recession

Lessons from the 1930s Great Depression

Isaac Mostovicz writes that remembering the 1930s may reveal a way out of the recession...

30s

While we’ve looked in many directions for the best ways for companies to respond to (and thrive in) the financial crisis, we have not yet looked to history for a potential solution. How did luxury companies survive the Great Depression of the 1930s? A very interesting piece in Slate’s The Big Money blog tells us that the response then, “the selling of utility over luxury, craftsmanship over status, quality over excess,” is something that luxury marketers today should take to heart.

Utility, craftsmanship and quality are characteristics that trend more towards Lambdas, who seek achievement and uniqueness, but that’s not to say that Thetas (who seek affiliation and control) will appreciate an item less because its flashiness and showiness have been scaled back. Thetas are of course free to use luxury in any way they like, but if it’s to show off in order to fit in, they may find the groups they’re trying to fit into shrinking or less willing to accept them, it being unseemly to be ostentationsly wealthy during the recession.

What kinds of ad campaigns can we expect to match this greater focus on product quality? The article’s author, Karl Taro Greenfeld, suggests a ‘playbook’:

Find your heritage, your traditional values, your long commitment to craft and quality—or make up those attributes if you have to—and then retire the marketing campaign of shirtless models sipping Cristal in the back of a G4, and replace that with an austere, calligraphy typeface of your brand logo and then, below that, something like, “Family Owned Since the Reign of Xerxes.” Or, expect more shots of the product, less of the luxury lifestyle. The goal becomes to communicate the workmanship and quality of that $5,000 handbag, rather than just the buy-in to a cooler class.

This is an interesting observation and I believe we’re already seeing it in the marketing materials of many famous luxury brands. Whether these brands will ‘change back’ to displaying more conspicuous luxury after the recession ends remains to be seen.

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