxury consumption?

This question considers multiple forms of luxury and asks for an exploration of the general concept in a historical as well as a contemporary view. In order to narrow the study down to fi t within the scope of this thesis, a focus on Western Europe has been chosen. Nevertheless the fi ndings may be useful in other contexts as well.

The thesis’ aim is to address motives behind luxury consumption. In order to reach that aim, various literature is investigated concerning the percep-tion, history and development of luxury. The main driver behind the study is the changed perspective of luxury, which has manifested itself in a newly emerged market and changed attitudes toward luxury. The thesis may give an updated understanding of motives concerning luxury consumption incorpo-rating the changing nature of luxury.

This study is undertaken in the line of recent studies. The subject has gained great attention due to changes in society and shifts in values it corresponds with. This is often referred to as ‘postmodernisation’ (Inglehart 1997: 5). These changes may have had a massive infl uence on the perception of luxury.

A study undertaken by Carbonaro and Votava (2005) suggests a new ap-proach towards marketing. By doing so several models are introduced that reveal new approaches toward consumption. The concept of quality is ad-dressed and translated into categories. These are of direct infl uence on the perception of luxury.

A study on the phenomenon new luxury has been undertaken by The Boston Consulting Group and has been published in the book Trading Up: Why Consumers Want New Luxury Goods... And How Companies Create Them


in 2004 and has since received great interest. Mainly marketing strategies are addressed in how to successfully enter the new luxury market. The book focuses on the increasingly affl uent middle class of contemporary consump-tion societies.

An attempt to categorise luxury in diff erent clusters based on the changes in consumption practices has been undertaken by Cautela et al (2007). The paper suggests several luxury categories based on identifi ed descriptors.

In the context of the meaning of luxury from a social point of view, a study undertaken by Mortelmans in 2005 aims to outline a defi nition of luxury in a semiotic way. The concept of luxury is approached as a social phenomenon rather than related to a product segment. As a result he gives examples of stratifi cation processes and suggests a defi nition of luxury in terms of ‘sign value’ (Mortelmans 2005). This study suggests that the expression luxury can-not be defi ned.

The history of the notion of luxury in a European context is demonstrated in the book The Idea of Luxury: A Conceptual and Historical Investigation by Christopher Berry (1994), who discusses the topic from a needs and desires perspective.

Consumer motives toward luxury consumption have been studied by Vi-gneron and Johnson (1999). The paper suggests a framework of consumer mo-tives related to the consumption of luxury based on the analysis of previous studies related to the matter. The study is one of the fi rst that combines luxury for interpersonal and personal use in one single framework.

A study by Reinmoeller (2002) focuses on the emergence of luxury. In doing so, several interesting theories are addressed and developed that may help to understand luxury as a social phenomenon and understand the infl uence of recent society changes.

The study undertaken here contributes to and builds on the studies above by suggesting a framework of consumer motives that signifi es the most impor-tant motives today considering luxury consumption in a Western European context. In addition case studies are undertaken to support the theory dis-cussed.

1.3 Realisation and Outcomes

The research question consists of three main following parts that need to be investigated in order to reach a soundly constructed result. Firstly the notion of luxury consumption needs to be clarifi ed. Secondly perspectives concern-ing luxury need to be investigated and proposed. Finally these need to be connected to the notion of consumer motives. The main methods used to achieve the results of this study consist of literature review summarising and synthesising. The fi nal results were shaped by connecting and reinterpreting

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literature, trends and articles. The proposal of a framework of a luxury prod-uct is given to complement the fi rst part of the research question and help to illuminate the reasoning of consumption of luxury goods. Based on the syn-thesis of the framework together with literature review and personal insights, perspectives of luxury were formed. These perspectives were projected onto a framework of motives developed by Vigneron and Johnson and adjusted accordingly to propose a revised framework of motives concerning luxury consumption that may refl ect the identifi ed perspectives of luxury.

Connecting ideas from several sources was partially done using the affi nity diagram method. This method is particularly useful for synthesising large amounts of data. By establishing relationships between sources and ideas, groupings can be made to clarify the material. Headings and subheadings may clarify topics and guide the structuring. The affi nity diagram method proved to be useful in this thesis. It was used to structure notes derived from literature to categorise corresponding ideas. This was done throughout the study to guide the direction of further research. An example of a grouping constructed using the affi nity diagram in an early stage of this thesis is dem-onstrated in fi gure 1.1. The cut-out material contains notes derived from litera-ture reviews and is structured with headings to link the material according to subject. Headings and subheadings written down on post-it notes suggested possible categorisation of the material.

Case studies have been conducted to connect the theories discussed to real life examples. The case studies are designed to provide clarity with practical examples of the theory discussed. They revolve around products that have been carefully chosen to cover important aspects of the thesis.

Figure 1.1 Groupings made with the affi nity diagram method


1.4 Personal Motivation

Personal motivation at the start of this thesis was found on a number of lev-els. The fi rst and foremost motivation was providing a thesis that is suffi cient to graduate as a Master of Arts in Industrial and Strategic Design. In addition this thesis was undertaken to improve and increase personal knowledge useful for successful continuation of a professional career in the design fi eld. Both new and applied knowledge have been gained with this thesis. The subject of this thesis is of a wide scope, yet covers an interesting area that is useful for several companies that are active in the consumer industry. My understanding of the concept of luxury, both in a historical and contemporary context, has grown substantially. Secondly the review of consumer motives concerning luxury provided me with better insights in what drives consumers. Despite the fact this review was limited to motives in relation to luxury consumption, these insights will undoubtedly be useful in other contexts as well due to the increased insight in consumers’ drives.

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2Luxury: a Historical Overview

This chapter discusses the notion of luxury from a historical perspective and concludes by suggesting the implications historical issues may have had on contemporary luxury consumption.

Chapter two Luxury: A Historical Overview

2.1 Etymology of Luxury

The etymology of the word luxury suggests that the meaning has changed throughout time (see fi gure 2.1). This indicates that luxury was interpreted diff erently throughout time and implies a shift in views toward the concept of luxury. In order to understand the concept of luxury, main views in history are addressed.

Thoughts on luxury in Greek and Roman times, as well as Christianity, are addressed. These thoughts approach the concept of luxury from a negative point of view, that is, as a possible threat to society. Secondly views of luxury from luxury debates started in the 18th century are addressed. These approach the concept in an economic way. The diff erent views and their implications are elaborated further on.

2 Luxury and History

luxury

1340, “lasciviousness, sinful self-indulgence,” from O.Fr. luxurie, from L. luxuria “excess, luxury,”

from luxus “excess, extravagance, magnificence,” probably a fig. use of luxus (adj.) “dislocated,”

which is related to luctari “wrestle, strain.” Lost its pejorative taint 17c. Meaning “habit of indul-

gence in what is choice or costly” is from 1633; that of “sumptuous surroundings” is from 1704;

that of “something enjoyable or comfortable beyond life’s necessities” is from 1780. First used as

an adjective 1930.

(Harper 2001)

Figure 2.1 Etymology of luxury

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2.2 The Classical Notion of Luxury

According to Plato luxury could lead to the downfall of a society (Berry 1994: 62). In his Politeia (Berry 1994: 45) Plato examined the function of the polis. The basis of an ancient Greek city-state could be found in three basic needs: food, dwelling and clothing as stated by Plato. Fulfi lment of these needs could not be met by oneself; others were required to assure these. The group that formed because of this was called the polis by Plato. Everyone in the po-lis did a task that fi tted him best. Furthermore Plato stated that going beyond the basic needs, for example decorating clothing that is not necessary to pro-tect you from the weather, caused the polis to become unbalanced and thus unhealthy (Berry 1994: 51). Following this, the harmony of the basic ‘healthy’ polis might be replaced by the unending striving for wealth and luxury. This voraciousness might eventually lead to the downfall of society and its citizens, therefore luxury was seen as dangerous to society (Berry 1994: 62). The Ro-mans had a similar interpretation of luxury and saw it as dangerous because it contradicted ‘the natural life’ of Stoic thought. The natural life meant not exceeding the limits of the body’s requirements and was therefore seen as the simple life (Berry 1994: 64). In both Ancient Greek and Roman thought people’s needs were seen as fi xed. Sumptuary laws were made in an attempt to control luxury. Despite this the Romans eventually embraced a luxurious lifestyle, which was said to have partly caused the fall of The Roman Empire as stated by Livy in his History (Berry 1994: 68).

The second period that condemned luxury because of its apparently society destroying aspects was Christianity. Their beliefs were built on the Romans’ ones and further developed in the context of moral inappropriateness. Christi-anity in Medieval Times linked luxury with sins (Mortelmans 2005). This is still found in the French word luxure, which means lechery. These two words were interchangeable in that time period (Berry 1994: 87). In Ancient Greek and Roman times as well as medieval Christian times, luxury was seen as a threat to society and thus was tried to be controlled.

2.3 The Luxury Debates

The notion of luxury was discussed from an economic point of view after the classical notion of luxury. This started in the 17th century when benefi ts of luxury for trade were addressed and suggested a positive outlook. Barbon was the fi rst to state the positive eff ects of the creation of fashion and luxury goods. He implied that the wanting of luxury goods and changing fashions stimulated trade. Since trade was benefi cial for the well-being of society, luxury goods had a positive infl uence on society as a whole (Berry 1994: 124, 125). In his The Fable of the Bees, Mandeville was the fi rst to openly proclaim the positive eff ects on society next to the negative notions of luxury, for example greed. He stated that society would benefi t from the selfi sh charac-


teristics of people aspiring enjoyment by luxury, because this would generate trade and manufacturing of luxury products leading to a powerful society. He hereby tried to destabilise the idea that an austere life assured societal progress (Mortelmans 2005, Berry 1994: 131).

In opposition to these views the French philosopher Rousseau had a diff er-ent opinion. He saw poverty as a direct result of luxury in society (Mortel-mans 2005). Luxury caused inequality between poor and rich. Because the rich were indulging themselves with luxurious products, the poor did not have enough means for their basic needs (Williams 1982: 44 in Mortelmans 2005). Luxury has always been associated with wasting resources that could have been used for necessities. Nevertheless luxury has been related to strati-fi cation processes and thus serves a prominent role in society (Mortelmans 2005).

Finally Smith seemed to end the luxury debates with a commonly accepted viewpoint (Hilton 2004). Smith’s view on the topic was that greed and the de-sire to get wealthy, which stimulated individual consumption, was necessary in order to stimulate the economy (Hilton 2004). Smith justifi ed the demor-alisation of the concept of luxury from the classical notion with the benefi ts trade brought to society. Moreover Smith believed that it lay in human nature to aspire to improve one’s condition. He stated that a commercial society could provide the enjoyment of freedom and opulence (Berry 1994: 154, 172). Christopher Berry’s book The Idea of Luxury: A Conceptual and Historical Inves-tigation (1994) provides a comprehensive analysis of the concept of luxury in history and its implications.

2.4 Luxury and Availability

Changes in both view and meaning of luxury caused the concept to be avail-able and used diff erently according to time and location. The most signifi cant change in availability is related to trade and commercial society. Related to this a new understanding of luxury emerged. Before the luxury debates and the uprise of capitalism, luxury was inevitably associated with predetermined social order (Shovlin 2000). The main purpose was to distinguish higher so-cial orders, for example the monarchy, from nonnobles, for example peasants. Luxury was used to make a clear distinction between higher powers and nor-mal people, for example in the church to divide the divine from the ordinary. Luxury products used to be only available for few, because social classes were defi ned in society and it was nearly impossible to move up in social standing. In order to control this, laws were for example made to prevent lower classes to have access to luxury. Luxury was used to convey social order in an infl ex-ible manner (Shovlin 2000).

Capitalism however, changed the traditional social order structure. The mid-dle classes got more affl uent through commercial practices (De Vries 1999),

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but were not able to raise their positions because of the inevitable link that existed between position and consumer pattern. Capitalism slowly weakened this link, which eventually could be seen in the French Revolution that broke the relation between power, position and luxury and turned luxury into a consumer product that could be obtained by people who were able to aff ord it (Mortelmans 2005). Shovlin stated that because of this a new way of social structuring appeared. He highlighted that the old use of luxury to indicate so-cial order lost its dominant position. New social diff erentiation traits emerged that signifi ed new social identities (Shovlin 2000). This new use for diff eren-tiation caused luxury goods to change their symbolic character (Mortelmans 2005). Luxury became available to those who could aff ord it and therefore luxury was turned into a consumer product (Mortelmans 2005). Jan de Vries stated that products became increasingly uniform and similar among people’s possessions in 17th century Dutch society. The distinguishing factors were in cost and quality, rather than in owning diff erent types of objects according to him. In the 17th century Dutch Republic a new view on luxury, moving away from the classical distinction purpose had emerged, which manifested itself in the production of products with a variety of quality. The owning of similar products, diff ering only in quality and cost, through all layers of society as a result of economic development, indicated a shift toward achieving comfort (De Vries 1999).

2.5 Implications concerning Contemporary Luxury Consumption

The impact of history on the consumption of luxury goods is signifi cant. The most prominent impact for today is the fact that luxury became part of our consumer culture. Capitalism changed the view on luxury products and linked availability with income, rather than availability based on predeter-mined social order as seen before the 17th century. Luxury products became available for affl uent people in general and were used for stratifi cation of society in a diff erent way. Consumption patterns were used by social status groups to set themselves apart from other groups (Bocock 1993: 6). Today luxury goods are part of our consumption society. Therefore luxury goods may be used in constructing identity through consumption practices.

As mentioned earlier, the meaning of the word luxury developed from sinful in medieval times to a more positive meaning during the 18th century. Even though this is the 21st century, those contradictions still refl ect the interpretations of most people today. Research conducted in Milan among 292 middle class people showed that luxury is for example associated with personal achievement, but also with the pursuit of vanity and considered an excess (Carcano and Catalani 2005). In another study conducted by Dubois et al (2001) a similar result was found. The results of the study indicated that there are many contradicting views and attitudes concerning luxury present


among people today, especially between the attitudes towards the general concept and the attitudes towards the products or services that are considered a luxury. Attitudes towards the general concept hold mental reservations opposing conspicuous consumption, which is generally negative. Most of the time luxury is associated with wasting materials and with posh behaviour. On the other hand a deep involvement can be seen among people related to par-ticular products or services associated with luxury, for example the aesthetic value of those products or the pleasure and comfort it may give. This is seen as positive. However, these positive and negative aspects are independent from each other and can be found within the same person (Dubois et al 2001). The consumption of luxury products nowadays may be associated with posi-tive feelings. Considering the scope and aim of this thesis, the emphasis lies with the positive aspects regarding luxury consumption.

