Janus Thinking

Having recently spotted a diamond-encrusted skull (Damien Hirst’s For the Love of God) and a diamond-encrusted Mercedes-Benz (with diamond-encrusted gear shift), this Swarovski crystal-encrusted toilet seems almost common. Almost.

With 50,000 hand-set crystals, it’s one way to bring a little (rather a lot of) sparkle and shine into your bathroom. But the creation, from Jemal Wright’s Isis Collection, “only” costs $75,000. It isn’t as though this thing is covered with diamonds. But what if it were?

Recently Rapaport held an auction of certified diamonds, with prices per diamond ranging from under $4,000 to $12,000. If we to cover such a commode with 50,000 diamonds costing an average of $6,000, we’d have a toilet costing $300 million in diamonds alone. Damien Hirst’s skull only sold (reportedly) for $100 million.

If ‘For the Love of God’ juxtaposes mortality and eternity, what would a diamond-encrusted toilet mean?

[via Born Rich via This Old House]

A mid-century modernist house in the desert of southern California, outside Palm Springs, will go on auction next spring as part of an art auction through Christie’s on postwar and contemporary art.  It has a listing estimate of $15 to $25 million.

As prices in the art market have surged over the last few years, the idea that classic architecture (in this case, a design by Richard Neutra) is a form of high art is creating new opportunities in the luxury art market. 

The home was bought about 15 years ago and had been advertised as a tear-down, according to a recent article in the New York Times.  After an exhaustive restoration, the home now has been restored to its original condition.

The huge range in the pre-sale estimate indicates that certain buyers might be willing to pay much more for a home with such a pedigree and shows the way that luxury retailing is making its way through every sector of the economy.  It also indicates that the preservation of classic architecture might be served well not only by public interest bodies but by private enthusiasts with the money to spend.

With Thanksgiving behind us and the holiday season in full swing, it’s time for the pundits to start guessing whether overall holiday spending will be lavish or more measured given recent difficulties in the mortgage and housing markets. Recent research from Deloitte in the UK suggests that consumers are going to still spend, especially on luxury goods, but may pay for it (metaphorically and actually) in the new year. According to this FT report, in a survey of 1000 adults in the UK, Deloitte found:

• Consumers intend to spend 7% more this year on Christmas gifts, socializing and food and drink than last year.
• 19% of consumers intend to purchase a designer handbag or shoes.
• Price is a less important consideration for shoppers; only 20% of consumers listed price as a main reason for choosing a particular store (it was 37% in 2005 and 23% in 2006); “value for money” also declined.
• 62% of shoppers choose a store based on “convenience” (from 50% in 2005)

Deloitte says this is evidence of our so-called “cash rich, time poor” society, and I have to agree.

But back in the US, willingness to spend might not be as great. Despite reports of decent Black Friday earnings, this week NPR reported that the Consumer Confidence Index dropped to 87.3, down from 95.2 in October and the lowest since October 2005 (following Hurricane Katrina and rising gas and oil prices).

Rosalind Wells, chief economist for the National Retail Foundation, said:

With the weak housing market and current credit crunch, consumers will be forced to be more prudent with their holiday spending.

Even with the credit crunch, I’m not so sure people will actually be more prudent–if they have a line of credit they’ll use it to purchase expensive gifts they don’t see as optional.

We’ve seen it in cars and resorts; now ethical, sustainable luxury is playing a larger role in other aspects of peoples’ luxury consumption (according to this article in the International Herald Tribune from this past weekend). Ethical living has hit the media, through film (An Inconvenient Truth, Blood Diamond) and and in print (in glossy magazines like Vanity Fair and Vogue), and people are generally becoming more aware and more willing to spend on ethically produced products. Milton Pedraza from the Luxury Institute of New York said:

Our research shows that if wealthy consumers know that a luxury brand is socially responsible they will give that brand greater purchase consideration over a brand with similar quality and service.

Of course there is a worry for luxury brands that becoming sustainable and ethical will take away some of the aloofness and elitism that give them cachet, but if the move towards green living continues, companies will have no choice but become more accountable and transparent.

Knowing the provenance of an ethically-sourced item gives people something to talk about and makes them more involved in their luxury. So says Vivien Johnston, the founder of Fifi Bijoux, a British-based ethical jewelry company:

One of the key luxury elements is knowledge of provenance. It’s the value that really separates you. With Fair Trade, it’s not just a diamond: I can show you pictures of the miners, the mountains, the cooperative projects and the people that produced it, that’s a real element that you don’t get from most products and I think that people appreciate the story.

Whether ethical luxury is a fad that will pass or a truly revolutionary step for the market remains to be seen, but for now I don’t see any luxury companies becoming less green.

The Robb Report, the monthly magazine and website about luxury goods and experiences, has just announced its annual holiday gift guide. While I haven’t been able to find the full ‘Ultimate Gifts’ section online, the Wall Street Journal Wealth blog has had a look and noted a few highlights, including a $250 million yacht (with 13 suites and two helipads) and $16 Ferrari package (with a F1 Ferrari, 2 VIP passes to all 20 Formula One races next season, and lunch with Ferrari personalities).

These are not the only luxury items the Robb Report has recently promoted–earlier this month they began offering the Robb Report Limited Edition Series from their website’s Marketplace section. It’s an elite offering, including a car (a bespoke commissioned Rolls Royce Phantom for $493,272.00), wines (Ultimate Burgundy or Definitive Bordeaux from the Terroir Company, $1 million each), jewelry (Beaudry diamond and platinum bespoke ring, bracelet and earrings), and travel (golf, shopping and winter sports trips with a Sentient Jet membership $195,000-475,000) among other offerings.

