2. Individualization and Luxury

By Anna Speicher

Luxury has been subject to democratization for a long time, evolving from a customer base of the wealthiest few to a broad public including today’s middle class, which is looking to trade up to higher levels of quality and status (Silvenstein and Fiske, 2003). Luxury as a term has become so popular that more and more companies are using it to describe their products, even if they don’t actually comply with the definition of luxury in a narrow sense, increasingly diluting distinctions (Kapferer and Bastien, 2012). Together with the soaring accessibility of luxury, also its target group of customers has increasingly become fragmented, making it difficult to describe a typical luxury consumer (Wittig, Sommerrock and Albers, 2014).


The relationship that customers have with luxury and the pleasure derived from it has always been a special one, celebrated by those who could afford it, aspired by those who couldn’t.


As a concept, luxury has a very strong hedonistic component – it is a highly individual matter, closely knit to subjective, emotional and intangible values (Wittig, Sommerrock and Albers, 2014). This is by no means a new development. The relationship that customers have with luxury and the pleasure derived from it has always been a special one – celebrated by those who could afford it, aspired by those who couldn’t (Silvenstein and Fiske, 2003).

By implication of increasing prosperity in the last decades, money is being spent more freely and also the interest to getting to know a more emotional side of oneself is resulting in a plurality of goods and services available (ibid). Together with this prosperity also the overall satisfaction of needs is shifting upwards, leading to what can be described as a mass affluent market (Nunes, Johnson and Breene, 2004). With the simultaneously declining tendency to show-off brands through logos in developed markets, the emotional value that doesn’t have a price tag plays an even greater role than before (Wittig, Sommerrock and Albers, 2014). Luxury consumption is more and more moving away from being an end in itself to being a means of sending out a precise message about its consumers, about who they are and how they like to be perceived by their environment. Contrary to what has been a major motive only years before, the primary aim of it is not, by default, to impress others or actively show superiority – the emphasis of the truly affluent UHNW clients lies on self-expression (Doran, 2014). One’s own choice becomes a determinant for one’s sophistication and success, as well as an additional way of showing individuality and displaying personal values, not to the masses but to one’s self and a strictly confined circle (Silvenstein and Fiske, 2003).

Against this background, it is no surprise that the possibility to customize products is taken as a given by many luxury customers and an accepted justification for considerable price premiums that come with it. In the same way that ordinary consumers prefer to make alterations to their everyday consumption from playlists to sandwiches, affluent and not yet rich alike do not want to content themselves with standard options available for everybody (Wind and Rangaswamy, 2001). In a world of increasing luxury consumption, there is no better way to add emotional value and distinguish oneself from peers than by acquiring unique, custom-made products with a personal connection, according to one’s exact imagination. While consumers generally value self-created products more than those without an input of their own (Hildebrand et al., 2013), for the affluent luxury is above all about achieving a sense of uniqueness that excels any combination of standard purchases (Silvenstein and Fiske, 2003). It is such prospects of ultimate selectness that will be able to spark desire, new buying impulses as well as strong loyalty of customers to a provider of individually tailored goods in the future.

In a similar way, individualized products can be particularly interesting for the almost rich clientele as well (Johnson and Nunes, 2002). Accordingly, the possibilities of individualization can range from simple additions of a customer’s initials or other inscriptions of personal value up to entirely unique compositions of indefinite single elements. While the latter has been implemented by producers of high investment products such as yachts or private jets for a while, above all the high fashion industry has realized the potential to set oneself apart from fast fashion easily, as recent examples of engraving and stitchery services by brands such as Burberry, Louis Vuitton or Hermès suggest. While special, limited editions have been common in the fast-moving world of fashion for a while, new ways to establish rarity and desire will not only combine customization but also DIY-components for an even more personal touch for the customer. And the trend doesn’t apply to tangible products only. What is also referred to as experiential luxury, is what the coming generation of affluent is looking for: to live unique, outstanding experiences that others haven’t before instead of owning physical objects (Blackden, 2016). Especially younger generations seek for their very own luxury experience, with possibilities to express themselves in the exact ways they want to, without the influence or approval of others (Wittig, Sommerrock and Albers, 2014).


What is also referred to as experiential luxury, is what the coming generation of affluent is looking for.


Exceedingly, luxury tourism is benefiting from the potentials that arise from the possibilities to offer customers unique experience, specifically tailored to their needs (Wittig, Sommerrock and Albers, 2014). While fulfilling sophisticated but standardized checklists will remain a basic necessity for the various actors in luxury travel, gaining an individual customer insight will be crucial to offer services that go much further than the common standards (Brant, 2016). Highly skilled and attentive staff that is willing and able to perform beyond the usual service proves to be an invaluable unique feature for outstanding satisfaction of the needs of customers.

Furthermore, services in this sector will have to combine high-ranking luxury amenities with regional elements, making for a one of a kind, authentic experience for an even more limited group of customers. Locally inspired interior or exclusive meeting places with selected local personalities are options to induce a more authentic atmosphere. Incorporating hotels and other touristic institutions into buildings with a special historical connection can be another appealing way to cater to the demand for more authenticity. Yet another guarantor for extraordinary, one of a kind experience can be travels to the few remaining destinations that haven’t been touched by tourism yet or regions and sights that are endangered for different reasons and will thus not continue to exist in the near future. Extreme examples here can reach from space travel to diving the ruins of the Titanic (Doran, 2013).

Just as well, online and digital services are experiencing an individualization too, acting as touch points for extraordinary experience where it is not necessarily expected yet. Even those that are specifically targeted at masses, such as e-commerce and of course CRM, which is a critical instrument to understand and cater to the customers’ needs: offering in-house tailors for online customers is a way of catering to the demand for more individualized services while joining in the seemingly impersonal development which has also caught up with luxury retail some while ago (Pinault, 2014).

The arising complexity can be opportunity and threat alike (Wittig, Sommerrock and Albers, 2014). While more and more affluent customers are explicitly looking to acquire products specifically tailored to their individual tastes and willing to pay a surcharge, limitations may arise on the operational side, above all. Pure mass markets in their original form have cumulatively evolved to mass-customized markets. In such an environment, companies have to master the art of being successful by providing their customers with the products they want at a price that they are willing to pay. While consumers expect an unlimited freedom to choose (Pedraza and Bonabeau, 2006), a critical factor for success is to manage to meet the expectation of customers as closely as possible and not overwhelm them with a variety distracting them from their desire at the same time (Pine, 2011). Customization needs to accord with the inner vision of customers as accurately as possible, otherwise it can leave them even less satisfied as they would have been with a standardized product (Wind and Rangaswamy, 2001). In contrast to this, it is just as important for brands to find the right way to continually advance the brand at its high end and not compromise its essence at its low end at the same time (Silvenstein and Fiske, 2003). The investments needed to implement customization of products and services in a way that it speaks to the really affluent and not just the masses yet again, to enable such variety in small quantity, can present an obstacle of its own (Kapferer and Valette-Florence, 2016). Additional challenges to offer highly individualized services are aspects such as timely production, the sacrifice of economies of scale or the securing of aesthetic quality of the product and with it the image of the brand (Abnett, 2015).

Still, if implemented correctly on the operational side as well as in terms of a targeted understanding and leadership of the customer, the trend of individualization bares immense potential for the future: Offering individualized products is a powerful remedy for the loss of exclusivity caused by the increased accessibility of luxury.


Speicher, Anna.jpg
Anna Speicher




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