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Theoretical Framework of

Luxury Products

This chapter considers theoretical ideas about the notion of luxury from different perspectives. Based on these theories a framework for the conceptualisation of a luxury product is proposed.

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Chapter three Theoretical Framework of Luxury Products

3.1 Perceived Needs and Desires

From a philosophical perspective luxury has been approached with the needs and desires approach. It would be easy to say that anything that is regarded as a need would be necessary, whereas objects that are desired would tend to be considered luxuries. Nevertheless it is diffi cult to state it this easily, because clearly needs and therefore also desires are relative. Christopher Berry explores the two concepts thoroughly in his The Idea of Luxury (1994) and defi nes two types of need (as quoted by Van der Veen 2003):

a) Basic needs, such as sustenance, shelter, clothing and leisure. All four are universally regarded as necessary features of human life, and they can be described as objective or universal, in that they do not refer to the particular requirement of an individual, but to the general needs of all human beings. Following Wiggins (1985: 152–3) such needs are described as ‘the way the world is’. For example, we all need vitamin C to avoid getting scurvy (that is the way the world is), but this is independent of our desire to eat fruit. In this sense, needs are not intentional and not privileged; they are ‘states of the world’, as opposed to ‘principles of action’ (Berry 1994: 9–10).

b) Volitional or instrumental needs, which are ‘instrumental means to an end’. These are often, though not necessarily, utilitarian objects such as a pen or an electric knife, which one needs to fulfi l a desire, i.e. to write a letter or to carve a joint of meat. Thus these needs are different from basic needs, in that they arise by virtue of a prior desire (ibid.: 9–10).

Luxuries are inevitably linked to needs and cannot be defi ned without them. They represent the refi nement of basic goods and are an indulgence. A good can be refi ned more and more, for that reason luxury is liable to change and cannot be defi ned in a defi nitive way. If the process of refi nement is infi nite, there will always be a desire for that better refi nement as it typically lies in human nature to strive for a higher status in whatever form that may be. Berry gives as an example that one would desire a cashmere coat instead of a goatskin to fulfi l the need for warmth. Moreover the cashmere coat can be

3 Theoretical Framework of Luxury Products

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refi ned further if it is for example handcrafted instead of machine produced (Berry 1994: 11).

Needs are diff erent in every society and can be identifi ed as social necessities. Therefore luxury is perceived diff erently in virtually every society and may change over time. For example a refrigerator was seen as a luxury in Finland some time ago, while now it can be seen as a social necessity. Every society has its own borderline of what is perceived as socially necessary and based on that, luxuries may be defi ned. Berry eventually describes a luxury good as:

… a widely desired (because not yet generally attained) good that is believed to be ‘pleasing’, and the general desirability of which is explained by it being a specifi c refi nement, or qualitative aspect, of some universal generic need. (Berry 1994: 41)

Because of this luxury goods change over time due to the possibility of con-tinuous refi nement and can eventually become social necessities (Berry 1994: 18). Examples of this are the television, indoor sanitation, sugar and several spices that changed status due to several circumstances, for example reduction in production costs because of industrialisation (Mintz 1985, 1993 in Van der Veen 2003). Because of the ability by the lower classes to consume these prod-ucts or adopt certain customs, products moved down the hierarchical ladder as they were not able to express their original meaning anymore (Bocock 1993: 18, 31). This eff ect is commonly known as the trickle-down eff ect. An example of this is given by Mennell (1985 in Van der Veen 2003) who argues that in the 17th century in Europe when food became more accessible for the lower classes, it became diffi cult for the elite to distinguish themselves through quantity of food. As a result the elite shifted their focus to more qualitative aspects of food as well as introducing rituals, for example the introduction of new spices in food preparation and the development of menus (Van der Veen 2003). Over time higher social classes became more sensitive to the qualitative aspect of products to set themselves apart due to increasing avail-ability of similar products (De Vries 1999). Consequently other characteristics became accountable for luxury goods. The most important characteristic that is still seen today is the notion of quality and is almost interchangeable with the notion of luxury from a consumer perspective (Dubois et al, 2001). The refi nements of luxury goods have been used to refl ect the diff erences between individuals, but are nonetheless linked to basic needs (Berry 1994: 41-42). In the fi rst half of the 20th century consumption practices became progressively more available in all layers of society (Bocock 1993: 21) resulting in a faster trickle-down eff ect for products. Today this process is still relevant and is ad-dressed by American Express Vice President Silvia Bass in an interview, who recognises this process of luxury goods turning into standard goods and states this is happening much faster than in the past (Danziger 2005: 5).

Another aspect related to luxury is achieving comfort, which was shortly ad-


dressed in the previous chapter and could be seen fi rst related to consumption practices in the 17th century Dutch Republic (De Vries 1999). With society becoming more focused on comfort and enjoyment, luxury products acquired integrated qualities concerning these newly arisen notions. Berry describes this as pleasure that is a form of positive desire (Berry 1994: 12, 13). Vigneron and Johnson state that these inherent qualities of luxury products have gained increased interest in research in the last couple of decades. They concluded this based on the research they reviewed and framed this in the term hedo-nism to highlight a motivation in luxury consumption that is personal and often related to sensory pleasure (Vigneron and Johnson, 1999). Deriving pleasure may be seen as an important aspect in the use of luxury products.

3.2 Sign-Value

The fi rst comprehensive study related to the subject of the upper social class and how they use their wealth to distinguish themselves from others is undertaken by Thorstein Veblen in 1899. He introduced the term ‘conspicu-ous consumption’, meaning the excessive spending on products and services that are for the most part acquired as a purpose to show wealth and status. Veblen (1991) pointed out in his book The Theory of the Leisure Class that be-ing wealthy alone is not suffi cient to indicate one’s position in society, but it had to be shown to guarantee one’s position in society. People spend money to attain and maintain their social status. Hence a good becomes a mean to express social standing, which makes it a tangible form of communication (Appadurai 1986: 38 in Van der Veen 2003).

Luxury goods are highly symbolic goods that cannot be systematised, because they belong to a category of goods that is cultural (Catalani and Car-cano 2005). This suggests that people will interpret a luxury good diff erently according to culture, social status, ethics etcetera. If luxury is meant to dif-ferentiate oneself from other classes, it can also be used in classes other than the elite to distinguish oneself from diff erent classes or groups (Mortelmans 2005). This explains why goods are considered luxurious by some and not by others. Goods can have diff erent meanings in diff erent contexts when they are perceived or used by diff erent people. Mortelmans states that luxury products, in order to defi ne luxury in contemporary consumer society, are:

…those products that have a sign-value on top of (or in substitution of) their functional or economical meaning (Mortelmans 2005).

Sign-value in products is described by Mortelmans as the value that gives ad-ditional meaning to a product. He states that multiple goals can be strived for and underlines the polysemic, undefi ned character of it (Mortelmans 2005).

Mortelmans argues that the luxury sign-value in products is related to the communication of social stratifi cation. He states that the luxury sign-value

3130

is thus only apparent in interaction processes between people to indicate higher social prestige. In the consumption society of today every product can therefore turn into a luxury when it is used for hierarchical social distinction (Mortelmans 2005). Nonetheless the concept of a luxury product is broader than only the stressed luxury sign-value by Mortelmans. It encompasses other qualities equally important besides the use in distinction processes (Vigneron and Johnson 1999), that is, providing pleasure and self-development. In ad-dition, formed opinions on luxury infl uence the perception and therefore motivation of luxury consumption, which is addressed by Mortelmans as well. Hence for our purpose to identify motives of luxury consumption in contemporary society, the sign-value Mortelmans addresses is useful in the description of a luxury product, as well as the suggestion that luxury is seen throughout society as a social phenomenon and is not restricted to a product category.

Sign-value on the whole is highly important for luxury goods, but also dif-fi cult to control due to the fact that it is interpreted according to context and knowledge (Mortelmans 2005). Furthermore it is unmistakably one of luxury goods’ most important characteristics and may be a reason for consumers to purchase luxury products. The infl uence of context and knowledge is elabo-rated further on in this chapter.

3.3 Price Infl uence on Luxury Products

Luxury products are inevitably relatively expensive. Premium pricing is linked with luxury products in the mind of the consumer (Yeoman and McMahon-Beattie 2005).

A high price implies premium quality. If a similar product is off ered by sev-eral companies, the most expensive product is considered of a better quality than the cheaper one. Within companies, similar products are often off ered with an extensive price diff erence. A study by Dubois et al (2001) indicated that the most expensive product within a range is believed to be of the high-est quality. They argued that the price value is not restricted to the fi nancial aspect alone, but also involves a psychological aspect. The eff ort that has to be undertaken to acquire luxury products contributes to the perception of a product as a luxury (Dubois et al, 2001). Price is a factor that adds to the valu-ation of a product in the consumer mind and may stimulate the perceived extra sign-value inherent to luxury products. Though other characteristics may be signifi cant in the perception of luxury products, the psychological factor assures that quality and price are the strongest and often support other characteristics. Consequently they have to be present regardless of community interests or use.


3.4 The Emergence of Luxury

3 4 1 Basis of Luxury Products

Valuation of products is dependent on certain facets. Earlier several relative notions concerning luxury were addressed. This implies luxury is perceived diff erently according to, for example, culture. In order to identify the fac-ets that infl uence the perception of luxury products, a theory developed by Reinmoeller is addressed that explains the emergence of luxury. He states that luxury products are synonymous with the highest levels of appreciation. Ap-preciation of product experiences is the enjoying, understanding and judging of products according to him. He states that without appreciation a product cannot deliver pleasurable experiences. Luxury appreciation is infl uenced by knowledge and context (Reinmoeller 2002). These two notions are investi-gated in the next chapters.

3 4 2 Knowledge Aff ecting Luxury

Reinmoeller states knowledge is formed by information, is dynamic, relation-al and dependent on context. It is created through social interaction between individuals that refl ect their values and commitment through it (Nonaka and Takeuchi 1995 in Reinmoeller 2002). Reinmoeller states two types of knowledge can be identifi ed: explicit knowledge and tacit knowledge. Explicit knowledge is objective knowledge and can be expressed easily. One can, for example, express the material qualities of a product by saying it is made of a certain kind of material. In contrast tacit knowledge is not easy to articulate due to its subjective nature. As a result the communication of tacit knowl-edge is complex. This knowledge is personal and is refl ected in one’s actions, contexts and values according to Reinmoeller. Examples he mentions of tacit knowledge are intuitions, preferences, insights and feelings. Both knowledge types infl uence each other. Through the interaction between the two, knowl-edge is formed, according to Reinmoeller. The appreciation of luxury involves both explicit knowledge and tacit knowledge (Reinmoeller 2002). Explicit knowledge of high material qualities is not suffi cient to qualify a product as a luxury product, but needs to be complemented by some form of tacit knowl-edge that creates the product sign-value for the consumer. The consumption of the product may then be pleasurable and meaningful.

3 4 3 Context Aff ecting Luxury

Reinmoeller states that interaction processes in context are the basis of ap-preciation that is created over time with knowledge. Several kinds of contexts may infl uence luxury appreciation, for example physical, temporal, cultural, technological, historical, economic and social context. He argues social con-text is the most important in the emergence process of appreciation of luxury.

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The valuation of products is determined by the social contexts in which they emerge according to Reinmoeller. Continuous interaction of people who share interest and knowledge determine the appreciation of products and therefore luxury products (Reinmoeller 2002).

Nonetheless other contexts infl uence the appreciation of luxury products as well. A need in one society may be a luxury in another as mentioned earlier. Diff erent societies have diff erent backgrounds and social structures, which aff ects their idea and perception of luxury. Carcano and Catalani (2005) high-light the importance of cultural context because of the inherent sign-value of a luxury product. For example Chinese travellers with modest means are more likely to pick up expensive luxury brand products to bring back home nowadays unlike their European counterparts (Yu et al 2006: 120). This sub-sists in their diff erent background and valuing of those particular products, but partly also in the fact that China is in a diff erent phase of consumerism.

Though China, as well as other countries like India, Brazil and Russia, is catching up fast, they are still in an early phase of luxury consumption accord-ing to a theory developed by Anterior:Insight, a consumer-focused insight agency. The theory distinguishes four diff erent stages of luxury in today’s world. The fi rst stage is conspicuous consumption, which manifests itself in the luxury consumption of the new rich and emerging middle classes in coun-tries like Brazil, Russia, India and China. The second stage is termed ‘selective extravagance’ by Anterior:Insight and manifests itself in Japan, Europe and the US. Increasing knowledge causes consumers to be more selective in their consumption practices, which is shown through high levels of commitment with goods, services and brands. Thirdly the stage of ‘conspicuous abstention’ is mentioned by Anterior:Insight. This stage manifests itself in controlled and refi ned consumption practices based on knowledge. Cultural and intellectual display in products become more important than the conspicuous brand. The last stage is experiential luxury, where the focus shifts from materialism to experiences (Anterior:Insight 2006).

The theory developed by Anterior:Insight can be seen as an evolution of luxury, but more so it is interesting to see that these diff erent ideas of luxury may exist next to each other. This may be in diff erent cultures as mentioned earlier, but also within a society based on diff erent knowledge and context. Countries that are in the stage of conspicuous consumption will adopt new thinking of luxury based on their future development, which may manifest itself diff erently than in Western Europe. Despite the addressed evolution, tra-ditional luxury consumption in the form of conspicuous consumption is still apparent in Western European societies. The diff erent stages of luxury men-tioned by Anterior:Insight may thus correspond with various forms of luxury. Luxury may manifest itself in diff erent ways, particularly when copious diff er-


ent lifestyles and consumption patterns exist that stimulate diverse knowledge creation and gathering. Thus communities in societies may develop forms of luxury based on knowledge and context and interpret them accordingly.

