Business of Luxury: a Philanthropic Power?

Luxury Today and Philanthropy

Luxury Today and Philanthropy – Chime for Change founded by Gucci

MILAN, Italy — If you want to be “à la mode”, you have to be “luxury” today. What is luxury? Luxury is not just a multiple (semantic) meaning word, but a real social psychological question. A different and global way to interpret a product, a brand or a business. In this article we will try to clarify the main foundations of luxury.

Today’s Luxury Concept

Luxury has evolved from some radical social and economical changes that have involved, in the second half of the 20th century, the whole of humanity. Three key aspects have contributed to this:

  • Democratization – Customers of luxury have grown exponentially, making luxury more affordable, without implying an intrinsic vulgarisation and the loss of value.
  • Globalization – The access to new luxury products from new cultures and markets.
  • Communication – The global mass media development have made us more aware of the diversity and cultural richness of our planet and the many other ways of living (in our own societies).

Luxury in Numbers

According to Italy’s Fondazione Altagamma:

In the next six years, the luxury market will rise from approximately € 730 billion to € 880 billion euro, with an increase in luxury consumers from 380 million today to 440 million by 2020.

The Altagamma report emphasizes the importance of on-line distribution for the growth of luxury sector. “By 2020 the current €4.5 billion will increase from 2.6 percent of total distribution to 20 percent yearly, with an average rise of €11 billion in 2015.” The report underlines the close relationship between online and offline in the retail distribution process too:

Before buying in-store (70 percent of Americans and 63 percent of Chinese) do research online. In the same way, 70 percent of current luxury distribution in Europe (59 percent in the US and in China) is preceded by a retail store experience.

That lets us understand how social media, and the on-line experience in general, are critical to increasing brands’ and products’ visibility. “68 percent of customers mainly form their opinion through the brand website or specialised online magazines (50 percent) for a more independent and detailed view.”

Brand Equity

    • Luxury is brand – There is no luxury without a brand. A luxury brand is first a brand and only afterwards luxury. The luxury’s appearance is just relative to the multi-sensory nature of product (sight, touch, smell…) and its story (about materials, finishes and cut).
    • A luxury brand is a person – The creator is first of brand: his rich and complex universe, besides his personality, contributes to keep the brand alive, even after his death.
    • A luxury brand has its roots – It is not invented, but a real story.
    • A luxury brand must be able to perform an ontological function – For this purpose, it is necessary that the brand is known in addition to its actual customers, recreating the social gap, thus the “distance”.

What is Eco-Luxury?

The planet has become the number one priority. In order to fully understand this concern, people need to have the right cultural capital: this is the typical target of luxury products that present many highly eco-friendly aspects. These objects are made to endure forever, so time is the essence of luxury.

Localisation is another of the luxury’s key elements: luxury products are made in their countries of origin, with high quality production processes and distribution.

Thirdly, luxury communicates our success, with true gratification derived from our equals understanding how to distinguish the prejudicial success from the socially responsible one.

In the future, therefore, luxury brands will have to worry about redefining their products’ quality, setting new higher standards, to keep their “reputation”. In other words, luxury, to be leader, must be “sustainable”, having to worry too much about the welfare of those who work for them.

Luxury, Art and Charity

Luxury and art have always maintained a close relationship. Today, following in the footsteps of the pioneer Cartier and its Fondation Cartier Pour L’Art Contemporain, all the major luxury groups are promoting through their foundations (Fondation Louis Vuitton in Paris, Fondazione Ferragamo in Florence…), all kinds of arts. Luxury brands are the new “philanthropists”, those who need to sensitise society to the aesthetic values.

Luxury Today and Philanthropy

Luxury Today and Philanthropy – Fondation Cartier America Latina 1960-2013

Luxury also has the duty to redistribute part of its “fortune” (charities and foundations): Gucci presented Chime For Change, a charity project designed by women for women, in support of Education, Health and Justice for every girl, and every women, everywhere.

Luxury Today and Philanthropy

Luxury Today and Philanthropy – Chime for Change founded by Gucci

Luxury has become very generous: perhaps because it wants to fulfil the moral function of the rich?

The views expressed here are the writer’s own and do not necessarily reflect those of The Fashion Globe Magazine.
Alessandra Frega About the author

Lawyer, blogger and aesthete, brings hidden gems and established brands from Italian fashion. With a degree in Law and a Master’s in Diplomatic Studies, her fun loving alter ego has a passion for fashion.

Comments

  1. Thank you for this very insightful article.
    is there any way, I can contact the author of this article? We are launching a high end Art fair to NYC from Brussels and are associating with luxury brands so would love some further feedback. That would be very helpful. thanks, Maria

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