Why write about a book about selling luxury products and services when we are in a recession?
First, the group of consumers for which spending tends to hold up best in an economic downturn are those with money.
Second, the products and services for which the gross profit margins are the greatest are luxury products. Companies like Wal-Mart that attract lower-income customers mostly operate on razor-thin margins. Most small businesses will find it hard to compete against these "big box" stores unless they can find a way to differentiate their offerings to justify higher prices.
Third, even consumers with lower income aspire to owning or enjoying a few luxuries. Consider the family living in a rented mobile home with a satellite antenna and a big-screen HD television set.
This book is based on a two-year study conducted in association with House & Garden magazine profiling exceptional companies that "get it right" when marketing to their customers at all levels of the market.
Pamela Danziger points out that the natural evolution of all luxury concepts is from class to mass. Luxury is first introduced and embraced by the affluent and then it is translated and reinterpreted to the masses, so today’s luxuries become tomorrow’s necessities.
The luxury marketplace has changed dramatically because the middle class has declined, with two-thirds of the change going from middle class to affluent and one-third of the change becoming lower class.
Most of the affluent market consists of mature baby boomers whose children have grown. Now the mature boomers are leaving their "cocooning" lifestyle revolving around the home behind and becoming more involved in social interaction and traveling.
There has been a shift in the concept of luxury from "stuff" to "experiences." The new luxury market is concerned with luxury as contributing to self-actualization. How can luxury contribute to a better quality of life? It may be by outsourcing to gain more time. It may be by enjoying great experiences traveling. It may be by being pampered at a spa. It may be by enjoying pastimes like practicing gourmet cooking or other personal interests.
Small businesspersons should be as concerned with the experience the customer has interacting with their business as with the products and services they are offering. She gives an example of a nursery arranged as a beautiful garden.
Anyone who is studying the luxury marketplace will find valuable insights and statistical information in Let Them Eat Cake.
Let Them Eat Cake: Marketing Luxury to the Masses - As well as the Classes
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