3 4 4 Luxury within Communities

The knowledge creation that is the base for luxury appreciation is formed by ‘communities of interest’ according to Reinmoeller. He mentions that communities of interest are groups of people that have common interests and knowledge and share a passion for similar products, qualities, ideas and values. Interaction within these communities supports further knowledge ac-cumulation and exchange and supports the self-refi nement of the individual (Lave and Wenger 1991 in Reinmoeller 2002). Intensifi ed, growing interaction tends to increase size of communities, whereas declining interest and interac-tion among members tends to decrease size. Reinmoeller states that com-munities extend their knowledge by direct interaction between members, but also through addressing literature and blogs. Communities can be extremely diverse because of multiple factors, for example cultural background and profession (Reinmoeller 2002). As a result people may be members of more than one community of interest in contemporary society based on multiple interests and situational context, for example when working or spending free time. Instead of traditional layers of social classes, society may be structured through communities of interest (see fi gure 3.1) where people may move free-ly between them according to for example increased knowledge or changed interest. The model acknowledges the fact that some communities of interest are not attainable due to for example monetary reasons or restricted access options by members. Furthermore the model is based on a fl uid hierarchy in society that is made possible by multiple changes in society. These changes are discussed in chapter 4: Perspectives of Luxury.

Luxury can be seen as pleasure with products that emerges through interac-tion within communities (Reinmoeller 2002). This interactivity results in a

Figure 3.1 Changing society structure

High Social Class

Low Social Class

Middle Social Class

Rigid society structure based on hierarchy

Fluid society structure based on communities of interest

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shared understanding and experiencing of products and therefore the emerg-ing of appreciation of products. This results in appreciation of products that can lead to products becoming seen as a luxury, that is, only if the product is highly recommended and understood within the community of interest ac-cording to Reinmoeller. The shared understanding of qualities and meanings of products is important in the individual’s appreciation of these products (Reinmoeller 2002). This corresponds with the idea that a luxury product should be widely desirable, at least within the community of interest. The un-derstanding and recommendation of the products by people is dependent on the sign-value that a product off ers for the community of interest. If a product is lacking one’s interest because of diff erent knowledge or diff erent context, it will not correspond with the highest levels of appreciation and may not be considered a luxury, attainable or not. This clarifi es Mortelmans’ ideas about luxury as a social phenomenon apparent in all layers of society. He men-tions that every community can have its own diff erent type of luxuries. As an example he emphasises that a product that is traditionally considered a luxury good, such as a Cartier watch, does not have to be considered a luxury good in a particular community, whereas a television may be considered a luxury good in that community (Mortelmans 2005).

3 4 5 Types of Luxury

Based on the continuous knowledge conversion process theory developed by Nonaka and Takeuchi, Reinmoeller identifi ed four types of luxury knowledge processes, that is, luxury patterns, emerging luxury, new luxury and luxury brands (see fi gure 3.2). Luxury patterns are criteria for luxury within a com-munity (Reinmoeller 2002).

Figure 3.2 Types of luxury

Emerging Luxurysharing and

creating of tacit knowledge

through direct experience

New Luxuryarticulating tacit

knowledge in refl ective dialogue

(metaphors, prototypes)

Luxury Patternslearning and

acquiring new tacit knowledge in

practice

Luxury Brandssystemising and applying explicit knowledge and

information

Tacit knowledge

Taci

t kn

ow

ledg

e

Explicit know

ledge

Explicit knowledge

Source: ReinMoeller 2002


These luxury criteria may vary in importance within diff erent communities of interest dependent on for example culture and interest. They are under constant development relative to the continuing development of knowledge and context, which infl uence communities. Traditional examples of these criteria are scarcity, exclusivity, quality, aesthetics and price. Often a combi-nation of several luxury patterns is required for a product to be considered luxurious. Emerging luxury is based on tacit knowledge and related to new experiences and new product categories as stated by Reinmoeller. Often this is the result of interaction and sharing of experience within small communities that discloses new pleasure for the members of the community. The sharing of experiences concerning newly discovered tacit knowledge is key in the pro-cess of emerging luxury (Reinmoeller 2002). New luxury is making emerging luxury explicit knowledge by articulating related tacit knowledge. Examples of this are the mouth-to-mouth communication and more recently also the distribution of that knowledge through community websites or magazines, although mouth-to-mouth communication remains the most trusted type according to Reinmoeller. Often metaphors, images, concepts, diagrams, nar-ratives or prototypes are used to establish easy communication means. This could be a basis for new luxury products within communities (Reinmoeller 2002). The last type focuses on the building of the brand through visuals, aesthetics, symbols, advertising etc. Luxury brands are therefore refl ected through explicit knowledge. Usually the more the brand is exposed, the less it will be seen as a luxury (Reinmoeller 2002).

The four types of luxury can also be seen in a dynamic approach according to Reinmoeller. They interact and build on each other. Luxury patterns are often platforms for emerging luxury products and may be seen as the starting point of the development of luxury according to Reinmoeller. He states that if communities of interest are appreciating products and share the experience with others, luxury may emerge. Consequently emerging luxury may have the smallest community of interest, because the luxury experience is new and based on tacit knowledge. Emerging luxury can eventually result in new luxury and consequently the community of interest may increase or change. The original community of interest may reject the product as a luxury after it is adopted by another larger community of interest depending on the initial purpose of the luxury product. Continuing developments result in constant adoption and rejection of luxury products in communities. Nevertheless luxury brands can develop based on larger communities of interest and identi-fi ed luxury patterns. Luxury brands have the largest community of interest, because of fast and wide communication of the concretised luxury experience according to Reinmoeller. The four types of luxury are diff erent in nature and therefore diff erent strategic approaches are to be considered. The success of these strategies is dependent on the use and facilitation of communities of

3736

interest (Reinmoeller 2002). Luxury perception and motives of societies may be relative to existing and emerging luxury patterns made explicit by luxury brands within communities of interest.

3.5 Towards a Framework for Luxury Products

The theory discussed provides an insightful view in recent defi nitions and opinions of what constitutes a luxury product. The material discussed ap-proaches the concept from diff erent angles, nevertheless similarities may be found. In multiple ways they also complement each other. Consequently a framework is developed based on the reviewed literature and insights. The most consistent factor in the theories is the relative factor luxury inhabits, which thus makes the notion of a luxury product also a relative one.

The most prominent relative factor is the dependence on knowledge and context within communities of interest. Therefore it is useful to illustrate the process of the emergence of luxury (see fi gure 3.3).

The model shows the interaction within communities between fi rstly explicit and tacit knowledge and secondly between knowledge and context. A product that is part of those processes is valued accordingly. The highest levels of appreciation may eventually result in the perception and constitution of a product as a luxury within that particular community. The valuation of a product is thus relative to the same processes. This process is used to inves-tigate the relations between the previously discussed theory and results in a framework for what constitutes a luxury product.

A luxury product is a result of the highest levels of appreciation within a community of interest as stated by Reinmoeller (2002). Luxury patterns are a form of explicit knowledge and are used to support the valuation of a product as a luxury. The relative expensiveness of a product is a form of

Figure 3.3 Emergence process of luxury

Product

Community of Interest (CoI)

Highest levels of appreciation

within CoI

Explicit knowledge

Tacit knowledge

Contexts

Luxury product

Source: Visualisation by the author based on theory of Reinmoeller (2002)


explicit knowledge despite the fact it often implies other characteristics that are desired by consumers. Quality may be one of those characteristics. The possible infi nite refi nement of a good together with the link of a generic universal need addressed by Berry suggests that a luxury product is of a better quality than a comparable product. Context and knowledge infl uence the perceived refi nement in the community of interest as well. This, together with tacit knowledge of the community, may cause the product to be consid-ered a luxury. Tacit knowledge may be refl ected in the sign-value addressed by Mortelmans (2005). Sign-value in products is used to give additional meaning and is often of a symbolic character and hard to defi ne, which may be relative to tacit knowledge. Therefore sign-value of a product may address tacit knowledge of a consumer. Pleasure that is important in a luxury product (Vigneron and Johnson 1999, Berry 1994: 41) may be derived from the sign-val-ue of a product. The fact that a product should be appreciated and therefore widely desired (Berry 1994: 41) in a community of interest may be relative to all previously mentioned notions. Because of the satisfaction a luxury product provides through pleasure and quality and because it comprises the highest level of appreciation, it is widely desired among members of the community. The developed framework (see fi gure 3.4) proposes universal factors of a luxury product.

Because of the relative notion of a luxury product, the framework helps to clarify what the minimum requirements of a luxury product are based on diverse literature sources. Communities of interest, infl uenced by their gained knowledge and surroundings, defi ne the valuation of a product and therefore a luxury product. Communities of interest may therefore have their own thoughts on what constitutes a luxury product apart from the notions in the initial framework. Therefore, luxury patterns and sign-value may be added to

Luxury product

Pleasure

Sign-valueLuxury patterns

Relatively expensiveQualitative better than a

comparable product

Widely desired

Figure 3.4 Universal factors of a luxury product

3938

the framework to further narrow down luxury products in a community of interest.

In the remaining chapters two perspectives of luxury are addressed result-ing in motives to consume luxury products. The perspectives are rooted in two characteristics of luxury identifi ed earlier: diff erentiation and pleasure. Contemporary views concerning luxury and societal change are discussed to frame the perspectives accordingly.

4Perspectives of Luxury

Chapter four outlines two perspectives of luxury. These perspectives are partially clarifi ed through charting societal change. Each perspective reveals dominating motives for the consumption of luxury. Accordingly a framework of motives is proposed.

Chapter four Perspectives of Luxury

4.1 The Indefi nable Character of Luxury

In the previous chapters the relative character of luxury was addressed. The infl uence of history, as well as current analyses of the concept, suggest an indefi nable character of luxury. Consequently the developed framework of luxury goods is conditional to changing factors, that is, sign-value and luxury patterns related to communities of interest.

A recent study by Cautela et al (2007), attempts to provide clarity concern-ing the many faces of luxury. The study suggests several descriptors from which conventional and new forms of luxury can be clarifi ed. They state that a universal defi nition of luxury is not feasible anymore, because the concept of luxury is associated with diverging notions such as subjective-objective, traditional-contemporary and material-immaterial. Luxury therefore should be approached from a wider scope instead of trying to incorporate it into one concept according to Cautela et al. The feasibility of luxury as one economic market sector is therefore not realistic (Mortelmans 2005). The descriptors have been identifi ed based on conventional ideas about luxury derived from the economic luxury sector and the infl uential study of Silverstein and Fiske (2005) concerning the ‘new luxury’ market. In total six descriptors were found, which are polarised in two clusters: ‘consciousness luxury’ and ‘follow-ing luxury’. The descriptors, together with the clusters, have been illustrated in fi gure 4.1. Following luxury represents a side that is about the communica-tion of status, whereas consciousness luxury is more projected toward oneself (Cautela et al 2007).

The fi rst descriptor is about the receiver of the luxury message. Luxury has been mostly analysed as a hetero-referred product up to the recent past (Vi-gneron and Johnson 1999, Cautela et al 2007). Whereas in recent times luxury is seen as something that can be for oneself as well, without communication to other people (Vigneron and Johnson 1999, Dubois and Laurent 1996 in De Barnier et al 2006). The second descriptor concerns the deeper meaning

4 Perspectives of Luxury

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behind luxury. Traditionally luxury was used to show off . In advanced indus-trialised societies with mature capitalism this is only present between classes where distance is still wide and diffi cult to reduce, because the affi rmation of lifestyle is used in society to diff erentiate horizontally according to Cautela et al. In the cluster consciousness luxury the meaning of fulfi lment may be given to luxury. Gratifying oneself or rewarding oneself to recover from something is an example of this. The luxury descriptor that describes the relation with time has on one side eternity and on the other the hic et nunc. The eternity relation is closely linked with the fact that luxury is expected to be of endur-ance and should be able to withstand the passing of time as said by Cautela et al. They state a new arisen thought about luxury is the hic et nunc attitude, where one is able to represent oneself according to the moment, refl ecting one’s emotional state or mood. Whereas luxury used to be about diff erentiat-ing oneself from other classes in society, with the arisen affl uence in advanced industrialised countries, the indication of belonging to a lifestyle, commu-nity or movement has become more important and thus the indicating of membership. This describes the fourth descriptor. The relation of luxury with other products or symbols is the fi fth descriptor identifi ed. Cautela et al suggest luxury used to go only with luxury to defi ne the social class. Today luxury may be mixed with other products and services. A good example is the fashion world, where for example an extremely expensive Bulgari necklace is worn besides ZARA jeans. The last descriptor is related to access options. Whereas it used to be about ownership, the emphasis changed to posses-sion in the time when you need something. For example rental services for borrowing jewellery or bags have become immensely popular (Cautela et al 2007). One example is the company Bag Borrow or Steal (www.bagborrowor-steal.com).

The study by Cautela et al indicates the indefi nable and changing charac-ter of luxury. Therefore the analysis is useful, because it supports the idea

Figure 4.1 Luxury descriptors and clusters

message/addresseedeep meaning

relation with timerelation with reference social groupsrelation with other products/symbols

access option

self-referredfulfi lment

hic et nuncmembershipco-existence

possession

hetero-referredostentationeternitydistinctionabsenceproperty

Descriptors

Consciousness luxury cluster

Following luxury cluster

Source: Cautela et al 2007


of diverse use of luxury among individuals. The identifi ed descriptors may interweave and go either way depending on the interest of the community. Nonetheless two main purposes can be identifi ed from the study. One is lux-ury as a means to communicate status or membership and the other is luxury for personal gratifi cation. These two perspectives are investigated further in this thesis.

4.2 Consumer Attitudes toward Luxury

In a study conducted by Dubois et al (2005), attitudes were measured toward the notion of luxury within 20 diff erent countries. Based on their data they identifi ed three diff erent attitudes toward luxury, that is, a democratic, elitist and distance attitude. These attitudes may help to identify changes and clarify general ideas about luxury from the consumers’ point of view.

