For over a decade, the luxury sector has been undergoing transformation. At the economic level, one can note a strong expansion of the luxury market in France with an estimation of 14 billion euros in 2005.
By definition, luxury is a lifestyle characterized by spending a large amount of money on the purchase of non-essential high standard goods and services.
Formerly restricted to small circles of the rich, luxury products are progressively "down" in the street. The combination of luxury and marketing led way to a requirement: to open the luxury to many and make "the inaccessible accessible." The luxury today has several faces to different audiences.
There is also an extension of distribution networks, with an increase in exclusive boutiques and also the appearance of selective distribution channels of large retailers. Hence, there is a coexistence of two trends: the first conveys the power of the dream and the lure of luxury and the other standardizes and "demystifies" it.
Consumer expectations and behaviors related to luxury goods have also changed and one notes an evolution of superfluous consumption and taste for big brands.
In the first part, the environment of luxury will be explained and the second part will explain the marketing strategies used in this sector.
Solutions to the problem will be explained in the final part of the section.
Actually, etymology shows us that "luxury" is derived from the Latin word "luxus". Initially, this meant "to push through" or "to push with excess," to become "excess in general" and finally, it became "luxury" in the 17th century. This definition implies that the luxury is "out of the box" and imposes its own rules.
Luxury goods are defined as high quality products. The demand for luxury products increase when there is an increase in one's income. The luxury goods sector has 20000 companies worldwide and employs 125,000 people today and this sector is characterized by its strong tendency to concentrate and strengthen its international presence.
58% of luxury goods made in France are exported. Thus, Hermes International (a French fashion company) in its balance sheet showed an increase of 6% sales (1.2 billion euros) in 2001. Hermes opened many stores all over Europe, United States and Japan and in Japan there was a high increase of 23% sales. The luxury industry exports leather goods, perfumes, cosmetics, champagnes, wines and spirits, crystal and silverware.
The spirit of luxury existed even before the object of luxury. This "old luxury" was considered to be the exchange of gifts, earning honors and titles, to provide community linkages, construction of palaces and temples. It was a luxury that was concrete and useful.
It was only towards the end of the Middle Ages that modern luxury appeared and the taste of culture and love for antiques emerged. This luxury was aesthetic.
Until the 19th century, luxury functioned in an elegant and in a skilled manner. A person is attracted by the quality materials that are often used in luxury products: leather, linen, silk, silver, gold, precious woods, perfumes and so on.
[...] Luxury goods should be responsible for a strong aesthetic intention explicitly and implicitly; they must create the of a world with all that is missing in humankind, namely, perfection, knowledge and immortality. ϖ The classic luxury and modern works focus on emotions and decors "at home" so that the client feels good, while contemporary luxury is based on a range of relations Different sectors of luxury "Fashion companies of luxury" are groups of the the fashion industry which have operations in the manufacture of clothing, footwear, sweaters, leather goods, shoes, perfumes, cosmetics and jewelry, and other luxury goods that are articles of high quality, and of haute couture. [...]
[...] The luxury goods sector has 20000 companies worldwide and employs 125,000 people today and this sector is characterized by its strong tendency to concentrate and strengthen its international presence of luxury goods made France are exported. Thus, Hermes International French fashion company) in its balance sheet showed an increase of sales ( 1.2 billion euros) in 2001. Hermes opened many stores all over Europe, United States and Japan and in Japan there was a high increase of 23% sales. The luxury industry exports leather goods, perfumes, cosmetics, champagnes, wines and spirits, crystal and silverware History A brief history is essential to understand the evolution of this sector. [...]
[...] Luxury companies are currently concentrating their efforts on the conservation of their prestigious image through the implementation of various marketing strategies and investment of large budgets. Though the images of luxury brands are so hard to maintain, they are indeed proofs that image sells. To determine this, I asked myself whether such democratization will not ultimately harm the image of luxury. In the first part of my brief paper, I have presented reasons for the democratization of luxury brands. Here I will try to explain briefly the tools of this democratization. [...]
[...] ϖ Managerial changes Today, one would think that by democratizing, the luxury market has lost its specificity and during this process, the marketing of products and services becomes indistinguishable for mass consumption. Luxury marketing is thus found to be poor in methods, techniques and is dependent on consumer marketing. This trend of closer marketing methods for the consumer is therefore reflected in the choice of new leaders to head a company in the luxury sector. As a result, some groups like LVMH supply luxury products successfully, by marketing products from food items to cleaning products. [...]
[...] The pricing policy for luxury goods as intermediate is the result of the balance between the price of rarity, which is necessary to distinguish an imperative need of a wealthy class, and the price of controlled accessibility, which guarantees the right choice for customers "The indirect costs greatly increase the overall cost of the product and consolidate the elements of marketing which are essential to its competitive positioning. The identity of a luxury item is based on its creativity and a certain comfort of the image or the brand recognition. [...]
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