Reinventing Luxury

We have talked a few times before about the fairly new phenomen of abandoning material possessions (like here, or here): It’s now established that we are shifting away from acquiring things towards doing things, or – to use bigger words – from “materialism” to “experientialism”.

Mind you, this includes also wealthy people who have traditionally been very prone to buy luxury goods. In 2011, for example, for the first time the “experiential luxury section” was bigger than any of the other sectors of luxury goods. In their latest report “The Next Luxury” (link in German) Swiss trend forecasters GDI Institute describe that the needs of luxury consumers are shifting dramatically. “There is less demand for material consumer goods and more for essential experiences, leisure time and sensual moments,” the report claims. Earlier this year, the Guardian also wrote about the new search for extreme experiences by the super rich:

Luxury is shifting rapidly from ‘having’ to ‘being’ – that is, consumers are moving from owning a luxury product to experiencing a luxury.

After decades of traditional consumerism it is dawning on most people (in western societies, anyways) that we get more happiness from experiences than we get from material goods. (Interestingly enough, this has only been proven in 2003 by two psychologists called Thomas Gilovich and Leaf Van Boven. Their paper was called: “To Do or To Have, That Is the Question.” Here’s a link to the pdf)

It does not mean that people are going to spend less money. They are just getting more careful about what and how they buy. One of the categories that will arguably see a big boom is the category of travel. Currently, all elements of a trip – from planning and checking in to being on of plane and arriving at your destination, are being overhauled by new technologies like apps, virtual reality, and artificial intelligence. PSFK have just released a great report showing what’s already being used by the travel industry, and online flight price comparison site Skyscanner released an interesting insight into the near and not so near future of travelling. One thing is clear, though: Nothing can replace the real experiences you make away from home – or as technology futurist Daniel Burrus put it in the Skyscanner report: “Virtual reality won’t replace real travel, as is often portrayed in sci-fi movies.”

Now there are plenty of brands out there that will think: Experience and travelling is great, but how does this sell more product? You have to undertand that this new type of luxury, in its new context is a search for true happiness. As stated in this interesting article: “It is the enjoyment of the best in life: the experience of beauty, knowledge, and humanity at their deepest and most inspiring. It is the sweetness of life.” Offering a mere status symbol won’t be enough before too long. You have to create a lasting positive experience around it: Be it your marketing, the showroom, or certain privileges associated with your product – everything becomes crucial in retaining the loyalty of your consumers. Or in short: A lot of companies have to master the transition from a traditional luxury brand to a contemporary luxury experience. Now guess who you should talk to in terms of experiential marketing?

Cover photo: RiOTPHOTGRAPHY.com/FlickrCC