The elitist attitude toward luxury may be associated with luxury for stratifi -cation as well as personal gratifi cation purposes. The beliefs the respondents have is that only a few people should have access to luxury and as a result only few people own luxuries. This view corresponds with the ideas that luxury is very expensive, that one should be educated to enjoy these products and that luxury items can not be mass produced. The democratic attitude opposes the elitist attitude in almost every aspect. People with a democratic view on luxury are very open-minded toward the topic. They think luxury is avail-able for everyone and almost everyone has products that are a luxury. This corresponds with the idea that no special education is needed to enjoy these products, they can be mass produced and that they do not necessarily have to be expensive. This attitude also incorporates the belief that luxury is not an instrument to diff erentiate oneself from others in contrast to the elitist view on luxury. ‘Luxury is good and should be available for everyone’ is a strong belief of people with a democratic view on luxury. The third attitude sug-gested by Dubois et al is the distance attitude. This attitude is, in contrast to the previous two, negative toward the notion of luxury. Respondents of the study are not attracted to luxury, do not know much about luxury and do not feel comfortable around luxury. They regard luxury as useless, expensive and wasteful and associate it with being old-fashioned and snobbish (Dubois et al 2005). Overall this attitude is negatively directed toward luxury. It is likely that the main idea about luxury, considering this attitude, is based on the general concept rather than on the consumption of luxury products, which could explain the negative character. However, for our study this attitude is irrelevant due to its negative character.

Dubois et al projected the average attitude of the twenty countries where the study was conducted in a framework (see fi gure 4.2). They also briefl y addressed the possible positive relationship between the democratic attitude toward luxury and a stable society by comparing the levels of uncertainty

4544

avoidance and power distance from Hofstede’s framework with the demo-cratic position in their framework. The results seemed to be in line with their hypothesis. In addition they pointed out the possible infl uence of religion seeing that the democratic attitude of luxury correlates with nations that have a strong protestant infl uence, while the other two attitudes are closer to his-torically catholic societies. Societies that have strongly developed postmodern values were in most cases historically protestant (Inglehart 2000). The demo-cratic attitude toward luxury may therefore be particularly evident in societies with postmodern values.

The three attitudes represent extremes. Considering people may be members of more communities of interest and may have diff erent ideas related to the general concept of luxury, these attitudes may not be rigid and may change according to personal preferences and context. Therefore one may suggest that elitist and democratic thinking toward luxury may intertwine to suit one’s personal values and goals. Nevertheless the positioning of the countries shows the commonly present mix of attitudes in a country and may specify the most infl uential one of the three. A country that is located close to the democratic attitude toward luxury may most likely be less infl uenced by the elitist attitude when consuming luxury and vice versa.

Figure 4.2 Positioning chart of countries relative to attitudes

DenmarkNew Zealand

The Netherlands

Norway

USA

Portugal

SpainItaly

Hong Kong

Hungary

Belgium

Sweden

UKFrance

PolandAustraliaAustria

Canada

GermanySwitzerland

Democratic

Distance

Elitist

Source: Dubois et al 2005


4.3 The Traditional Perspective of Luxury

4 3 1 Traditional Luxury and Consumption Today

The fi rst perspective that may be identifi ed is the social role of luxury. This perspective of luxury has the most visible link with the use of luxury in his-tory and is therefore named the traditional perspective of luxury. Luxury was used for stratifi cation purposes throughout history. Today this form of luxury is still evident in contemporary consumption society and has developed ac-cording to changes in society. Social class diff erences today are mostly present in the fi nancial situations of consumers and have become smaller due to economic growth and prosperity. The phenomenon of ‘trading up’, described by Silverstein and Fiske in their book Trading Up: Why Consumers Want New Luxury Goods... And How Companies Create Them (2005: 15, 16) contributed to the decreasing diff erence in perceived fi nancial diff erence as well, because consumers were able to spend signifi cant amounts of money on preferred activities or products. In addition, a phenomenon described as ‘rocketing’, could make the visible diff erences increasingly smaller as well. Rocketing is the spending of a large part of one’s income in only one or two product segments that are considered important (Silverstein and Fiske 2005: 6). Consumption caused people to move away from having an identity through work to creating an identity through consumption (Bocock 1993: 4, 50, 78, 79). The importance of individual expression, and with that style, pleasure and excitement among others, became more evident in the last decades of the 20th century, whereas before the social class boundaries were of more impor-tance according to Bocock. Partly this also caused a shift toward personal use of luxury that is elaborated further on in this thesis. Social class boundaries became thus more fl uid, causing people to move more freely between them (Bocock 1993: 80, 81). This allowed them to develop knowledge and apprecia-tion for products and become members of communities of interest. Next to class diff erences, attaining membership of communities of interest, may be equally or particularly more important concerning the consumption of luxury. The sign-value in luxury products is associated with high levels of appreciation. Thus consumption of luxury products may be used to create an aspired identity by the consumer and refl ect its values. Membership and dif-ferentiation may support this.

Mortelmans describes two forms of stratifi cation in society, that is verti-cal stratifi cation and horizontal stratifi cation. He states that luxury in verti-cal stratifi cation is used to distinguish oneself from other classes and is also used to indicate this, whereas luxury in horizontal stratifi cation is used to distinguish oneself within the social class itself to indicate exceptional class membership (Mortelmans 2005). The usage of luxury products in horizontal stratifi cation processes can be quite profound within the group, but can usu-

4746

ally not be recognised outside the social group. An example Mortelmans gives is the use of a technically superior tennis racquet that will give no excessive benefi ts in playing the game, but is primarily used as a sign-value to diff er-entiate. It requires special knowledge to recognise the diff erence from other tennis racquets and that quality is therefore used in the horizontal stratifi ca-tion process. This can also be seen within the car industry, which produces diff erent versions of comparable cars. These versions are often used in hori-zontal stratifi cation processes. For example a BMW 520i has a consumer price of €45.970,-, whereas a BMW 540i has a consumer price of € 71.300,- according to a Dutch price list of April 2008 (http://www.bmw.nl/nl/nl/index_narrow-band.html). For someone who cannot aff ord a BMW 5 series sedan, these cars are perceived as being similar. This is supported by the outside form of the car that is almost identical. However, among people that can aff ord the car, the diff erence between a 2.0l and 4.0l engine may be signifi cant for stratifi cation purposes within the social class.

Vertical stratifi cation is primarily focused on the diff erences in social class. In contemporary society products to support vertical stratifi cation may be used, for example, to signify wealth. Vertical stratifi cation in society with, for example, uniforms indicating professions is outside the scope of this thesis and may not be relevant in relation to economic luxury consumption prac-tices. Horizontal stratifi cation in order to indicate exceptional class member-ship may be projected onto communities of interest. This form of stratifi ca-tion is particularly noticeable and may verify the dedication of a member in the community of interest. A high quality lens for a SLR (Single Lens Refl ex) photo camera may be used to diff erentiate among amateur photographers. The lens may indicate comprehensive knowledge and create credibility and status among the members. The posting of a photo on an internet blog dedicated to photography may increase attention and infl uence appreciation when the lens is mentioned alongside the photo.

The elitist attitude identifi ed by Dubois et al in their study corresponds with consuming luxury for stratifi cation purposes. Luxury is viewed as something exclusive and as a means to diff erentiate for consumers that have an elitist attitude. The elitist attitude corresponds with the idea of luxury as a means to distinguish oneself vertically in a social class or community of interest.

4 3 2 Dominating Traditional Motives

The motives of luxury consumption innate with the traditional perspective of luxury correspond with the desire to diff erentiate oneself from others. The elitist attitude may play a signifi cant part in the consumption of luxury for diff erentiation. Diff erentiation is a social phenomenon and involves commu-nication between people. Therefore these motives are hetero-referential. This corresponds with the following luxury cluster of the descriptors identifi ed by


Cautela et al (2007). From the following luxury cluster, two notions that have a communicative role can be recognised from their study: distinction and ostentation (see fi gure 4.1). These notions have also been recognised in a study concerning prestige-seeking consumer behaviour by Vigneron and Johnson (1999).

Though the addressed study here is directed toward prestige-seeking behav-iour, the motives identifi ed are in line with recent research concerning luxury by Cautela et al. Dubois and Czellar (2002) also state prestige is the word that is used most next to luxury to refer to brands and their products that hold extensive intangible value. Although prestige is in some cases interchange-able with luxury (Vigneron and Johnson 1999) and in some not (Dubois and Czellar 2002), prestige is regarded as an essential part of a positive luxury experience as the study by Dubois and Czellar revealed. In addition motives for diff erentiation through consumption of luxury may be seen as convey-ing status to others and may therefore be a form of prestige. In fact prestige is associated with human success (Dubois and Czellar 2002). Therefore the motives identifi ed by Vigneron and Johnson (1999) are useful for our purpose and are elaborated upon further below.

The study by Vigneron and Johnson is based upon various infl uential works regarding behaviour related to prestige and luxury and may be seen as an extensive summary. Earlier in this thesis conspicuous consumption was already addressed. The main purpose of this is to show others what you have and where you belong or aspire to belong, in other words to impress others. This motivation of why people want to consume luxuries is linked to valuing conspicuousness as said by Vigneron and Johnson. They state conspicuous consumers tend to display wealth and through that power and status. There-fore these consumers have a preference for highly visible characteristics of the product, which can, for example, be indicated by a visible brand name. In-creasing the price of luxurious products would increase the amount of goods sold among these customers, because it would be considered more expensive and thus better to indicate status (Vigneron and Johnson 1999). This eff ect is known as the Veblen eff ect that is named after the economist Thorstein Veblen (Leibenstein 1950 in Vigneron and Johnson 1999).

A second reason to consume luxuries for diff erentiation purposes can be found in wanting to be unique. To increase one’s status the consumption of goods that are rare or scarce is preferable according to Vigneron and John-son. The behaviour that is linked to this is the snob eff ect (Leibenstein 1950 in Vigneron and Johnson 1999). Status seeking consumers will stop buying goods when they consider them too popular or too widely consumed by the mass. Goods that are scarce are perceived with a higher value than goods that are not, they command respect and prestige (Solomon 1994: 570 in Vigneron and Johnson 1999). The snob eff ect may also occur when a prestige product is

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launched in order to take advantage of the fact that few consumers possess it in the beginning, for that reason the snob will adopt the product (Mason 1981: 128 in Vigneron and Johnson 1999). The main reason again for this behaviour is to diff erentiate oneself from others. This behaviour may be especially eff ec-tive in the horizontal stratifi cation process to indicate exceptional member-ship in community.

Vigneron and Johnson identifi ed another motive regarding prestige-seeking behaviour, which is to secure group membership. Conformation to a commu-nity standard may be a motive for luxury consumption as well. Nevertheless this could be a function of diff erentiation if the main motive is to distinguish oneself from other classes through membership. Expressing membership for this purpose may fi t with the elitist attitude and traditional perspective of luxury. The phenomenon related to this is the bandwagon eff ect (Leibenstein 1950 in Vigneron and Johnson 1999). The bandwagon eff ect can be described as follows: when preference for goods increases, demand increases as well. This eff ect is closely related to the snob eff ect and may trigger snob behaviour. When a product becomes too familiar and is possessed by many, it loses its function to distinguish and therefore its status.

Cautela et al (2007) state that expressed membership opposing distinction is a new form of luxury. Belonging to a life-style and sharing the thoughts and pleasure related with it, therefore indicating membership of a commu-nity, may be a purpose of luxury opposing status conveying use (Cautela et al 2007). When luxury is used to indicate membership without the purpose of diff erentiation from other groups, but for example for constructing self-iden-tity, it may be seen as a motive for luxury consumption relative to the demo-cratic attitude toward luxury. Here the democratic and elitist attitude may infl uence the initial purpose of attaining and expressing membership.

Sign-value and luxury patterns have to communicate these motives in order to be successfully perceived as a luxury product that is used in diff erentia-tion and membership. According to the luxury patterns and sign-value that conform the perception as a luxury product in a community, other character-istics may be present as well. Nevertheless the luxury patterns and sign-value that communicate diff erentiation or membership may be dominant in the initial consumption of the luxury product if diff erentiation or membership is desired.

4.4 The New Perspective of Luxury

4 4 1 A New Emphasis in Luxury Consumption

The study by Cautela et al (2007) suggested a use of luxury outside the com-municative character. Together with the identifi ed democratic attitude in contemporary European society in the study by Dubois et al (2005), these


studies point to a changing character of the use of luxury. The proposed evo-lution theory of Anterior:Insight addressed earlier highlights other possible views toward luxury. Luxury is present in many forms because of diff erent views and attitudes toward the concept of luxury. Recently these changed views of luxury gained vigorous attention from several sources. Terms like new luxury and responsible luxury represent new ideas about luxury that may have become possible because of an altered perception of luxury. Firstly new ideas about luxury are often associated with the democratisation of luxury, secondly are also linked with feelings and experiences (Danziger 2005: 19). The democratisation of luxury involves the availability of products and services perceives as luxurious to more social classes than only the very affl u-ent. Instead of using luxuries primarily for communicative purposes, they are increasingly used for private pleasure and gaining experiences (Danziger 2005: 7, 19, 21). This is also in line with the fact that time is getting more important and seen as a luxury in today’s fast paced world. Several changes in society are addressed that presumably have had a substantial infl uence on the emergence of a new perspective of luxury in contemporary society in Europe.

The Zukunftsinstitut (www.zukunftsinstitut.de) in Germany conducted research related to changed perceptions of luxury in 2005. They identifi ed several aspects that are diff erent from the classic notion of luxury that are illustrated in fi gure 4.3. It suggests that individuality is increasing signifi cantly in importance in comparison with luxury as a means to convey status. The well-being of the individual is more important, which results in a more in-ward directed kind of luxury. This is in line with the postmodern values that Inglehart (2006) identifi ed, which are addressed in the following chapter.

