Press Release

‘New’ Luxury  Paradigm Shifts to Experience

Old Luxury is about the ‘thing;’ New Luxury is the ‘experience’

Stevens, PA  May 6, 2004 —  The phrase ‘new luxury’ is tossed around a lot of late, often synonymous with ‘masstige,’ i.e. mass prestige, as it applies to affordable, new generation luxury brands like Starbucks, Victoria’s Secret and Panera. 

However, the concept of mass-marketed luxury doesn’t go far enough to explain the paradigm shift that is taking place in the luxury market today.  “The real shift in the luxury market is a change in the way consumers define luxury.  ‘Old luxury’ is defined by the attributes, qualities and features of the product, and usually refers to heritage brands that charge a premium, such as Mercedes, Christian Dior, and Cartier.  ‘New luxury’ defines the category from the point-of-view of the consumer,” explains Pam Danziger, president of Unity Marketing and author of Why People Buy Things They Don’t Need.

“Based on new research conducted by Unity Marketing, luxury consumers focus on the experience of luxury embodied in the goods and services they buy, not in ownership or possession itself.  So ‘new luxury’ is about the experience of luxury from the consumers’ perspective, while ‘old luxury’ remains focused on the traditional, product-based definition of luxury.”

Two ways to define luxury:  intrinsically and consumer-centrically

In the old luxury world view, luxury is defined as the special qualities, features and attributes  intrinsic to a product.  In most categories, whether fashion, automobiles, furniture, linens, jewelry, or tabletop, specific product features constitute luxury.  For cars it’s handling and ride,  leather seats and wood detailing; in jewelry, platinum and real gemstones; in linens, 500 thread- count sheets, Egyptian cotton, etc.  Here the product expresses or incorporates features that confer the ‘best of the best’ status.  Many old luxury companies stop here, focusing their resources only on creating the ultimate product.

New luxury companies recognize that the intrinsic definition of luxury does not reflect the changes taking place in the luxury market today.  “New luxury companies recognize the need to incorporate consumer experience and perception into the luxury branding equation.   They begin by offering the ‘best of the best’ quality, but go that extra step to deliver not just a great thing, but a wonderful experience to the customer,”  Danziger says.  Luxury companies like Tiffany, Godiva Chocolatier, Saks Fifth Avenue, KitchenAid, Sub-Zero are attuned to this new experiential luxury paradigm.

In recent focus groups new luxury was described as:

·        Quality is in eyes of beholder.  We often associate quality with expensive, but it doesn’t necessarily have to go hand in hand.  Sensual experience, massage, wonderful dinner, travel, a treat, something very special you do for yourself.

·        A state of mind, being able to do something that I couldn’t do before.

·        Luxury means I can live my life in a way that I don’t have to worry about money.  Luxury doesn’t mean labels.  It means comfort.  If I want to go somewhere and I am able to do it, that is luxury.

·        Luxury to me is not a necessity, but a privilege.  It means to be able to do things in regard to services, time, material things.

·        The most luxury ever is to have enough time to do whatever you want and be able to afford it. 

·        I buy what I like and what I want.  It is nice to have that feeling that you can do what you want when you want it.

“When we talk about luxury from the consumers’ experiential perspective, the brand becomes irrelevant.  What matters is how the brand delivers the luxury experience it promises,” Danziger says.  “In other words, ‘old luxury’ is about the thing (i.e. a noun), while ‘new luxury’ is about the consumer experience (i.e. a verb.)”

Luxury brands and the role they play in luxury purchasing is the subject of investigation in Unity Marketing’s 1Q2004 Luxury Tracking Study, based on a survey of 650 households with incomes over $75,000 (one-third over $150,000).  Panelists reported purchasing luxury goods and services over the most recent two months, attitudinal and expectation data about their households and the economy. Unity Marketing publishes its Luxury Tracking Study quarterly.  For more information, visit http://www.unitymarketingonline.com/reports2/luxury/luxury1Q2004.html or call Pam Danziger at 717-336-1600.

About Unity Marketing
Founded in 1992, Unity Marketing (www.unitymarketingonline.com) is a marketing consulting firm that specializes in consumer insights for luxury marketers.  Pam Danziger is the company’s founder and author of Why People Buy Things They Don't Need revised edition (Ithaca, NY: Paramount Market Publishing, 2004) which uncovers the motivations, desires and emotional needs that drive consumers to buy. Unity also publishes market research studies on the luxury market, jewelry, garden, pet accessories, home furnishings, gifts and collectibles, greeting card and stationery, tabletop, art and wall décor markets, as well as the Luxury Business newsletter. Pam is currently working on her second book, Let Them Eat Cake: Marketing Luxury to the Masses — as well as the Classes, to be published in 2005.

To arrange an interview or other media inquiries contact: Len Stein, Visibility, 914-712-2610; lens@visibilitypr.com