The meaning of luxury

What does the word ‘luxury’ make you think of?

Perhaps it conjures up images of sports cars, private jets and fabulous mansions. Or maybe a pleasurable experience such as enjoying a fine cigar, or a massage at your favourite spa. Or does luxury to you mean something even simpler, such as watching a beautiful sunset or spending a lazy morning in bed?

The fact is that ‘luxury’ can mean countless different things to different people. Thanks to decades of over-use by marketing agencies and the media the word has lost all definition, becoming a catchall term applied to almost anything from a hamburger to a holiday in the Maldives. Often it is just used as a convenient prefix in order to justify a higher price tag.

However, as society changes, the concept of luxury is changing too. As the number of millionaires and billionaires on the planet increases, so too does our exposure — through media and marketing campaigns — to the ‘luxury lifestyles’ of the rich and famous. Advertisers would like us to aspire to these lifestyles (and work harder and spend more to achieve them). For the most part, it’s a tactic that works all too well.

There is a flip side to that record, though. As consumers, we are smarter and better informed than ever before, and over-exposure to the lifestyle dream has desensitised us to the idea of luxury as a purely material concept. The upshot of this is that those who seek to dazzle us with desirable goods are forced to constantly up the ante, dreaming up ever more elaborate luxury products in an attempt to catch our eye. A gold Lamborghini? You got it.  A $666 burger? Coming right up, sir.

Look carefully, though, and amid the cacophony of excess it is possible to find the green shoots of a new luxury paradigm. Rather than falling for glitzy novelty with a sky-high price tag, discerning buyers are beginning to favour products that offer a deeper, more lasting emotional capital. Instead of chasing after empty status symbols —the golden Lamborghini at the end of the rainbow —we are seeking something more meaningful. Real luxury is becoming less about status, and more about state-of-mind.

These more enlightened spending habits are embodied in a new set of luxury values; practical design, fine craftsmanship, quality, simplicity and above all authenticity have replaced novelty and flamboyance on the luxury wish-list. Affluent buyers tend to be highly mobile global travellers, and the products they want reflect this. Lightness, functionality, durability and minimalism are coming to the fore, often driven by technical innovation. Discerning buyers are growing less interested in brands that help them to be seen, and more into those which themselves have a vision. Needless indulgence is being replaced by a desire for cool, sleek utility.

 More conscientious social attitudes (due partly to the financial instability of the last decade) have caused buyers to think harder about each purchase, and demand a more emotionally fulfilling connection with their chosen product or brand. More than ever before, an individual’s status and strength are communicated not only by their material wealth, but also by their personal values. It is no longer sufficient for a luxury item to reflect the owner’s aesthetic preferences; it must now reflect their ethical ones too.

Increased focus on and awareness of ethical and environmental issues means that any company with a public face must have its house in order. With the company history, employment practices, manufacturing standards and social responsibility of every brand now subject to scrutiny (and any transgressions likely to be punished with a public flogging on social media), transparency is the order of the day.

Smarter companies are adapting to these changing consumer demands by opening their doors and inviting their customers backstage. The zai ski factory, for instance, operates a daily open-house policy, encouraging visitors to tour the factory, meet the workers and witness every detail of the manufacturing process first-hand. Sales and media events are regularly held in the ski workshop, with journalists welcome to write about what they see.

Customers find this approach incredibly refreshing, as it allows them to connect with the company and better understand the real value of the service and goods it provides. When a company has nothing to hide, it has nothing to fear. Transparency demonstrates total confidence in your product.

As our ideas of luxury shift away from the material and more towards the experiential, brands are adapting the ways in which they connect with their customers. Social media and the internet allow a closer day-to-day dialogue, allowing consumers to stay in contact with their favourite brands — even to the extent of tracking the development of a new product from the design stage to the shop floor. Improved communication can result in improved service, as companies listen more intently to the feedback from their customers. The line between producer and consumer becomes blurred, allowing the buyer to engage on a deeper level with the brand.

Providing customers with a richer brand experience is an integral part of the new luxury paradigm, and nowhere is it more evident than in the booming events sector. zai, which has its own very successful events wing, is part of the new wave of luxury producers inviting their customers not merely to listen to their brand ethos, but to live it. By holding regular events such as factory open days, ski demos and exclusive weekend trips, zai allows its customers to experience the relaxed atmosphere of the ‘zai way’, and enjoy the product in an environment that’s in tune with the company’s values. Events of this sort also create a natural sales platform, without the need for the dreaded ‘hard sell’.

Of course, not every company is so forward thinking, and many will be content to keep on offering trinkets as a substitute for real luxury for as long as people continue to buy them. But if you want to know the future of luxury, just look to companies like zai; an innovative brand which offers not only high quality product but authenticity, transparency, a willingness to engage with its customers on an equal footing and a readiness to live by its principles. Real luxury is much more than just a logo and a price tag; it’s a feeling, and a way of life.

By Heinz Ramseier with Sam Tinson

The new luxury paradigm

At zai, we have an open-door policy. We ski, hike, eat and drink with our friends in the glorious Swiss Alpine surrounds we are privileged to call home, sharing our experiences and creative endeavours. Our clients effectively become family members.