4 4 2 Change of Values

Globalisation is something that has had vast infl uence on the perception of luxury. Information became increasingly more easily accessible for people,

Status, prestigeSocial differentiationCompetitivenessSociety of the massesCadillac, Patek, GucciFetishMore money

Social functionConsumption motiveUnderlying conceptEraObjectsObject relationLife goal

More life qualityIndividual well-beingInner-growthSociety of the individualMass customisationQuality of service and experienceMore time

Status luxury New luxury

New luxury: The diversifi cation of the notion of luxury

Source: Zukunftsinstitut GmbH (derived from Jurik 2006, translated by the author)

Figure 4.3 Status luxury versus new luxury

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thus increasing knowledge of consumers. This caused consumers to be aware of multiple lifestyles through the media, internet and other forms of mass communication. Increased knowledge and awareness caused people to aspire to and therefore imitate those lifestyles.

The Industrial Revolution in the 18th century led to the industrialisation of Europe. Many new technologies were invented and introduced and as a result the economy grew rapidly. The money available for investments rose, result-ing in making the economy growth increase more. This resulted in a modern capitalist economy (Bocock 1993: 14, 15). The modern capitalist economy brought great benefi ts with it, for example longer life expectancy and more security (Inglehart 1997: 59, 60). As a result the emphasis was on economic development to improve life conditions.

However, when a certain point in the economy’s development of a society is reached, the benefi ts of a higher life expectancy fade away. When the average income reaches a high level, a higher level comes with minimum benefi ts regarding security and life expectancy in an advanced industrialised society (Inglehart 2000). Therefore the values shift from emphasising economic gains to lifestyle related issues (Inglehart 1997: 64) (see fi gure 4.4). Money will be less important for people than before, because they don’t see economic progress as the most important factor in life anymore. The overall happiness of advanced industrialised nations’ societies seems to be higher in comparison with other societies, but is approximately the same when a certain level of income is reached according to Inglehart (1997: 61).

Due to several factors, advanced industrialised societies like Western Europe, North America and Japan, have seen a change in values. These factors include the economic growth in the post-war era and a good welfare system that caused a general shift in thinking toward increasing life quality instead of em-

Figure 4.4 From economic gains to lifestyle

GNP/Capita

Surv

ival

and

wel

l-be

ing

valu

es

Eco

nom

ic g

ains

Lifestyle

Source: Inglehart 1997


phasising on generating economic growth (Inglehart 2000). Inglehart suggests two hypotheses that explain the recent shift in thinking that is mostly ap-parent in the younger generation that gives higher priority to self-expression and the quality of life. He states this is in opposition to the generation that experienced the war, which gives higher priority toward economic and physi-cal security. The fi rst hypothesis proposes the infl uence of scarcity. This sug-gests that one’s individual priorities refl ect the socioeconomic conditions of society. The highest priorities go to the things that are not present in a large supply. The second hypothesis is a socialization hypothesis, which suggests that a considerable amount of time is needed to change the values that were formed during the pre-adult years of a person. Most likely they will change relatively little after that (Inglehart 2000). Basing his research on data from the World Values Survey, he demonstrates that the older generation’s values are more pointed towards security and economic growth while the younger generation’s values are more directed toward self-expression, which manifests itself in materialist and post-materialist value types (see fi gure 4.5) (Inglehart 1997: 135, 140). If younger generations have been living in a stable society, only experiencing welfare their entire lives, it is feasible to believe they have strong-ly developed postmodern values, that is, values directed toward self-expression and secular-rationality. Economic growth and security are more or less taken for granted within younger generations. Therefore postmodern values are progressively more apparent in advanced industrialised societies due to the high level of economic security those societies off er (Inglehart 2000).

Perc

enta

ge

of

age

gro

up in

giv

en v

alue

typ

e

Ages 65+ 55–64 35–44 24–34 15–2445–54

50%

40%

30%

20%

10%

Materialist value type

Post-Materialist value type

(Postwar generation)


Figure 4.5 Materialist and post-materialist values relative to age

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Another factor in the adoption of postmodern values by society is the authority structure. Secular-rational authority in combination with economic growth and a stable society may result in postmodern values (see fi gure 4.6). After completion of industrialisation, when society is turning into a knowl-edge society, people’s values are switching from survival values toward self-expression and well-being values (Inglehart 2000). Inglehart and Baker (2000) found evidence that orientation of industrialised societies almost always shift from traditional values towards secular-rational values if security in a society increases. Self-expression values can develop in a society of trust and toler-ance and therefore postmodern values align well with democracies (Inglehart 2006).


Figure 4.6 Position of countries relative to values


People with postmodern values, who place emphasis on the quality of life and care about self-expression and well-being, may be present in advanced industrialised societies when the socialization hypothesis is considered. Figure 4.6 illustrates that Northern European societies are among the highest with developed postmodern values. These countries have had a stable society for a longer period including a good welfare system. Most of them also seem to have a historically protestant background that had allowed economic ac-cumulation by individuals, which opened up the way for modern capitalism and industrialisation (Inglehart 2000, Bocock 1993: 11, 39).

Industrialisation has had a major impact on society and has given rise to new values of people. Postmodern values are getting stronger in all advanced industrialised societies because of lengthy prosperity resulting in a stable so-ciety. Thus postmodern values may have caused the emergence of the demo-cratic attitude toward luxury and may have caused the beginning of the new perspective of luxury.

4 4 3 New Consumer Attitudes towards Luxury

The changing values of people in advanced industrialised societies have had a major infl uence on the market place. Lewis and Bridger created a framework that suggests diff erences between ‘old consumers’ and ‘new consumers’ that have been signifi cantly infl uenced by contemporary consumption society (see fi gure 4.7). They state that the framework should not be seen as rigid, but more or less as two extremes, resulting in fl exible consumers that can adopt either side (Lewis and Bridger 2001: 19). Therefore this framework may show the infl uence of the development of consumers in advanced industrialised societies as postmodern values become increasingly present. One could as-sume that old consumers are more infl uenced by modern values that have been about creating economic growth and security, whereas new consumers are more infl uenced by postmodern values that refl ect individuality and self-expression.

Gilmore and Pine II suggest that after the Agrarian Economy, Industrial Economy and Service Economy, now the era of the Experience Economy

Figure 4.7 New consumers vs old consumers

Seek convenienceSynchronisedLess often involvedConformistLess well informed

Seek authenticityIndividualInvolvedIndependentWell informed

Old consumers pole New consumers pole

Source: Lewis and Bridger 2001: 19

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has arrived. Consumers are increasingly looking for experiences rather than products (Gilmore and Pine II 2007: 2, 3; Danziger 2005: 19; Dryza 2006). This is in line with Ingelhart’s study that identifi ed a shift away from materialist values. A product may have become a means to an end to refl ect values and support self-actualisation. The Industrial Economy caused the market to be saturated with goods. A response to the saturation was the transition from controlling costs to improving quality in the Service Economy (Gilmore and Pine II 2007: 3). This led to consumers increasingly demanding better quality as they refused to deal with poor quality. Because of the high level of competi-tion, new forms of selling were established, resulting in companies emphasis-ing progressively on immaterial services and experiences to set themselves apart from the competition. This new capitalism is referred to as the ‘Age of Access’ by Jeremy Rifkin (Ebel 2004) where producing desires and experi-ences are stressed instead of merely producing products. This shift may have caused or may cause a change in the luxury patterns of those societies. The identifi cation of luxury atmospherics as an important luxury facet in the UK (De Barnier et al 2006) may be an example of this, because the emphasis is on experience rather than ownership. Services and product surroundings have become more important. Furthermore branding has become essential for the survival of companies and their off erings, because through branding a story and image may be created that is essential for being recognised in today’s competitive market. This can be traced back to when producers and mer-chants began to use symbolism in marketing to express the intangible desires of consumers (Carcano and Catalani 2005). Products may be given sign-value through symbolism and story telling. Thus changing market practices may have infl uenced consumers’ perception of luxury.

Gilmore and Pine II suggest that authenticity is what consumers today are increasingly looking for. They base their thoughts on the fact that consum-ers are purchasing products to conform to and reinforce their self-image. Products that do not refl ect the consumer’s image are seen as inauthentic, as a result authenticity should be seen as personal (Gilmore and Pine II 2007: 7). Premium prices are paid for authentic products (Gilmore and Pine II 2007: 10). This corresponds with the changing perception of quality described in the following chapter. Consumers are appreciating real quality more, that is, rationally and emotionally understandable quality (Carbonaro and Votava 2005). The quality segments ‘standard’ and ‘excellence’ that are described in the following chapter are convincing for consumers due to their authentic-ity (Carbonaro and Votava 2005). A new facet that needs to be addressed in a product resulting in the highest levels of appreciation within a community of interest may be authenticity. Thus authenticity may be an increasingly vital luxury pattern in contemporary society for new consumers.


4 4 4 Changes in Perception of Quality

Earlier the phenomenon trading up was addressed. Related to this phenom-enon is the actuality that markets in the middle segment are struggling and are forced to choose between the upper or lower segment due to changes in consumer behaviour (Schögel and Schulten 2005). A model by Becker illus-trates the principle of trading up for the market (see fi gure 4.8).

Fundamental to this phenomenon are the changes in buying behaviour by consumers. Consumers today are able to recognise quality better than before, which makes them more aware of highly qualitative products and the intan-gible benefi ts they provide, for example pleasure and feeling good. Together with the changing gender roles after the Second World War, the change in family structure and increasing lifestyle importance, this caused consumers to question the quality of products in the middle segment of the market (Car-bonaro and Votava 2005).

Objective quality of products in the lower and middle segment of the mar-ket has become of a similar high standard making it diffi cult for consumers to distinguish products apart by price. Consequently commodities are expected to be inexpensive. Consumers will almost certainly choose the cheapest prod-uct available if they have to buy a commodity (Carbonaro and Votava 2005, Schögel and Schulten 2005). On the other hand consumers are willing to pay signifi cantly more for products that off er sign-value on top of the basic func-tional features. Sign-value may for example be refl ected in an off ered history, experience or other intangible value and therefore justify the higher price. Meaningful sign-value is refl ected in personal tacit knowledge of consumers and often hard to concretise. Thus consumers expect high objective quality from commodities and extra added value from luxury products. The model in fi gure 4.9 shows the transformation of the classic quality perception to

Figure 4.8 Trading up for the marketplace

Top market

segment

Middle market segment

Lower market segment

Loss of the middle

market segment

Trading up

Source: Jochen Becker 2001 (derived from Schögel and Schulten 2005, translated by the author

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the new quality perception of consumers (Carbonaro and Votava 2005). The model is related to the model of Becker, but focuses on the quality perception of consumers and may be seen as the cause of the phenomenon illustrated by Becker.

The new quality categories correspond better with contemporary society in relation to the changed society structure and new consumer attitudes. Quality for consumers encompasses aspects beyond the tangible quality of for ex-ample material quality. Carbonaro and Votava created a model that suggests four value domains with at basis the notion of quality (see fi gure 4.10). These forms of quality focus on emotional and subjective factors.

Consumers are consuming progressively to fulfi l their individual expecta-tions of life and support self-actualisation to match their personal values

Figure 4.9 A shift in quality categories

Source: Carbonaro and Votava 2005

Luxury

High quality

Standard quality

Low quality

Value shift

Excellence

Standard

Figure 4.10 Socio-cultural model of consumption

QualityWell-being

Life philosophy

Relationship

Trust

CuriosityDialogueService

Affi nity with natureTransparencyKnowledge

SociabilityTaste

Multi-sensuality

HealthStatus/security

Ethics



(Carbonaro and Votava 2005). The ‘socio-cultural model of consumption’ sug-gests that purchase decisions depend on the signifi cance for consumers and less on functionality or emotional seduction through marketing (Carbonaro and Votava 2005). Moreover the model suggests the motivation of consumers today to buy subjective qualitative products.

Trading down supports the trading up principle as cheaper, but qualitatively acceptable products, become less expensive. Therefore a larger part of the income is available for most consumers to purchase excellence products. This is illustrated by Carbonaro and Votava in fi gure 4.11. The model shows that these two segments are not independent from each other, but complement and are defi ned through each other (Carbonaro and Votava 2005).

The excellence category represents products with sign-value through which consumers can express themselves, which have become accessible due to discount products and rising affl uence. All things considered the excellence category allows a shift in the perception of luxury that is less directed toward indicating status and more directed toward self-actualisation (Carbonaro and Votava 2005). The shift of the quality categories suggested by Carbonaro and Votava, together with postmodern values, is related to the new perspective of luxury. The consumption of excellence products that refl ect the changed qual-ity perception is closely related to self-actualisation. Carbonaro and Votava (2005) describe the excellence category as the new luxury.

4 4 5 Dominating New Motives

Recent changes in society have caused the personal aspect of luxury consump-tion to become signifi cantly important. Changed quality perceptions as well as a democratic attitude toward the concept of luxury has caused luxury to

Excellence

Discount

Affective affi nityCultural relevanceStrong identifi cation potential

Defi nes standard qualityPrice orientedProduct oriented

“Enabler” “Challenger”

“Less but better”

“More for less”


Figure 4.11 Trading up and trading down supplement each other

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be consumed for self-actualisation. Personal gratifi cation has become increas-ingly important in luxury consumption. This is in line with recent research that pointed out that luxury products are also consumed for their intangible and subjective benefi ts (Dubois and Laurent 1994, Dubois et al 2001). Luxury products can be bought for one’s pleasure and are related to emotional responses such as aesthetic beauty, sensory pleasure or excitement (Alleres 1990; Benarrosh-Dahan 1991; Fauchois and Krieg 1991; Roux and Floch 1996; in Vigneron and Johnson 1999). People that consume luxury mostly because of their personal values and feelings and thoughts may be hedonist type of consumers (Vigneron and Johnson 1999).

