last highlighted date: 2024-11-04
Highlights
- Luxury’s soft power kept its value and price together. Price made something more desirable (the Veblen effect) and no one questioned the price thanks to perception of value. This value was material, but mostly cultural and social: when an item sold too well or too quickly, a luxury brand would discontinue it.
- Luxury’s desirability - perception of value it enjoyed - fueled its economic growth. There are few industries more powered by dreams, imagination, fables and heritage than luxury. Luxury growth didn’t came from products, but from the intangible social and cultural capital it created. Cultural hits - Hermès Birkin, Chanel tweed, Rolex Daytona - became market hits.
- Brunello Cucinelli is known for citing Horace, Cicero, Socrates and Aristotle and meditating on the idea of humanistic capitalism. The Dream of Solomeo is a celebration of a lifestyle, humanity and betterment. Cucinelli’s luxury beliefs are as expensive as his clothes.
- Luxury is a game of identity. Identity is what differentiates luxury strategy from strategy of premium and mass brands.
- premium and mass brands communicate how they are better/cheaper/faster than competition. Luxury brands don’t. (Or,
- Instead of doubling-down on identity, most luxury brands doubled-down on creating more products.
- A lot of luxury brands organized themselves as commercial entities fiercely focused on their own efficiency, cost-cutting and bottom line. This growth strategy made a lot of them forget who they are, what they stand for, and the role they play in culture.
- As sociologist Georg Simmel observed, fashion elevates “even the unimportant individual by making them the representative of a class, the embodiment of a joint spirit.” So does a Balenciaga coat.
- Perhaps they are better at predicting the future. Science fiction writer Frederik Pohl said that a good science fiction story should be able to predict not the automobile but the traffic jam. To predict the “traffic jam,” luxury doesn’t need a new competitive strategy. It needs a new cultural strategy.