Luxury Goods: To Buy or Not to Buy?|
I did not know my grandmother well. But what I do remember of her was her Chanel No. 5 perfume. And to this day on my childhood dresser, I’ve kept her last bottle.
It’s no longer the actual use of the perfume that means something to me-rather, the meaning lies in the life that that bottle has taken on as a memento of my grandmother. It represents, for me, the woman she wanted to be. My grandparents were not wealthy, yet my grandmother was so taken by the woman epitomized by Chanel that she saved up to purchase Chanel No. 5.
Then there’s my mom who takes every opportunity to bring up that when she was my age she impulsively bought a convertible, and afterwards couldn’t afford any new clothes for over a year. Friends of mine, too, have similar disparities-some making sacrifices and budgeting their purchases responsibly, and others turning a blind eye to their financial limitations.
What do luxury goods do for our brains?
Many of us share similar stories: overspending on items we shouldn’t necessarily buy is a common trend in this generation and the last. This type of buying behavior is something I see everywhere– including from myself. Why does it happen? I’ve always been curious. And moreover, the source of my own hamartia has always been a lingering question: luxury goods-are they worth the price tag? And if they’re not, what are our brains doing to trick us into thinking they are.
To begin my quest for answers, I spoke with Simone Esposito, an expert in all things luxury. As head of business development for a prominent women’s apparel company, Carlisle, and with a history that includes directing corporate sales for Loro Piana, Simone has a grasp on the power that luxury goods can have over consumers. The luxury market is one with many complexities-a significant complexity being that oftentimes the purchase of luxury goods isn’t actually meeting a material need. The propensity to purchase luxury items is especially confusing in light of research showing that we garner more happiness from experiences than from items.
I entered my conversation with Simone looking to understand why luxury goods are important to our society and what they actually mean about us. According to Simone:
“The luxury industry is a very important part of global business because it includes many other industries-autos, beauty, fashion, travel-and it sets the highest production standard at top price point. Luxury is not only seen as useable assets but it is also global investment because it can almost always enter the international market for trade at a later date, it gains value as it become vintage.”
I’m not sure if I could resell my grandmothers vintage Chanel No. 5 perfume– in fact I haven’t smelled it in a while– but it means more to me than money. And this is in line with Simone’s perspective on luxury goods. “Luxury is aspirational, is a dream, it is an experience on top of the item itself,” he says. “Therefore luxury sells an idea-and sometimes an illusion-behind that famous logo.”
This made a lot of sense: luxury goods are often paired subconsciously to consumers with both a dream and a dream lifestyle. And much of that dream also includes the statement that owning something beautiful sends to others: elevated status.
How many of us are influenced by brands? Who isn’t influenced by brands? A branded item represents the promise of quality of production, manufacture, and relevance. In the recent economic recession, luxury items have been hard hit-largely because, as Simone emphasized, it is hard to cut costs in luxury. Now matter how hard wallets are hit, the sourcing of rare materials and the training of craftsman who demand a higher pay rate is hard to replace without sacrificing brand solidity.
As a young professional woman, I don’t have the expendable income that I one day hope to have. Long story short? I’m all about a good deal. So I asked Simone to give me a short-list of items that even a young professional should consider splurging on. His list? “I personally go for quality classic items and brands rather than seasonal pieces. The consumer of luxury is now buying less items each season but certainly of a higher quality.”
While I strive to be more responsible financially, it is nice to know that I don’t have to get caught in the madness of luxury good marketing in order to benefit from the design and structure of the industry.