More than anything people expect quality from a luxury product. It is expected that the quality of a luxury product is signifi cantly higher than that of a normal product. Because of the quality factor, luxury goods can be bought to be reassured of superior product characteristics and performance (Vigneron and Johnson 1999). Though this is true, the quality value of luxury in contemporary society may be diff erent from the quality value identifi ed by Vigneron and Johnson (1999). Quality nowadays manifests itself in a wider scope than objective quality alone. This can be seen in the socio-cultural model of consumption suggested by Carbonara and Votava (2005). The objec-tive quality factor as in for example material superiority loses in importance because of the changed quality categories. High objective quality is taken for granted within luxury; the reason of product quality reassurance may therefore not be valid anymore in contemporary society because this is of a standard high level today. The changed perception of quality interlinks with the perceived emotional value of the personal eff ects of luxury. The qual-ity lies in the intangible factors that correspond with the personal values of consumers today. These products, rich in quality and identifi ed as luxuries, correspond with the highest levels of appreciation within communities of interest. These intangible qualities refl ect the motivation of the consumer to consume luxury, which is identifi ed as such within advanced industrialised societies. Therefore consumers that consume luxury goods particularly for objective quality reassurance, identifi ed by Vigneron and Johnson (1999), may not be signifi cantly present anymore today.

The reasoning of hedonist type of consumers addressed by Vigneron and Johnson may be divided into two main notions based on the fi ndings ad-dressed earlier. That is on the one hand self-actualisation in the form of self-development, which can be for example seen when people are consuming luxury to support their self-image. On the other hand pleasure in the form of indulgence, which can be seen when someone for example wants to physical-ly or emotionally enrich themself. The perceived emotional value corresponds with one’s personal values, feelings and thoughts. Therefore these have be-come highly important in the consumption of luxury. However, luxury that


is used for self-actualisation, stresses the individual character and therefore refl ects personal motivation, is not entirely formed by the individual. The motivation and perception of luxury is still reliant on processes that take place within communities of interest (Reinmoeller 2002) to frame the perception of what constitutes luxury.

4.5 Framework of Motives

Consumers may use luxury for attaining membership to express belonging, but also for diff erentiating oneself. Within lifestyles and social classes luxury may be used to indicate exceptional membership as mentioned earlier. In addition consumers can be part of multiple communities of interest as men-tioned earlier and use luxury diff erently in those communities. The motives and attitudes identifi ed may therefore be used according to personal circum-stances. A product perceived as a luxury in one situation may not be one in another. For example an Armani suit may be successfully used for exceptional class membership and command respect during an individual’s day job. The same suit however, may be inappropriate in the individual’s living environ-ment, because it may be seen as showing off . If the individual is uncomfort-able with that, the suit is not perceived as a luxury in that context, whereas in the context of the day job it is perceived as a luxury. Thus one product may be perceived in multiple ways. According to situational context, one motive is likely to be dominant over the others (Vigneron and Johnson 1999). Even if a luxury product possesses more qualities than one, for example when it can be successfully used for diff erentiation, but also for physical pleasure, one is pre-sumably dominant in the initial consumption of the product. The emphasis of the traditional perspective of luxury may lie with diff erentiation motives, whereas the emphasis of the new perspective of luxury may lie with personal motives. This may show the diffi culty and implications of use of luxury by consumers.

Two implications innate with luxury can be identifi ed based on the motives of the traditional perspective of luxury and the new perspective of luxury. The fi rst one is about letting the outside know who you are through individuality or group membership. With these values others are involved. It is about send-ing messages about you to others. Because perception of others is involved, the consumers’ motivations are dependent on the consumption of others (Vigneron and Johnson 1999). The second is about self-actualisation and per-sonal enrichment. Carcano and Catalani (2005) defi ne these two respectively as hetero-referential use and self-referential use. Vigneron and Johnson (1999) talk about interpersonal and personal eff ects. In this thesis the latter two no-tions are used from now on. Both infl uence the behaviour of the consumer.

The main diff erences between the motives as a function of self-consciousness and price-as-prestige beliefs are illustrated in fi gure 4.12. The model clearly

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depicts that the personal eff ects, hedonist motivation for luxury consump-tion, are less dependent on price and more related to private purposes. This corresponds with the democratic attitude toward luxury where price is less important. People that consume luxury with an emphasis on hedonist pur-poses may do this for personal development in line with their values. Personal values are directed more inward and are about self-actualisation and personal satisfaction. In opposition to interpersonal values they are not related to the consumption of others (Vigneron and Johnson 1999).

Based on the research by Vigneron and Johnson (1999) and previously discussed literature, a framework of luxury consumption motives is suggested (see fi gure 4.13) that addresses both the interpersonal and personal dimension. The fi rst dimension may be seen as the semiotic dimension of luxury and is manifested through the interpersonal eff ects. The interpersonal eff ects of luxury consumption may be split into three diff erent motives, that is, osten-tation, distinction and membership. The second dimension addresses the personal eff ects of luxury consumption and may be divided into self-actualisa-tion and personal pleasure as its two motives.

Figure 4.13 Framework of motives

ConspicuousUniqueSocial Emotional

OstentationDistinctionMembershipSelf-actualisationPersonal pleasure

Perceived value Motive

Motives for luxury consumption

Source: Based on a framework from Vigneron and Johnson 1999, adjusted by the author

Interpersonal dimension

Personal dimension

Elitist attitude

Democratic attitude

Hedonist

Bandwagon

Snob

Veblenian

Source: Framework from Vigneron and Johnson 1999, adjusted by the author

Type of consumer

Importance of the perception of price as an indicator of prestige

Self

-co

nsci

ous

ness

lower higher

pu

blic

pri

vate

Figure 4.12 Differences in type of consumers


This framework may give insight in what drives consumers to buy and use luxury products. It addresses and makes a distinction between both personal and interpersonal factors that infl uence luxury consumption. Although all aspects mentioned in the framework may be infl uential in consuming luxury, usually one aspect will be prominently dominant as highlighted earlier. Despite this, luxury products may be used for other reasons as well after the initial motive for consuming luxury has been fulfi lled. The framework may be used as a starting point to position or build luxury brands for marketers and to help researchers understand the consumers’ behaviour regarding luxury brands as well as researching which behaviour is more present in diff erent luxury segments (Vigneron and Johnson 1999) and within diff erent types of luxury. The framework is suitable to be used in diff erent contexts of luxury consumption and withstands the relative character of luxury.

By incorporating both personal and interpersonal eff ects and taking into consideration that one aspect will be dominant during consumption, together with the diff erent attitudes toward luxury, it is possible to identify multiple scenarios in diff erent contexts. The personal eff ects have become stronger in contemporary consumption societies as described earlier. Thus the emphasis of luxury consumption may have shifted for several consumers in advanced industrialised societies to addressing the personal factors fi rst. Self-actualisa-tion has become increasingly important and may be stronger in the consump-tion of products perceived as luxurious. Together with the purpose of con-sumption for forming self-identity, the emerged democratic attitude toward luxury and several society changes, new markets may have emerged. These markets may focus on the self-actualisation of consumers through creating the highest levels of appreciation with their products in communities of interest. Innocent Drinks is a company that successfully addresses one of these markets (see chapter 5: Manifestation in Society).

4.6 Luxury Consumption in Contemporary Society

The traditional view and use of luxury was pointed toward status and distinc-tion for high social classes. This way of thinking and the motivation behind it is still apparent in today’s societies, even though new ways of thinking concerning luxury have risen in societies that were prosperous and developed postmodern values. Consumer perceptions of luxury diff er widely today according to knowledge and context. The shift to postmodern values in advanced industrialised societies as well as other changes mentioned earlier changed the general view of luxury. Rising affl uence and availability of prod-ucts also contributed to a diff erent perception of luxury. Industrialisation, the opening up of the market due to globalisation, the response of luxury retailers as well as other companies, new marketing practices, heightening infl uence of women, changing gender roles, changing perception of social classes, height-

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ening interest in experiences, increasing use of symbolism, all added to the development and current views on luxury. The concept of luxury has been infl uenced by multiple factors and is the result of still developing multiple processes that make it diffi cult to defi ne luxury in an unambiguous way. Nev-ertheless the changed view of luxury has been addressed from diff erent angles by trend watchers, scholars and institutions. Although many focus primarily on affl uent people in society, they still demonstrate an altered perception of luxury and are therefore relevant.

Clearly a new perception of luxury may not be focused on distinction pur-poses anymore, but on individual well-being. Price may be increasingly less important for a good to be considered a luxury, which is demonstrated in an extreme way with the emerged democratic attitude toward luxury. However, the status conveying purpose of luxury has not disappeared in contemporary societies. These two views may coexist and may be used by the same person in diff erent situations. People tend to distinguish themselves from others and traditionally luxury products have been used for that. With the shift in values due to changes in society, luxury may be increasingly used for personal development. Pleasure has always been an important factor in luxury con-sumption; nevertheless the main purpose was to distinguish oneself for status purposes. Change in values resulting in a democratic view on luxury may have caused the emphasis to shift from status conveying purposes to pleasure. Postmodern values focus on well-being and self-expression, therefore the no-tions of pleasure and quality changed accordingly. The change of quality can be seen in the socio-cultural model of consumption addressed earlier. Plea-sure is likely to shift to self-actualisation and other forms of pleasure instead of solely the comfort and indulgence that were traditionally associated with luxury.

Apart from changes in manifestation related to values and attitudes, luxury may be divided into two parts. The fi rst part is luxury that is used for distinc-tion or membership purposes and the second part is luxury that is used to enrich oneself through for example indulgence or self-development. These have been respectively addressed as the traditional perspective of luxury and the new perspective of luxury.

Considering the fl uid borders of social class, the trading up phenomenon, the two practically opposing attitudes toward luxury, tacit knowledge infl u-ence in luxury and the diff erent motives of luxury consumption in contempo-rary society, luxury will manifest itself diff erently according to the situation and interest of the consumer.

5Manifestation in Society

This chapter addresses two market segments associated with luxury. Additionally, two conducted case studies illustrate and clarify the previously discussed theory citing practical insights.

Chapter fi ve Manifestation in Society

5.1 Market Segments Associated with Luxury

5 1 1 The Economic Luxury Sector

Earlier the economic luxury sector was addressed. This economic luxury sector can be seen as a market segment and is heavily protected to remain exclusive (Mortelmans 2005). One of the measures to protect its exclusivity is The Comité Colbert (www.comitecolbert.com), which is an organization that represents a large part of the companies belonging to the luxury sector. This sector signifi cantly infl uenced the ideas people have about luxury due to branding the concept of luxury to their ideal (Mortelmans 2005). Several ideas framed by the luxury sector are still apparent in consumers’ ideas about luxury. Among those are the luxury patterns expensiveness and high quality. A luxury brand is often related to this product segment and may be interest-ing for particular communities that are extremely wealthy. The products are often very expensive and scarce. Nevertheless these brands use several strate-gies to make their brand available for less wealthy consumers by making less expensive branded products (Carcano and Catalani 2005). For example Bul-gari jewellery can be worth over 4 million dollars, while on the other hand branded Bulgari sunglasses can be purchased for less than 250 dollars. The ac-quired heritage and image of the company is maintained through producing the expensive traditionally produced products, whereas the cheaper branded products’ purpose is to generate turnover and brand awareness (Carcano and Catalani 2005). However, the common branded products bear the name of the luxury company and imply quality and exclusivity through the brand. The brand could therefore create extra value for the consumer. The dominating motives of consuming these brands are assumed to be ostentation and distinc-tion, which is based on the original use of these products that often have a long history related to the extremely affl uent in society.

Research related to luxury brands is widely available. A study by De Barnier

5 Manifestation in Society

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et al (2006) identifi ed facets of luxury considered important among luxury brand consumers in Russia, France and the UK (see fi gure 5.1). These facets may be seen as the most important luxury patterns of this segment. These patterns are aesthetics, personal history, premium quality, expensiveness, self-pleasure, aspiration, conspicuousness, functionality, luxury atmospherics and uniqueness.

Because the interviews were conducted in diff erent countries, not all of these luxury patterns were seen as important or necessary in every country. The out-come of the study can be seen in fi gure 5.1 . Though all of the luxury patterns may be relevant for consumers and may exist in their perception of a luxury brand, the study suggests that the general perception of luxury brands diff ers among countries. For example the study pointed out that in the UK the lux-ury atmospherics could be of importance, whereas in France and Russia this facet may not be perceived as important. According to consumers of the UK a non luxury product could become a luxury product if the right atmosphere is created through for example shopping experience and high service levels (De Barnier et al 2006). One may suggest that because of the long history of France with the luxury sector (De Barnier et al 2006), the luxury patterns aes-thetics, personal history and premium quality are of greater importance than the others in a luxury brand.

Though the study focused on consumption of luxury brands of the luxury sector and not on consumption of luxury as a social phenomenon, it still demonstrates the implications and diff erences around the concept of luxury among cultures and what stimulates people to consume luxury products. It also suggests that luxury patterns change over time, since the study was based

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Figure 5.1 Important luxury facets in three countries


on another study by Dubois et al (2001). They identifi ed six main facets of luxury, while this study identifi ed ten among three countries. The pattern su-perfl uousness identifi ed by Dubois et al was not seen as important among the interviewees of the study of De Barnier et al. Superfl uousness may therefore not be an important luxury pattern of luxury brands anymore among luxury brand consumers in the countries studied.

According to the dynamic approach of the theory of Reinmoeller (2002) mentioned earlier, emerging luxury in small communities of interest may emerge from these luxury patterns. Together with new, mainly tacit knowl-edge and new contexts, new luxury may appear resulting in luxury brands and eventually new luxury patterns. The study by De Barnier et al (2006) may have identifi ed new luxury patterns for luxury brands in comparison to the study from Dubois et al (2001).

5 1 2 The New Luxury Market

The phenomenon trading up described earlier makes both perspectives of luxury more accessible for consumers in advanced industrialised societies. Consumers are likely to spend considerably more money on things they consider important. Those may correspond with their lifestyle through which they create self-identity. Advanced industrialised societies have a population where the diff erences between incomes have become smaller. The middle class of these societies have become more affl uent and represent a large part of the population. Together with the increasing importance of experience, this has resulted in a new market that has responded to these changes by creat-ing ‘masstige’ (mass-prestige) products and was described as the new luxury by Silverstein and Fiske (2004). Masstige products are premium products that are placed between common and luxury brand products. They often off er emotional engagement, technical diff erences and superior functionality (Silverstein and Fiske 2005: 6). These products can have characteristics of both perspectives of luxury and may be used accordingly. However, most of them may be used for self-actualisation corresponding to the democratic attitude toward luxury. They are attainable for most consumers due to rocketing and trading up. In addition they support establishing or maintaining an identity through intangible value for a relatively high price. Therefore, marketing-wise, this is assumably the most interesting segment in contemporary society. An extensive study and related trends concerning the new luxury market is available in the book Trading Up: Why Consumers Want New Luxury Goods--And How Companies Create Them by Silverstein and Fiske (2005).

