Conspicuous Consumption

For those interested in individuals psychological need to buy luxury goods Thorstein Veblen is the man!

Thorstein Veblen was the first one to analyze conspicuous consumption, whose only purpose is to show off ones wealth, in his book “The Theory of the Leisure Class”

Theory

 

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How Luxury Lost its Luster

deluxeDemocratization of luxury goods

Can the mass-produced luxury brands continue to call them selves luxury brands? And is it still considered luxury if everybody can afford it? 

These are the questions at the heart of fashion reporter Dana Thomas’ book Deluxe – How Luxury Lost its Luster. She’s been around the world and talked to some of the most important people in the fashion industry to get to the bottom of the issue.

Before, luxury was connected with exclusivity and uniqueness accessible to the limited few that could afford it. Today, thanks to globalization and mass-production, luxury has reached the middle market and luxury products have become more available, economically and physically. In her book, Thomas argues that during this transformation, luxury brands might have lost not only their uniqueness but also their integrity. 

Thomas goes behind the scenes and unveils the ugly underside of the industry, from women working as prostitutes in order to afford a LV handbag, to the sweatshop workers in China who make these same handbags. Some of them, buyers will never know were made in China thanks to relabeling of these products. After all, “made in China” does not sound as fancy as “made in France” and might give the brand a bad image. She also discovers that in order to meet profit forecasts, the luxury companies use inferior materials while at the same time raising their brands prices exponentially. 

But why do consumers keep buying these brand name products, paying a lot in exchange for a product of such inferior quality? Successful marketing campaigns have helped spur the demand but also the individual’s eternal need to impress others. But without the demand, there would be little to no counterfeits, and as a result no organized crime, etc., that Thomas exposes in her book. 

However, there are some manufacturers and designers that have refused this trend of “going mass market”. To them, it is not all about the profit but service and making exceptional products while being true to oneself. As Christian Louboutin puts it in her book: ” I did not do a company to make money. I made shoes and it became a company.” 

These last few decades, the luxury market has been marked by pursuing a growth strategy of developing new markets for already existing products mostly through geographical expansion to new markets. And while the investors have profited from diversification and economies of scale, the consumers have received something back in form of more accessibility. Consequently, luxury is now everywhere and not as exclusive as it used to be. At the end of her book, Thomas wonders how long luxury goods are going to call themselves luxury goods. 

This book is amazing and very entertaining! It fills you in on all the essential details behind the fashion industry. There is some historical info about the designers and luxury in general as well as the luxury moguls. It is a great inside look into what is going on behind the curtains.