Does the fact that the Robb Report is offering such luxury directly (in addition to highlighting items in guides) suggest that demand exists and that the economy isn’t doing as badly as we might think? Are they (cynically) in it for the high margins luxury products often offer, or do they really want to bring their readers the very best luxury they can find? The answer is probably somewhere in between.

Hot on the heels of The Economist’s foray into a luxury quarterly magazine (Intelligent Life), the Times of London has this month introduced Luxx, a quarterly lifestyle magazine “dedicated to luxury and all the best things in life.” They’ve put a very nice online version up on their website, and paging through it I’ve noticed several topics we’ve mentioned on Janus Thinking, including how luxury is increasingly about personal pleasures rather than brand names (in the letter from editor Tina Gaudoin) and a piece on handbags with a great quote from Sean Pillot de Chenecey of research and brand development consultancy Captain Crikey:

Luxury has moved from being a niche-to-niche market, where craftspeople produce small numbers of bespoke items for a select audience, to one where luxury products are mass-produced for the new legions of super-rich… [The luxury bubble could burst for] those brands that become tainted by association with the wrong sort of consumer.”

Other articles range from the somewhat serious (a profile of Tiffany designer Paloma Picasso) to the somewhat ridiculous (How to buy a tiara)–all in all it’s an interesting read. You can check it out here.

Today marks the UK launch of Apple’s iPhone on the O2 network. Already a pricey proposition (with a £269 ($564) pricetag and minimum contract for £35 ($73) a month), those who want something to differentiate themselves from the masses sure to pick up iPhones today need not look further than London luxury retailer Selfridge’s.

The department store is offering a whole range of upscale ‘blinged’ versions of phones, including the iPhone, with options for exteriors in steel, 18 carat gold, or 18 carat rose gold, with or without diamond encrusting. The phones are offered through a partnership with Amosu–currently the pricest on offer is a diamond-encrusted Nokia N95 for £12,000 ($25,180). Earlier this week there was a diamond-encrusted iPhone for £20,000 ($41,968), but it seems to have sold out.

Selfridge’s has also partnered with several designers to create holding cases by the designers Christian Louboutin, Chloe, and Burberry. 

The rise of luxury phones (see also the Vertu mobile phone series) shows how they have become an integral way in which consumers represent themselves.  Less a form of technology, more a fashionable accessory…

The Cult of the Luxury Brand: Inside Asia’s Love Affair with Luxury – published earlier this year by Radha Chadha and Paul Husband – looks at how Western brand retailers are increasingly meeting their bottom line by marketing to Asian consumers.

The authors cite the fact that over half of the revenues brought in by Western luxury brand retailers comes from Asia.  Japan’s market is the biggest, but the authors show how China’s and India’s markets are propelling this trend forward.  

Among other topics, the book shows how fickle luxury trends can be, and traces the history of luxury fashion over the last century.  Around the turn of the century, during the Belle Epoque, most sales came from a small elite of European upper classes.  A handful of Asian cities such as Tokyo, Shanghai, and Hong Kong, took part as well, only to disappear again after Japan’s losses sustained during the second World War, with the austerity introduced by China’s communist regime, and the nationalistic tendencies of a newly independent India.

This book also shows how luxury retailers have gone about democratising the must-have luxury fashions which middle-class housewives, schoolgirls, and mistresses swoon over today across Asia.  It also looks at how these trends will continue to evolve in the future.

Businessman Bernie Ecclestone apparently has too many classic cars for his liking.  Last week the Guardian reported how the President and CEO of Formula One held “the billionaire’s version of a spring clean” by selling off 50 cars in his private collection, many of which he has never driven.

The highlight of the show was Ecclestone’s 1937 Mercedes Benz 540K Spezial Roadster, which sold for £3.85 million ($8 million).

Simply touring the auction became an event in and out itself as visitors paid £50 yesterday just to gain admission to view the cars themselves.  One visitor, as reported by the Guardian, visited as much to ogle other visitors as to appreciate the cars themselves:

We have more money than we know what to do with, so we thought we’d come here.  And we wanted to see what greed looks like.

The full takings of the sale have not been released, but not all the cars went for millions or hundreds of thousands of pounds–a 1964 Ford Anglia Deluxe Saloon went for £5,588.

A French artist named Dogmael Damien has set up his own website targeting billionaires in search of their next big acquisition, a recent Art Newspaper article reports.  The artist’s site is now online and markets itself as “Paintings for Billionaires Only”.  Each of the three paintings currently on the site can be had for only €150 million (and without any commission!).

None of the paintings has sold as of yet, but Damien has held firm to his concept.  He writes further on the site:

The acquisition of these paintings will cause a shock in the Art World, not only for the spectacular stunning massive price paid for it, but also for the private way it will be sold, far away from the noisy auction places. 

This private sale would have made these paintings the world’s most expensive ever sold in art history. The Most expensive Living Artist.

The recent boom in art sales has seen works of art selling for well beyond their list prices at art fairs or presale estimates at auctions.  A Russian billionaire businessman named Alisher Usmanov recently bought 450 lots outright before the start of a Sotheby’s sale in October for “substantially above” the initial expectations of the sale.