Universal luxury patterns related to the new luxury market are diffi cult to identify, because new luxury products may be found in all product categories. Nevertheless the notion authenticity may be an increasingly important facet in the consumption of these products (Lewis and Bridger 2001: 6, Silverstein

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and Fiske 2004, Carbonaro and Votava 2005, Gilmore and Pine II 2007: 1).

5.2 Luxury Goods within Communities: Two Case Studies

5 2 1 From Status Symbol to Commodity: case: Motorola RAZR V3

This case study gives an example of a product consumed with the dominat-ing motive of distinction. Therefore it belongs to the traditional perspective of luxury. It revolves around the Motorola RAZR V3 (RAZR) mobile phone. The community where the RAZR was perceived as a luxury and used for distinction, was the community of creative and tech savvy people interested in design and technology. The product was perceived as a luxury to convey status within the community at its release in the summer of 2004. A newly released product may be perceived as luxurious because of the yet to discover technology and functionality and often off er social distinction (Carcano and Catalani 2005). The case also gives possible reasons for the quick downfall of the luxury status of the RAZR. In addition a special version of the RAZR, the Motorola RAZR V3i Dolce & Gabbana Limited Edition, is looked into to investigate the infl uence of a luxury brand on a commodity.

From Status Symbol to Commodity Case: Motorola RAZR V3

The Motorola RAZR V3 as a status symbolThe Motorola RAZR V3 (RAZR) (see fi gure 5.2) was de-

signed for the purpose of enhancing Motorola’s image, which had been suffering from heavy competition from Nokia, as a technologically advanced and innovative brand. Therefore the RAZR was designed to be the slim-mest phone on the market. It had to be unique among all other mobile phones at the time of its release and had to have jewellery like characteristics. Several unique and technologically advanced characteristics (see fi gure 5.3) were developed and designed for the RAZR. The phone was to be commercialised for a niche market to revive the Motorola brand, rather than for increasing turnover (Lashinsky 2006). The unique features caused the RAZR to become highly respected and adopted among tech savvy and creative people. It was regarded as a luxury, a status symbol to support the consumption for distinc-tion within that community to express their particular interest in design and technology (Stone 2007). The ex-pression of status within the community was supported by several luxury patterns of the product. At the release of the RAZR, the price was relatively high in comparison

Figure 5.2: Motorola RAZR V3 mobile phone


with other mobile phones. Expensiveness was defi nitely a luxury pattern in the beginning. Together with its aes-thetics, advanced technology, functionality, uniqueness and initial scarcity, the RAZR got signifi cant attention and admiration in its environment. This resulted in the desired effect of status and uniqueness in the commu-nity of interest.

The accelerated trickle-down effectProducts related to technology are often heavily reli-

ant on the trickle-down effect due to the fast develop-ment of technology. If the technology becomes old due to improved newer technology, products drop in price and become increasingly available. When the technol-

ogy of the RAZR developed by Motorola became more available, the RAZR lost its initial appeal among the community to other mobile phones with newer features and aesthetics.

Decisions made by Motorola concerning the RAZR as-sumably accelerated the trickle-down effect of the RAZR and the loss of its status as a luxury among the tech savvy and creative people. With the decision to drop the price of the RAZR supported by a downgrade of packaging illustrated in fi gure 5.4 (Motorola 2005), the mobile phone became less exclusive due to increasing purchase of the RAZR. In the past four years the price has dropped from €600,- to €100,- (see fi gure 5.5). The

Figure 5.4: RAZR packaging

Top tierSide keys are on the top half of the phone instead of in their normal place, down below. Researchers said consum-ers would object. They haven’t.Tough callThe caller-ID panel is thinner and stronger, using pricey glass, not plastic.Under the skinTo maximize strength while minimizing weight, the team used magnesium for the housings inside the phone.Plugged inMost Motorola phones have three “connectors,” for power, data, and earphones. The RAZR has one mini USB side port that does triple duty.Smooth fi nishThe exterior of the phone is anodized aluminium, a super-strong metal that looks way snazzier than plastic.Bright ideaMoto turned to a Korean specialist fi rm to craft the super-thin metal keypad. Electroluminescent backlighting added extra cool.Side-by-sideRAZR’s battery is next to the circuit board, not beneath it, to aid thinness. It also makes the RAZR wider than standard.Big footInstead of being at the top, the antenna hides in the mouthpiece at the bottom. An engineering challenge, it delivers a sleeker look.

RAZR’s unique features

Figure 5.3 (source: Stone 2007)

Figure 5.5: Price drop of the RAZR (Source: http://www.vergelijken.nl/item/19859/pricehistory (18-01-2008))

7170

switch to conventional packaging made the phone less expensive for consumers, but assumably also infl uenced the perception of the special unique character of the RAZR.

Failing to launch a successful successorThe image Motorola had carefully created with the

RAZR, was lost again after the company was not able to create a true successor of the RAZR showing its in-novative character (Stone 2007). The initial successor was remarkably similar to the original RAZR apart from some technical improvements (see fi gure 5.6). Also new high-end Motorola mobile phones could not imply in-novation, because they stayed to close to the concept of the RAZR and suggested yesterday’s technology and style (Stone 2007).

Instead of creating a platform of innovation on the success of the RAZR, Motorola chose to make the RAZR readily available for everyone. The RAZR series as well as other successors were not able to convince the ini-tially intrigued community of interest that Motorola was a highly innovative company. Though the RAZR was a huge success in the mobile phone market segment, the perception of a status symbol within the initial commu-nity of interest was lost and was not able to be regained by a new mobile phone from Motorola. Other compa-nies did launch mobile phones that were appealing to creative and tech savvy people and assumably took over the image of highly innovative and technologically ad-vanced companies (Stone 2007).

Added luxury value through a brand: Motorola RAZR V3i Dolce & Gabbana Limited Edition

In December 2005 Motorola and Dolce & Gabbana, a high end fashion house, announced a collaboration in the form of a limited edition based on the RAZR V3i (see fi gure 5.7).

The RAZR V3i was customised by the designer duo Dolce & Gabbana. The housing was given a liquid gold fi nish as its main feature. Besides this some internal software customisation had been done in the form of

Figure 5.6: RAZR V3 vs RAZR V3i

Figure 5.7: Motorola RAZR V3i D&G Limited Edition


wallpapers, customised sounds and a video clip about the 20-year history of the designer duo. Also special packaging was designed to convey the impression of something special (see fi gure 5.8). The Motorola RAZR V3i Dolce & Gabbana Limited Edition became available in an edition of 1000 from which 100 units were re-served for promotional purposes. The other 900 units were exclusively sold through Dolce & Gabbana bou-

tiques in Italy, Spain, UK, France and Germany.The cooperation proved to be a success, because the

phones sold out immediately despite the high price of more than 2000 euros. The limited edition assumably was successful because of the association with Dolce & Gabbana, who are renowned high-end luxury fashion designers known for their sense of style and attitude. The name Dolce & Gabbana, together with a limited edition of only 1000 units and the high price, made the RAZR V3i Dolce & Gabbana a desired object among consumers active in the luxury sector. Because of the limited amount of phones especially designed and tar-geted at the high end of the market, this phone was an opportunity to attain a mobile phone that was available only for a few. The motives of the consumer to buy this mobile phone may have been related to conspicuous-ness or uniqueness factors. The phone is similar to the normal RAZR V3i, apart from the gold liquid fi nish and some software modifi cations. However, the high price, limited edition and the sign-value the brand Dolce & Gabbana created, made this mobile phone worth the price within the community of interest.

Clearly the brand Dolce & Gabbana, together with the scarcity aspect and price, proved to be suffi cient to up-grade the Motorola RAZR V3i from a commodity mobile phone to a phone perceived as exclusive among luxury brand consumers.

5 2 2 A European New Luxury Example: case: Innocent Drinks

This case study gives an example of a product related to the new luxury market. The products of Innocent Drinks are arguably especially consumed for their healthy character and Innocent’s responsible way of doing business among consumers belonging to the Lifestyles of Health and Sustainability (LOHAS) (www.lohas.com). The LOHAS signifi cantly value health, social justice, personal development and sustainability. The consumption of drinks made by Innocent Drinks among members of the LOHAS may be considered to have a dominant motive of self-actualisation supporting their beliefs and personal values. The case is therefore an example of manifestation of the new perspective of luxury. In addition the notion authenticity is highlighted due to its increasing importance in luxury consumption for consumers.

Figure 5.8: Customised packaging

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A European New Luxury Example Case: Innocent Drinks

The Company Innocent DrinksInnocent Drinks is a company founded in the UK in

1998. They produce smoothies (see fi gure 5.9), which are drinks made out of crushed and squeezed fruit. Currently they are active in the UK, France, the Nether-lands, Denmark, Germany, Sweden and Belgium. More background information can be found on their website (www.innocentdrinks.co.uk).

Innocent Drinks as a New Luxury ProductThe brand Innocent is an example of a product belong-

ing to the new luxury market. Following the framework developed by Silverstein and Fiske, Innocent Drinks falls into one of the ‘Three New Forms of Luxury’, that is, the accessible superpremium category (http://www.bcg.com/impact_expertise/publications/Book_Trading_Up.html). Innocent is one of the most expensive drinks in its category, the smoothie market, which is already a premium division of the fruit drink market. Yet it is affordable to the middle-market consumer, despite the high price in its category. Figure 5.10 shows that the brand Innocent has the characteristics of a new luxury good defi ned by Silverstein and Fiske (2005: 56).

Besides this, the company has been highly innovative within the smoothie market. They started by convincing people that there was a market for super fresh smooth-ies with limited shelf life. Innocent smoothies did not compromise with the initial idea. An Innocent smoothie

had to consist of 100% natural ingredients and could not be made out of juice concentrate. It had to be 100% good for you, like fruit. Several new smoothie

fl avours and drinks have been developed throughout Innocent Drinks’ existence. Next to the product itself, the packaging has been under development from the beginning. The most recent innovations are the 100% recycled, lighter bottle (http://www.innocentdrinks.

Figure 5.9: Innocent Drinks smoothie

Figure 5.10: Innocent and new luxury

EngagingAffordable

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Innocent is emotionally appealing as a brand due to its human touch and lived by values.Innocent drinks can be purchased in selected supermarkets, small convenience stores or cafeterias.Innocent drinks are more expensive than other fruit drinks and compete in the highest division of fruit drinks, the smoothies segment.The highest possible quality of fruit is sought after. No additives are added to their drinks. The only drink that is similar to an Innocent smoothie is a freshly made smoothie.Innocent Drinks has a strong set of core values that are never forgotten. Values are lived by in activities organised around and within the company. Customers identify with those values and support them.

New luxury Innocent Drinks

New luxury characteristics: Innocent and new luxury


co.uk/us/ethics/sustainable_packaging/PCR_bottle/) and a failed trial of an eco-bottle made out of 100% renewable sources (http://innocentdrinks.typepad.com/innocent_drinks/2007/10/a-bit-about-our.html).

Also the way of doing business is constantly under development. Innovation is a key element in keeping a company on the foreground of the new luxury market. Innovation is a key element in remaining a ‘New Luxury Leader’ (http://www.bcg.com/impact_expertise/publi-cations/Book_Trading_Up.html)

Innocent Drinks and the LOHASThe initial target group of Innocent Drinks was young

urban professionals, similar to the founders themselves. Because it is diffi cult to do something healthy in urban city life, Innocent Drinks tried to make a small difference by making fruit more practically available. Today the company has expanded the target group by addressing kids and people that identify with the brand values of the company. Because of their business approach and activities, the Innocent Brand corresponds well with the Lifestyles of Health and Sustainability (LOHAS). These consumers value health and fi tness, personal develop-ment, social responsibility and sustainability (www.lo-has.com).

Innocent Drinks as a brand provides the LOHAS an emotionally perceived value by communicating and sharing similar values. The motive for self-actualisation through the consumption of luxury may be apparent in the consumption of Innocent Drinks among the LOHAS. Through the consumption of Innocent Drinks LOHAS members create or sustain their self-identity through consuming what they think is important. Similar val-ues are communicated and valued by Innocent Drinks, which can be seen in the ethics of the company (see fi gure 5.11).

The premium price of smoothies of Innocent Drinks in comparison with similar beverages is paid by LOHAS members because of the sign-value the company cre-ates for its products through branding and its activities. Consuming the brand Innocent Drinks for LOHAS mem-bers fi ts into the new perspective of luxury to support self-actualisation. Besides premium quality, other val-ues, which create emotional benefi ts for the LOHAS, are considered important and communicated by Innocent Drinks.

Communication and AuthenticityAuthenticity for Innocent Drinks is created through the

transparent communication of activities and brand val-ues. Innocent Drinks’ design platform (see appendix A for Innocent’s product portfolio and an extensive anal-ysis chart of the packaging) communicates the values transparency, responsibility, easy-goingness and qual-ity. This is supported by the technology platform that looks into more sustainable solutions for packaging. The product that it is all about is made of 100% natural ingredients and is good for your health; everything is done to deliver this message in the best possible way. Besides the design platform of the product portfolio, other measures are taken to make sure the values of the company are refl ected. The brand values are shown through business activities, communication and organ-ised events. Several examples of those have been col-lected in a table (see fi gure 5.12). The table provides a good overview of practices within the company that provides one clear image of the brand. Everything from ingredients to customer service to ethics is perfectly in line with the core values of the brand Innocent. All ac-tivities correspond with their brand values, giving them credibility and trustworthiness with the consumers and therefore creating authenticity.

