JENNY WORNER ON THE RESTLESS PURSUIT OF META-LUXURY, WHERE ‘BEING’ IS THE NEW ‘HAVING’
WORDS BY JENNY WORNER
In a move beyond the seemingly endless debates about the actual meaning of the term ‘luxury’, Ricca and Robins (2012) coined the term meta-luxury. Meta-luxury is about luxury beyond luxury – the culture of excellence.
“‘Luxury’ is often a self-proclaimed status; meta-luxury is always a restless pursuit. ‘Luxury’ is about showing; meta-luxury is always about knowing. ‘Luxury’ is often about stretch and surface; meta-luxury is always about focus and depth. ‘Luxury’ is sometimes about ostentation, meta-luxury always about discovery. ‘Luxury’ is often merely about affording; meta-luxury is first and foremost about understanding”.
The cultural significance of unique achievement is embodied in a well-defined business model. Several features define the economics of meta-luxury:
“‘Luxury’ is about showing; meta-luxury is always about knowing.”
Sustainability, not profitability defines meta-luxury. A requisite and consequence of the enterprise’s mission is economic success, but the primary objective is sustainability. The quest for unique achievement is pursued fiercely at an ownership and management level. The question is not about cost, but on how it will make things better. Demand will never justify breaking through the threshold of sustainability.
A Balance Sheet approach, as against a Profit and Loss approach will drive the meta-luxury business model. Revenues, costs and profits are central performance indicators and record the activity of the enterprise. However, central to these activities is the duty of constructing and nurturing an asset that produces substantial value over time. The asset is the brand, and the brand asset drives profit. It is thus the brand that drives the business – not the business the brand. The uniqueness of the brand creates and secures demand and ultimately generates revenues and profit. This lies in stark contrast to those models where the asset is endangered due to placing priority on revenues and profit. The concentration on the prosperity and value generation of an asset over time is more compatible with a private or family business, some of which have existed for centuries. Less than two decades ago, single-brand family owned companies accounted for more than 50 percent of personal luxury goods revenue. Currently the industry is dominated by publicly owned, multi-brand groups.
“Sustainability, not profitability, defines meta-luxury.”
Meta-brands create a virtual monopoly. A company’s history, its consistently focused skills and unique offering fuse into a brand that is difficult to imitate.
The long-term growth of meta-luxury is provided by limitation, not expansion. From an economic perspective, the drivers of meta-luxury represent deliberate self-limitation. Craftsmanship leads to reduced productivity and output. Rarity is about selling less to preserve the qualitative integrity and desirability of the brand to those seeking a product with individual meaning. Focus is about doing fewer things in the pursuit of excellence. Competing on a basis where the drivers are self-limiting would appear counter-intuitive. However, the bedrock of meta-luxury is a culture of excellence. This is driven by qualitative achievement, not economic outcomes. Sustainability triumphs over profitability.
Meta-luxury is about effectiveness, not efficiency. Trying to achieve the absolute best rather than trying to do more with less permeates every aspect of the company from design to supply chain, production and distribution. An increase in efficiency should never correspond with a concomitant decrease in quality. Efficiency should only follow effectiveness.
“The commitment to excellence of the meta-luxury brand rests strongly within a culture of bold innovation and constant improvement.”
The focus of meta-luxury is about mitigating risk rather than maximising returns. Democratisation of a brand in order to expand a customer base will dilute the brand’s rarity and focus as well as its desirability to a certain audience. In order to preserve the value of a long-term asset, it is imperative to pursue the mitigation of risk. It is imperative to strike the ideal point between risk and return as the meta-luxury brand can lose far more than it stands to gain when pursuing profit.
Mitigating risk should not be mistaken for inertia and inactivity. The commitment to excellence of the meta-luxury brand rests strongly within a culture of bold innovation and constant improvement. The reduction of risk is simply about the uncompromising pursuit of excellence.
“The discerning traveller is seeking an experience that creates a shift in their being; as luxury has moved from ‘having’ to ‘being’.”
The discerning traveller is seeking an experience that creates a shift in their being; as luxury has moved from ‘having’ to ‘being’. This relentless quest may find its true expression in those destinations which base their business model upon the uncompromising economics of meta-luxury.
Jenny Worner recently completed an MBA, writing a thesis entitled ‘Luxury beyond luxury – understanding the nature and processes of customer value in ultra-luxury travel’. She is now researching for a DBA focussing on luxury tourism, with the aim of adding value to the industry. If you’d like to find out more, contact [email protected]