Slate

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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The Greatest Wine on the Planet?

Isaac Mostovicz writes...

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There was a fascinating article on wine published in Slate this week: The Greatest Wine on the Planet: How the ’47 Cheval Blanc, a defective wine from an aberrant year, got so good. It’s about how this particular Bordeaux, through a confluence of controllable and uncontrollable factors, became the Bordeaux against which all other Bordeaux are compared. The author, Mike Steinberger, had the chance to try the ’47 Cheval Blanc at a wine tasting, and described it as

the warmest, richest, most decadent wine I’d ever encountered. Even more striking than its opulence was its freshness. The flavors were redolent of stewed fruits and dead flowers, yet the wine tasted alive; it bristled with energy and purpose.

As one would expect it’s becoming increasingly rare, but it remains at the top of the ‘to-try’ list for many a wine connoisseur. Read the whole article here.

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Counterfeit wines all over the shop

Isaac Mostovicz writes...

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All our recent talk about counterfeit goods lends itself nicely to this discussion of counterfeit wines on Slate.

The article does a nice job of discussing perhaps the largest counterfeit wine story in recent memory, a story involving Thomas Jefferson, forgery, and multiday bacchanals. In 1988 Bill Koch purchased 4 bottles of wine said to be owned by Thomas Jefferson (they were signed Th. J) for $500,000. Two years ago he had the bottles authenticated and found that Jefferson, a meticulous record keeper, had never noted the bottles and that the signatures were forged. Koch is now suing the man who sold him the wine, a German music promoter and wine merchant (best known for his bacchanalic parties) by the name of Hardy Rodenstock.

How widespread are counterfeit wines? Because many vineyards lack proper records about how much wine was produced and where it went, taste can be the best means of authentication. And according to Allen Meadows, a renowned Burgundy critic, about 10% of the pre-1960 wines that he tastes these days are fraudulent. In the article Meadows notes that in some wine circles alleging fraud is becoming a mark of connoisseurship–it “show[s] off their knowledge and the acuity of their palates.” One hopes that aspiring wine connoisseurs aren’t falsely accusing wines that only taste “young” to seem more knowledgeable than than they are.

Read the full article here.

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Diamonds Slated…

Isaac Mostovicz writes...

manacle

This article over at slate is getting a lot of web pick-up.

The story has been blogged by the Captain and Ezra and Constitution Club among many others…

Most commentators seem obsessed with De Beers cartel or by the suggestion that diamonds are not rare- both of which are myths (De Beers has just 40% of the market these days, and the diamond industry spends billions, mostly unsuccessfully trying to find viable diamond deposits).

The other argument, though, is that it’s somehow patronising or sexist to offer and receive a gift as a symbol of commitment…or that a cubic zirconia or manufactured moissanite would do just as well.

The premise of many of these pieces is that somehow social value, emotional value or spiritual value are less meaningful, than something functional. Surely Maslow tells us otherwise!

It’s a naive argument. The question is not whether or not whether De Beers created this market, but whether it is a ‘good’ market for those that choose to participate. Whether diamond engagment rings fulfil a human need – to commit, and to feel a moment of transcendence beyond our own lives…

In short. It is. And they do.

But the luxury in these cases is not the ‘What’ of the diamond, but in the ‘Why’ of engagement. The gift is a symbol is in choosing make a personally costly commitment by giving something eternal, pure, and natural and individual…

If you can find a better symbol which is more ‘Why-level’ luxurious’ for the giver and receiver alike, then go ahead exchange it.

Judah Gutwein says of this article...

Issac,

Great posting!

I too noticed the slate article and feel the same way you do regarding this sham.

I just blogged on this over at http://www.diamondvues.com with some links to your article and your site.

Best Regards,

Judah

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