Figure 5.11: Innocent and ethics (source: http://www.innocentdrinks.co.uk/us/ethics/)

Keeping things naturalResponsible ingredients

Sustainable packagingResource-effi cient businessSharing the profi ts

Innocent Drinks uses 100% natural ingredients that are good for people.Innocent Drinks uses ingredients that are grown or produced in a sound working envi-ronment and with biodiversity in mind. Farms that are certifi ed by environmental and social organisations, such as the Rainforest Alliance, are favoured.Packaging that has the least impact on the environment is used.The fi rst aim is the reduction of the total carbon footprint of Innocent Drinks.10% of the profi t goes to charity.

Innocent and ethics: Procurement of ethics

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Figure 5.12: Innocent Drinks business activities

6Conclusions and Refl ections

The concluding chapter summarises the study and discusses the potential for future investigation.

Chapter six Conclusions and Refl ections

6.1 Conclusions

The research question: ‘What consumer motives are of signifi cant infl uence considering contemporary perspectives of luxury consumption?’ addressed in the fi rst chapter was attempted to be answered with the study undertaken. Therefore, the notion of luxury was summarised and clarifi ed. Relative to a number of studies on and perspectives of luxury, a framework to capture the essence of a luxury product was created in order to frame the consumer motivation. Two perspectives of luxury were then identifi ed based on research related to traditional views of luxury and recent societal changes which may have infl uenced these perspectives. Finally these perspectives were translated into motives for luxury consumption. The fi nal outcome is multidisciplinary in nature and intent and may hopefully be useful for the development and utilisation of ideas and further elaboration within fi elds of design, marketing and social sciences.

Luxury proved to be a diffi cult and complex concept to concretise, espe-cially when the relative character is recognised. Luxury may manifest itself diff erently according to context and knowledge within a community of interest. General luxury patterns may be of infl uence in the highest levels of appreciation toward products and may therefore be diff erent amongst vari-ous communities. The undeniably relative aspect of luxury asks for diff erent approaches to address relevant luxury patterns for targeted consumers. In order to make the extensive nature of the concept of luxury visible, a frame-work was created to illustrate the conceptualisation of luxury product. The characteristics of a luxury product may comply with universal requirements that were distilled into one framework. The universal requirements are based on a number of extensive studies related to the concept of luxury. The frame-work aims to provide a holistic view of what constitutes luxury and luxury products. The framework itself may be extended according to the particular interests of consumers to defi ne better the notion of a luxury product within

6 Conclusions and Refl ections

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specifi c communities.Altogether two main perspectives of luxury were identifi ed that have diff er-

ent motives and drivers for luxury consumption. On the one hand there is the traditional perspective of luxury as a communicative means and on the other hand there is the new perspective of luxury as a personal means. These notions may exist next to each other and may manifest themselves diff er-ently according to the goal of the consumer based on context and knowledge within communities.

Several previously addressed changes in society, for example the change in perception of quality, but also changed strategies of the economic luxury sector, caused luxury to be perceived diff erently and this may have resulted in the new perspective of luxury. Consumption practices have always been pres-ent in these developments that aff ected luxury. This led to diff erent attitudes toward luxury of consumers, leading to new possibilities, but also require-ments for the marketplace. The study of Dubois et al (2005) identifi ed at-titudes today and gave an overview of the general attitude in several European countries. Next to the elitist attitude toward luxury, a democratic attitude was seen. The democratic attitude toward luxury clearly demonstrated a change that took place in the perception of luxury, because beliefs concerning luxury were mentioned that were not seen before. The belief that luxury should be available for everyone and does not have to be necessarily expensive is one of those. When the emphasis of consuming luxury is on stratifi cation pur-poses, whether vertical or horizontal, these beliefs do not comply. Diff erent perceptions of luxury may depict a shift toward an emphasis on a personal dimension of luxury where diff erentiation is seen as less important. The shift toward the personal dimension may be explained with the shift toward values concerning well-being and self-expression in advanced industrialised societies. In these societies creating economic gains is replaced by pursuing well-being and a high quality lifestyle. These changes may have created a new perspective of luxury in addition to the traditional perspective. The new perspective of luxury may be a result of multiple processes that occurred in society.

The tendency is that luxury may be used signifi cantly more for self-actu-alisation in contemporary society. The democratic attitude towards luxury supports this new direction, making luxury for self-actualisation considerably more signifi cant as a primary purpose. Because class diff erences are minimal in contemporary society, lifestyle is getting more important. People may consume luxury to refl ect their values, which is supported by their lifestyle in contemporary society. Luxury consumption may thus refl ect values that are highly important to people, which may be moving increasingly in the direc-tion of personal development in contemporary society.

An attempt to narrow down the reasoning behind luxury consumption today was done by the development of a framework of motives for luxury

Chapter six Conclusions and Refl ections

consumption. The framework considers fi ve main motives for luxury con-sumption based on a framework developed by Vigneron and Johnson (1999) and new insights from other studies. This framework may be helpful in deter-mining a dominating motive in the consumption of various luxury products and services.

6.2 Possible Future Directions

The wide scope of the study may give possibilities for further development in relation to the theory. The framework of motives for luxury consumption is mostly based on theory set in a Western context. With the increasing impor-tance of consumption in other countries outside the Western societies, points of view from these societies may be investigated to establish a better under-standing of luxury consumption in those countries. One of the theories is that developing consumption societies start with conspicuous consumption, supporting the values corresponding with economic gains. They may develop similarly to Western countries. However, because of the rapid development of consumption practices and diff erent cultural backgrounds in countries like Russia and China, these countries may develop diff erently and establish new perceptions and attitudes toward luxury. The study focused mostly on possible change in luxury consumption. How-ever with addressing luxury as a social phenomenon, the interpersonal eff ects of luxury consumption are not only present in affl uent layers of society. Research related to luxury consumption mostly focused on affl uent layers of society or on the luxury sector. Research addressing the interpersonal eff ects in other layers of society may help to increase clarifi cation of luxury as a social phenomenon. Possible outcomes may also help to create awareness of possible integration of multiple meanings in products and stimulate develop-ment of methods to accomplish this successfully.

With, for example, the emergence of a democratic attitude toward luxury and the shift toward values concerning well-being, in many cases the empha-sis of luxury consumption has shifted to personal motives for luxury con-sumption. Nevertheless other motives may be apparent as well. The consump-tion of an Aston Martin may be done in the fi rst place to express ostentation, however this does not mean that extensive personal pleasure is not another motive. The interaction between the diff erent motives of luxury consump-tion and especially between the personal and interpersonal eff ects may be a fascinating topic that may show links between the motives and may clarify processes within luxury consumption.

Other possible research directions that may be interesting are the cultural diff erences within Europe and how these aff ect, for example, the attitudes and perceptions of luxury. To further build on and develop this study a specifi c community of interest could be chosen and analysed to identify context

8180

related attitudes and motives and specifi c luxury patterns for that community of interest. From an industrial design point of view it would be interesting to link product development theories to outcomes in order to concretise identi-fi ed luxury patterns for products.

Value theories are interesting to link to this study because of an addressed change in luxury consumption that may have been caused by the shift to-wards postmodern values in advanced industrialised societies. Values or mo-tivational domains could, for example, be associated with motives of luxury consumption.

6.3 Refl ections regarding the Study

The study proved to be diffi cult due to the indefi nable character of luxury. Considerable amount of time was spent on interpreting the concept of lux-ury. Nevertheless it helped to frame current ideas about luxury and separate more traditional and new views concerning luxury.

From the beginning an emphasis on luxury outside the equally named product segment was strived for in order to place recent developments within or related to luxury, for example the new luxury market and the experience economy. Due to this, the study remained of a wide scope and it was diffi cult to frame it thoroughly with concrete examples. The case studies undertaken could have been more extensive. In addition extra case studies could have clar-ifi ed and illustrated more narrowed down trends related to the perspectives of luxury as well as the interaction between the two perspectives. Unfortunately this was outside the time scope of this study.

Furthermore it would have been exciting to connect the outcome of the study to a more defi ned industrial design perspective. The initial plan in-cluded a design project based on the outcomes of the study, but because of previously stated reasons, that project proved to be outside the scope of this study. Optimistically speaking, projects related to this study will be carried out in the future.

References

Books

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Bocock, R. (1993) Key Ideas: Consumption, London: Routledge

Danziger, P.N. (2005) Let Them Eat Cake: Marketing Luxury to the Masses - as Well as the Classes, Chicago: Dearborn Trade Publishing

Gilmore, J.H., Pine II, B.J. (2007) Authenticity: What Consumers Really Want, Boston: Harvard Business School Publishing

Inglehart, R. (1997) Modernization and Postmodernization: Cultural, Economic, and Political Change in 43 Societies, Princeton: Princeton University Press

Lewis, L., Bridger, D. (2001) The Soul of the New Consumer: Authenticity – What We Buy and Why in the New Economy, London: Nicholas Brealey Pub-lishing

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Beyond Usability pp.125–134, London: Taylor & Francis CRC Press

Silverstein, M., Fiske, N. (2005) Trading Up: Why Consumers Want New Luxury Goods... And How Companies Create Them, New York: Portfolio

Veblen, T. (1991) The Theory of the Leisure Class, New Brunswick: Transaction Publishers

Yu, L., Chan, C., Ireland, C. (2006) China’s New Culture of Cool: Understanding the World’s Fastest-growing Market, Berkeley: New Riders Publishing

Journal Articles

Carbonaro, S., Votava, C. (2005) ‘Paths to a New Prosperity’, The Nordic Tex-tile Journal, 2005 pp.71–85

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Dubois, B., Czellar, S., Laurent, G. (2005) ‘Consumer Segments Based on Atti-tudes Toward Luxury: Empirical Evidence from Twenty Countries’, Marketing Letters, 16 (no.2 April 2005) pp.115–128

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Inglehart, R. (2000) ‘Globalisation and Postmodern Values’, The Washington Quarterly, 23 (no.1 winter 2000) pp.215–228, online at http://muse.jhu.edu/demo/washington_quarterly/v023/23.1inglehart.html

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Shovlin, J. (2000) ‘The cultural Politics of Luxury in Eighteenth-Century France’, French Historical Studies, 23 (no.4 fall 2000) pp.577–606

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Vigneron, F., Johnson, L.W. (1999) ‘A Review and a Conceptual Framework of Prestige-Seeking Consumer Behavior’, Academy of Marketing Science Review, 3 (no.1), online at http://www.amsreview.org/articles/vigneron01-1999.pdf

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Yeoman, I., McMahon-Beattie, U. (2005) ‘Luxury markets and premium pric-ing’ Journal of Revenue and Pricing Management, 4 (no.4) pp.319–328

Research Papers

Cautela, C., Sammicheli., M., Zurlo, F. (2007) ‘New Luxury Landscapes: Trajectories, Clusters and Design Directions’, paper presented at The Confer-ence Designing Pleasurable Products and Interfaces, University of Art and Design Helsinki, Helsinki, Finland, 22–25 August 2007

De Barnier, V., Rodina, I., Valette-Florence, P. (2006) ‘Which Luxury Percep-tions Aff ect Most Consumer Purchase Behavior?: A Cross Cultural Explor-atory Study in France, the United Kingdom and Russia’, paper presented at The International Congress ‘Marketing Trends’, Università Ca’ Foscari Venezia, Venice, Italy, 20–21 January 2006, online at http://www.escp-eap.net/confer-ences/marketing/2006_cp/Materiali/Paper/Fr/DeBarnier_Rodina_ValetteFlor-ence.pdf

Dubois, B., Czellar, S. (2002) ‘Prestige Brands or Luxury Brands? An Explor-atory Inquiry on Consumer Perceptions’ paper presented at The European Marketing Academy 31st Annual Conference, University of Minho, Braga, Portu-gal, 28–31 May 2002, online at http://www.hec.unige.ch/recherches_publica-tions/cahiers/2002/2002.06.pdf

Dubois, B., Laurent, G., Czellar, S. (2001) ‘Consumer Rapport to Luxury: Analyzing Complex and Ambivalent Attitudes’, Les Cahiers de Recherche, 736, online at http://www.hec.fr/hec/fr/professeurs_recherche/upload/cahiers/CR736.pdf

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Magazine Articles

Jurik, M. (2006) ‘Der Neue Luxus’, Cash, (no.4 2005) pp.122–124, online at http://www.zukunftsinstitut.de/downloads/rez_pm_Cash0406.pdf (01-07-2007)

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List of Figures

Chapter one: Introduction

Figure 1.1 Groupings made with the affi nity diagram method

Chapter two: Luxury and History

Figure 2.1 Etymology of luxury

Chapter three: Theoretical Framework of Luxury Products

Figure 3.1 Changing society structureFigure 3.2 Types of luxuryFigure 3.3 Emergence process of luxuryFigure 3.4 Universal factors of a luxury product

Chapter four: Perspectives of Luxury

Figure 4.1 Luxury descriptors and clustersFigure 4.2 Positioning chart of countries relative to attitudesFigure 4.3 Positioning chart of countries relative to attitudesFigure 4.4 From economic gains to lifestyleFigure 4.5 Materialist and post-materialist values relative to ageFigure 4.6 Position of countries relative to valuesFigure 4.7 New consumers vs old consumersFigure 4.8 Trading up for the marketplaceFigure 4.9 A shift in quality categoriesFigure 4.10 Socio-cultural model of consumptionFigure 4.11 Trading up and trading down supplement each otherFigure 4.12 Diff erences in type of consumersFigure 4.13 Framework of motives

Chapter fi ve: Manifestation in Society

Figure 5.1 Important luxury facets in three countriesFigure 5.2 Motorola RAZR V3 mobile phoneFigure 5.3 RAZR’s unique featuresFigure 5.4 RAZR packaging

8786

Figure 5.5 Price drop of the RAZR Figure 5.6 RAZR V3 vs RAZR V3iFigure 5.7 Motorola RAZR V3i D&G Limited EditionFigure 5.8 Customised packagingFigure 5.9 Innocent Drinks smoothieFigure 5.10 Innocent and new luxuryFigure 5.11 Innocent and ethicsFigure 5.12 Innocent Drinks business activities

Appendices

Appendix A

Analysis Innocent Drinks Product Portfolio and Packaging

8988

vignette prominently in the middle; colour corresponds with taste

Innocent Packaging Lay Out and Characteristics

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Documents

Contemporary Luxury Perspectives by Ben Cox