Janus Thinking

TIME Style & Design has just come out with an in-depth report on affluent consumer tastes from around the world. The print edition (unfortunately not available online) delves into the appetites of European shoppers—the Spaniards, Italians, French, British, and Germans—who now are considered some of the wealthiest consumers in the world thanks to a strong euro.

Did you know that Italians own more brands than any of their counterparts and outspend them on watches and jewellery? Or that Spain has the highest percentage of “uber lux” consumers, those with high incomes and luxury-market activity?

It is fascinating to juxtapose the tastes and psychologies of EU neighbours, but TIME adds some more food for thought in its online exploration of luxury in the top emerging economies of China, India, and Russia. What does luxury mean to these three countries who for the first time in decades are finding the economic freedom to afford such indulgences?

For China, who accounts for 12% of global luxury sales, luxury is in demand. Designer watches (66% of affluent consumers bought a watch of an average $2,253 in the last 6 months) are high status symbols, as well as skin-care products. The Chinese consumer will spend up to $280 on a skin-care product, which is almost 3 times as popular as make-up.

In India, the luxury market could grow as much as 25% in the next 3 years. Menswear brands top the most well-known luxury list, which is no surprise as many women still wear saris. Interestingly, local brands, such as Park Avenue, Allen Solly, and Reid & Taylor, also rank high, but considering previous high import taxes, it’s no surprise foreign brands aren’t more prominent yet.

And for Russians, with a heightened sense of brand awareness, flaunting one’s economic status is what luxury is all about. While Russians crave luxury fragrances, it’s jewellery that really whets the appetite: Bulgari, Cartier and Tiffany & Co. top the list of most widely owned brands.

It appears as if there are ripe markets to break into and hungry consumers to feed—something luxury retails are well-ready to capitalize on.

Social networking sites like Facebook and MySpace haven’t traditionally been associated with luxury brands–largely because they’re mainly used by young people who aren’t able to afford expensive luxury goods. However, two complementary factors–increasing numbers of users with discretionary income on the sites and an increasing desire to ‘hook’ young people early on a brand–are changing some luxury brands’ online strategies. Case in point: Cartier. The company recently created a page on MySpace for its new ‘Love by Cartier’ collection. The page, more tastefully done than most user MySpace pages, shows audio, video and photos related to ‘Love by Cartier.’ As of this posting, the campaign has 3929 friends, including celebrities like Lou Reed and Sting.

I wonder about the value of these sorts of pages to the brand. From the IHT:

Ben Hourahine, futures editor at the London branch of the ad agency Leo Burnett, said the use of social networks was appropriate at a time when consumer attitudes about luxury were changing. In a recent survey of U.S. consumers by the agency, only 7 percent said they thought “luxury” meant being part of an exclusive club.

“Luxury brands in the past had this unattainable aspect to them,” he said. “Now they realize they need to connect and communicate with people.”

I’m skeptical because I’m not so sure the MySpace audience matches up well with the Cartier’s target audience. Given the quality of some of the interactions on the page (THX 4 THE FRIENDSHIP!! ALL THE BEST! GREETZ FROM HAMBURG, RALF), I wonder if the positive association these users gain with the brand is worth the tarnishing they’re giving the brand by being so, well, MySpace.