How luxury is shifting — Sage Perspectives Blog

By Giana M. Eckhardt and Fleura Bardhi

There is increasing evidence that traditional luxury does not hold as much cache in the marketplace or in society in general as it used to. For example, purchase of luxury real estate is down, and as recently reported by the New York Times, Old Masters, which used to be the sales bedrocks in auction houses like Christie’s and Sotheby’s, now makes up a tiny percentage of auction sales. Instead, art by living artists with a strong Instagram presence is more desirable.

Traditional luxury items like old masters paintings or luxury real estate are what we have identified in our research as solid luxury – durable and heavy, designed for the days when the global elite wanted status signals that adhered to a ‘big is beautiful’ aesthetic.

In contrast, our research shows that now, luxury is shifting to becoming more liquid, as lifestyles become more flexible. Consumers increasingly want to access luxury rather than own it, as evidenced by the rise of fashion sharing platforms such as ByRotation. Luxury that can garner attention, especially in online spaces like Instagram, is becoming more and more desirable, such as the ability to wear fashion rented from an influencer’s closet.

Additionally, objects and especially experiences that can signal consumers are in the know – an art star hot on Instagram, artisan made goods from local ingredients – become better signals of status and distinction than traditional, solid objects do. This is because when brands can be accessed rather than owned, they are no longer an unambiguous signal of wealth. Insider knowledge is more difficult to copy. Moreover, desirability in an on-line world is often signalled by affordances such as numbers of likes and followers, and the currency which leads to this acquisition of attention capital is the new, rather than the tried and true of the past, like Old Masters.

Finally, luxury is shifting away from products toward experiences. This is because luxury experiences display traits like knowledge, passion, and personal development, which are all highly valued as signals of distinction, and as mentioned, are more difficult to imitate. What is truly valuable to the global elite is an invitation to a dinner via an auction house with an Instagram art star, so the attendees can post themselves at the event, rather than the monetary value of the art itself, in terms of acquiring attention capital.

In sum, a diamond may be forever, but contemporary consumers value flexibility, and the one-time slogan of the century is looking more and more like an outdated mantra. The codes and signals of luxury are shifting, and it is important to understand the liquid, flexible, experience based, and knowledge focused core of luxury today, with the ability to garner attention at the heart of it.

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Article Details
New dynamics of social status and distinction
Giana M. Eckhardt and Fleura Bardhi
First published online June 13, 2019
DOI: 10.1177/1470593119856650
Marketing Theory

About the Authors

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Giana M. Eckhardt is Professor of Marketing and Vice Dean, Executive Education and External Engagement, at King’s Business School, King’s College London. Giana is a leading expert in the field of consumer behavior, consumer culture, consumer ethics and sustainability, branding, and the sharing economy. She is co-author of In Praise of Inconvenience (Princeton University Press, 2024), The Myth of the Ethical Consumer (Cambridge University Press), and co-editor of Handbook of the Sharing Economy (Edward Elgar). Her research has been featured in outlets such as The Wall Street Journal, The Economist, Vice Magazine, The Atlantic, Fortune, Vogue, Financial Times, Scientific American, The BBC, and on National Public Radio, among many others.

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Fleura Bardhi is a Professor of Marketing at Bayes Business School (formally Cass), City, University of London, UK. Fleura is a consumer behavior scholar whose research aims to explore how consumption is changing as a result of sharing economy, digital technology and globalization. Her research interests fall into the areas of 1) materiality, 2) access and ownership, and 3) consumer life transitions. Fleura’s work has been published in Journal of Consumer Research, Journal of Consumer Psychology, Harvard Business Review, Sloan Management Review, International Marketing Review, Psychology and Marketing, Marketing Theory, etc. She is also co-author of the Handbook of the Sharing Economy.