Worldwid luxury goods are booming and predicted to keep on growing, but the history of luxury shows us just how much the concept of luxury has - and is - changing.
In Abu Dhabi's Emirates Palace Hotel it's not only cash that people want to get their hands on quickly; they have a machine dispensing gold bars. Just in case you don't have any easily at hand to buy that Bentley.
Luxury is big business and it's not only among a wealthy few. The luxury goods market is expanding worldwide and is expected to rise by 8% and be worth a cool £164bn by the end of this year.
China is the nexus. There are now around 500,000 millionaires in the country and the Chinese buy 12% of all luxury goods in the world, according to Barclays Capital. By 2020 it's predicted to be the world's largest luxury goods market and account for 44% of all sales. By then the Chinese will be buying more luxury products than the entire world is now.
Rarity has always defined luxury,
says historian Dr Michael Scott. It means things like gold will always be sought after, but in ancient Greece it also meant a luxury envied and aspired to was meat. For thousands of years the main human diet was made up of fruits, cereals and vegetables and meat was a rarity.
Expensive fish were viewed as "luxury goods" in ancient Greece.[…] In democratic Athens in the 5th Century BC everyone knew how much it cost and that made it the ultimate "luxurious consumption”. […]
Extravagance and Lust
In Britain in the Middle Ages spices were a luxury. They were expensive because they were shipped in from the East via new trade routes, along with fine cheeses and wines from the rest of Europe. The church believed indulging in these items was a sin and introduced days of fasting to limit the eating of such foods. They also made the link between eating spices and "exotic" behaviour.
"When modern English first emerged in the late Middle Ages luxury did not mean excess or extravagance but lust,” says Dr Scott. This is because luxury was, and still is, about "stimulating the senses", says Prof Miri Rubin from the University of London. "There are very ancient theories about how sense, body and the mind operates so being around beautiful things hearing, touching, tasting and so on all this has to do with your state of mind,” she says in her book, Speaking in Luxury In The Middle Ages. "So luxury and sexual wiles are all bound up very powerfully."
The luxury brands of today came out of the time of austerity in the 1920s, when people returned to basic bespoke products. With not much money around, people wanted things to last.
Craftsmanship and heritage became important and still are today.
After World War II prosperity flourished in the UK, but while the expanding middle classes wanted luxury they could not afford high-end items. Companies came up with a new set of smaller products including handbags, scarves, wallets and purses. The concept was about offering "accessible luxury" and it was a concept consumers embraced. Now 90% of women in Japan have a Louis Vuitton handbag.
It is described as the
"democratisation of luxury goods”
- opening up the luxury market to the upper end of the mass market, says analysts Mintel. This has helped not only fuel the boom in the luxury market at the "accessible" end but also at the high end, with the rich demanding more and companies coming up with ever more extreme items. […]
In 1348 the Black Death hit Britain and almost half the population died. This meant the people who survived had a larger share of the wealth. The lower classes were better off so they could copy the rich, by dressing in a similar fashion, copying their pointy shoes and leather sword sheaths and wearing fur. The elite were distressed that you could no longer tell the rich from the lower classes. In 1363 The Act of Apparell was introduced by Parliament. It specified what every class of citizen could wear and even what food they could eat.
So what luxuries will people be stimulating their senses with in 10 years' time?
Experts predict the market will be fuelled by consumers’ "emotional connections", says Lucia Van Der Post, luxury lifestyle commentator and former editor of How to Spend It magazine. In a speech to the Champagne Assembly, which is made up of champagne producers, she said luxury has evolved from the expensive trinkets and toys of yesteryear, to meaningful experiences with a genuine emotional dimension.
"The traditions of old luxury - the luxury of things - are awfully dull for new consumers. They want to be touched emotionally by their experiences, and there are new priorities, such as ethical concerns and sustainability.
Luxury lifestyle company Quintessentially is seeing this change. People want unique experiences to savour and remember, says co-founder Aaron Simpson. "These have included closing the Sydney Harbour bridge in Australia, so a client could climb up and propose to his girlfriend. Luckily she said yes.” And Asia will be a major force in the market. It has now surpassed Europe's numbers of millionaires for the first time, with 3.3 million. These millionaires have a joint wealth of £6.7 trillion ($10.8 trillion), according to the latest world wealth report from Merrill Lynch and Capgemini.