But what does luxury really mean today? And how does it relate to substance and meaning in our everyday lives? Products are judged against their price and which rung they occupy on the ‘luxury’ ladder - but why should somebody feel an actual need for a high-end commodity?

Luxury lifestyle companies’ have internal machinery that measures customer reactions. Marketing departments formulate plans, programs and promotions that measure sales increases. Brand DNA is ascertained, ideas and concepts are hammered out and conclusions are drawn from data analysis. But has anybody asked, along the way, what a customer journey or experience actually means?

That’s what we’re doing now. We’ve created what we call Unique Feeling Perceptions (‘UFPs’), which will help breathe new life into our business. When it comes to business solutions, the customer – and touching the customer’s soul - should be the focal point. Ethics, respect, love and feeling are at the core of this mission. We take inspiration from Mother Earth when it comes to forging relationships with our fellow humans. It’s a model that puts honesty and reliability, rather than money, at the heart of an on-going quest to formulate a new, nobler form of luxury.

The new luxury paradigm is very family focussed. Important areas within it to consider include:

1)          Family focus versus community thinking

2)          Family management versus single membership

3)          Family evolution versus regression

Our philosophy on these areas established, it is upon these pillars that we hope to build a profound bond between our products and our customers. This will result in return on investment, profit optimisation and much, much more – but what counts the most is a positively loaded experience for our entire client base.

We plan to dive into clients’ emotional world, focus on their senses, and revive buried dreams that have so often been suppressed by behaviour patterns. Such dreams are often linked to childhood memories - “Back then, when we had time, and felt safe and secure…” We call this, quite simply, “Family Spirit”. Customer experience management and customer journey management are inextricably linked. Success or failure is dependent upon tapping into this link.

When it comes to diving into the philosophy of family spirit, we want to move people, to touch their emotions, and to communicate community participation and a focus on nature, remaining authentic throughout. To that end, we need to slow down the churn of everyday life. We must create a new, state-of-the-art model for events – a clear, simple approach that customers can relate to, and which gets back to our roots by offering customers the life-enhancing use of our products. Our events should encompass the spirit of these new objectives, resulting in awesome experiences.

When it comes to family focus blended with community thinking, trust, participation, honesty, feelings and emotions should bind our family as if by blood. Community thinking, meanwhile, still allows any individual member to explore on their own at any time.

Family management versus single membership can be adapted to both BtoB and BtoC business strategies, throughout which we try to combine and integrate processes into one system and make the most of a digitalised world. Today’s systems can work against each other (inter-personal envy can destroy potential sales) so inclusivity is paramount, as is global authenticity.

Offering transparency with choice – with both the whats and the hows - forms the basis and focal point of “family spirit”. All brand promises are to be conveyed concisely, with clarity, and in keeping with the brand philosophy and image – and must, without exception, be kept, honesty being one of our principal objectives. Generally speaking, the simpler the better (although a minimalist approach can, of course, be challenging, since an enterprise’s communication needs to describe its key attributes and tendencies accurately as well as sharply). There is the potential, many would say, for a competitive atmosphere to arise here: I hold a different view. When it comes to a network, a unit is a stronger entity than any single family member.

Family spirit – the heart of The New Luxury Paradigm

Values change with time. Decisions are based on both emotional and rational factors. These must be defined and integrated in a targeted way. In this area, we must compare characteristic touch points, create contact points, then express the same variables both physically and digitally. Family evolution versus regression in the coming generations is packed with challenges: but challenges are there to be embraced.

It is more important than ever that we manage customer interaction across our entire enterprise. With customer touch points long gone, we must optimise client experiences across multiple channels and product lines. We must start to create effective, increasingly customised customer experiences for real-time enjoyment. To gain a clear competitive advantage on all fronts, our resources must be dedicated towards exclusivity over maintaining the tedium of the status quo. With that strategy in place, everybody will perform substantially better across the whole of our enterprise, from profitability to customer retention.

The challenge is also the goal. Customer experience programs will fundamentally change customer interaction and how it is managed. Greater efficiency requires long-term focus and a commitment to transformation. In order for all of us to achieve better business results, we must consistently generate optimal customer experiences.

The higher a brand positions itself on the luxury scale, the more critical the degree of customer experience management. And the differentiator, in the new luxury paradigm, is family management. It’s all about expectations for family members over single community members. You have to map-out and understand the whole flow of the family experience, which results in a more authentic, more profound understanding of the customer touch points required.

The factor that binds family focus, family management and family evolution is family core values – principles that emphasise the emotional over the material.

What matters most is the complete customer relationship, encompassing how each experience is orchestrated, how the bumps are ridden and what the customer’s perception is of that experience along the way. Businesses need to manage these elements in a holistic way in order to truly understand what their customers want. The result? Increased loyalty and, ultimately, higher profitability.

And there we have it: a carefully planned, thoughtful, continually monitored and flawlessly executed strategy - the new luxury paradigm.