BRAND JUNKIES: The True Cost of Luxury Goods
The Cult of the Luxury Brand: Inside Asia’s Love Affair with Luxury by Paul Husband and Radha Chadha
From THAT'S SHANGHAI December 2006 Print & Web Edition
By Mina Choi
Why are office girls in Shanghai willing to sacrifice two months salary
for a Gucci bag? Why do 94 per cent of twenty-something women in Tokyo
carry Louis Vuitton bags? And why are some Asian girls financing their
brand-name shopping sprees by prostituting themselves?
The answer to these and other similarly burning questions are addressed
in The Cult of the Luxury Brand: Inside Asia’s Love Affair
with Luxury authored by marketing and consumer gurus, Paul Husband
and Radha Chadha. Backed by reams of statistics, and a plethora of case
studies, the writers offer a compelling portrait of Asian consumers
which constitute the world’s largest market for Western luxury
Ambitious in its scope, the book features substantial sections on China and India – two developing nations – where the near-insatiable craving for luxury goods is expected to overtake more developed countries in the region in the near future. Already, more than 70 per cent of the luxury goods sold in Hong Kong are purchased by consumer from the Chinese mainland.
But there’s more to this book than numbers. Chadha and Husband offer sociological observations on the luxury consumer craze, and advice on how to exploit. Beginning with a brief history of luxury brands, the authors move on to document sales trends, focusing on how in the last two decades luxury products have shifted from their original target demographic – the very rich – to that of the middle class. Which in marketing terms, is a very smart move.
With annual global sales of USD 80 billion, the luxury brand business
has become an economic force unto itself. With Louis Vuitton at the
top of the stack. Says Chadha: "LV is number one in sales internationally
because they have cleverly written the rule book. To be a successful
marketer, one must know how to write the rule book."
Which is a lesson the author themselves have failed to observe. Indeed,
The Cult of the Luxury Brand appears to break many of the rules
of good writing. As mentioned above, the authors’ sharp social
commentaries are interspersed with earnest statistics. Commentaries
such as “Luxury hasn’t just been democratized, it has become
inescapable,” go hand-in-hand with charts that show the five stages
of luxury product consumption. According this chart, China is currently
at Stage 3 – the “Show Off” stage – whereas
Japan has entered the most developed stages – Stages 4 and 5,
the “Fit-In” and “Way of Life” stages.
In the opinion of Radha and Husband, Asia’s collective mentality
has created a very receptive market for the penetration of luxury brands.
Asians, say the authors, want the same brand and the same bag, precisely
because everyone else knows exactly how much it costs.
The book singles out China as the ideal market for luxury goods manufacturers.
Why? Well, because social and cultural peculiarities such as guanxi
and mianzi create a perfect environment for the acquisition of status
symbols. "It's all new money in Asia,” says Chadha, “and
that means high price equals luxury. Asians need a modern set of symbols
to define who they are. Which means you are what you wear."
Of course, not everyone in China, or for that matter elsewhere in Asia,
buys the real thing. And so the book devotes space to the issue of fake
goods and their negative and positive effects on the market. Says Chadha:
“Fakes often are starter kits. People start with fakes, then move
onto authentic products. But once they go authentic, they never go fake
Filled with anecdotes concerning Asia’s rich and poor, the book
illustrates how the social pressure to fit in and show-off brings has
affected the market for luxury goods – and the oh-so-terrible
consequences. For example, the epidemic of “credit-card suicides”
in South Korea, where young people in their 20s and 30s, who have overspent
on a luxury lifestyle, resort to suicide to escape their debts. In the
end, the inclusion of such morbid statistics, juxtaposed with how-to-sell
advice, such as “Go to Where the Money Is, Never Mind the Sophistication
Level,” leaves a bad taste in the reader’s mouth.
When asked for her personal view on Asia’s supposed obsession
with brand name goods, Chadha breezily answered: “It’s great
if it helps you lift your self-esteem, but not if you have to go to
extremes to get those items.”
Paul Husband and Radha Chadha spoke at the Glamour Bar in November. The Cult of the Luxury Brand: Inside Asia’s Love Affair with Luxury, Radha Chadha and Paul Husband is available at Chaterhouse Booktrader, Times Square, B1-K 93 Huaihai Zhong Lu, Puxi; or Super Brand Mall, 168 Lujiazui Xi Lu, Pudong.
For a complete list of Articles on Books by Mina Choi click HERE