The notion of luxury is shifting from permanent, physical object ‘possession’ to transient, intangible ‘experiential luxury’ – a change which has put luxury’s traditional hierarchy at risk of revolution, writes Wealth-X.
A common refrain of the past half-decade has been the decline of luxury ‘ownership’ and the rise of luxury ‘experience’. If this is to believed, then we are moving, they say, away from permanent, physical object ‘possession’ and ‘personal luxury goods’ into transient, intangible, service-dominated ‘experiential luxury.’
The data seems to support the theory. Luxury appears to be evolving into ‘being’ and ‘doing’ than simply ‘having.’ More money is spent on luxury travel, the classic ‘experience’ category, than any other category. Of the $1.8trn spent on luxury between 2013-14, $1trn was spent on ‘services.’ An incredible $460bn was spent on luxury travel adventures such as expeditions to the Antarctic or bespoke safaris. A mere $170bn was spent on personal luxury goods. (Source: BCG).
“ What we call luxe today is just ridiculous ”
Some commentators point to the fact that notions of luxury, particularly in mature Western markets, are becoming more sophisticated and personal, in contrast to the badge-led luxury of developing markets.
Whilst everyday ‘luxury’ items such as designer handbags are still valuable companions for consumers, this is met with scorn by certain commentators. “What we call luxe today is just ridiculous” says Pierre Berge, Yves Saint Laurent’s lover, business partner and now patron of the arts “A handbag that a woman takes with her all over the place — to a grocery store, through the airport — I cannot imagine how that can be considered luxury.” (Source: NY Times)
Indeed, many would agree that what is ‘everyday’ cannot, by definition, be a luxury. But a woman’s brand of handbag, much like a man’s wristwatch, is an everyday ‘reminder’ to its owner and those they encounter that they ‘belong’ at a certain level of society.
“ Experiential luxury is one-off and unrepeatable. This makes the moment of experience ever more important ”
Much of experiential luxury is one-off and unrepeatable. This makes the moment of experience ever more important; particularly for those trading up into it.
Therefore, experiences have had less of a potential to act as a reminder in this way; enjoying the rooftop spa at the Berkeley Hotel or taking a NetJets flight to see an opera star at a palace in Spain are private, personal experiences.
In fact, the privacy and rarity of these ‘moments’ is often why they are more coveted by wealthier clientele than physical, personal luxury products. With little to prove, the wealthiest individuals are less concerned with luxury badges and whether they are accepted in social groups; personal requirements and tastes shape their worlds.
Ithaa restaurant, Maldives
For the less wealthy, those occasionally trading up, luxury experiences are even rarer. Although that makes them more luxurious in one sense, it has made them difficult to trade on. They have been transient, temporary. They represent one-off sorties into the ‘way the other half live’; for those conscious of their social position, they do not have the solid, everyday reassurance of an Hermes bag or a Patek Philippe watch; extravagances that the mass market or merely affluent have clung to as badges of their ambition as much as anything else.
It has therefore been elite personal luxury brands that have dominated the last half-century, following the revolution of advertising, photography, the growing and intrusive cult of celebrity and advanced brand lifestyle marketing and sponsorship. Before brands, it was materials and jewellery that visually demarcated a social grade; fine silks, gold, silver and precious stones were totted up on some gilded abacus.
However, this predicted decline in physical ‘ownership’ would seem to threaten such straightforward social delineation; were it not, it has to be said, for the increasing dominance of social media in our everyday lives.
“ Sharing on social media has revolutionised the nature of luxury experiences ”
Sharing on social media has revolutionised the nature of luxury experiences. With ever-growing networks of family, friends and like-minded individuals, people are freeze-framing and sharing extraordinary and socially-aligning ‘experiences’; check-ins at five star hotels, VIP boxes at rock concerts, first class cabins on airlines, boat charters, helicopter excursions and Michelin-starred meals.
Far from fleeting, in-the-moment enjoyment and inward enrichment, these individuals are also ensuring that they externally ‘own the moment.’ And instead of sharing a small photo album with a family group, there is an enormous temptation to open up these galleries to the thousands and millions of followers.
These captures are also opportunities to create something that has the appearance of permanence out of something transient; a small sense of ‘ownership’ in something that is impossible to own.
“ Both are symbols of a lifestyle, but one has greater currency as an emulation of social alignment ”
They are also arguably far more effective in crafting a ‘lookbook’ of a desirable lifestyle than the simple presence of a Balenciaga handbag: an expensive handbag is often seen as a significant lifestyle ‘investment’ as it is used every day whereas a short stay at the Hotel de Paris is more a symbol of true extravagance. Both are symbols of a lifestyle, but one has greater currency as an emulation of social alignment.
Whilst this is obviously good news for the experiential luxury categories of travel and entertainment, it should also be reassuring and exciting for personal luxury goods. The deep societal codes of luxury and elitism are, it would seem, alive and well.
To further investigate the concept of experiential luxury on Luxury Society, we invite your to explore the related materials as follows: