Major Brazilian and international players from the luxury business gathered for Atualuxo at São Paulo’s Grand Hyatt Hotel to network and talk about the future of the industry. Now in its second year, Atualuxo has already become the main conference on luxury in Latin America and a lighthouse for international brands considering expansion strategies in the region. Organized by MCF Consultoria e Conhecimento—founded by Carlos Ferreirinha to study luxury in Brazil—the conference gathered 30 speakers from distinct segments such as communications, fashion, branding, trend researching, gastronomy and others. The main talk focused on the state of luxury and the challenges it faces during the economic downturn—with a particular eye on Brazil’s position.
Yaffa Assouline, the main director of Assouline Publishing and founder of luxuryculture.com, opened the conference, underlining the idea that the democratization of luxury has threatened its own morals. She described this effect as “demoralizacion,” a stage in which luxury is loosing its spirit, its rules and norms. In fact, the idea was mentioned several times, especially when referring to luxury consumers in developed countries, where luxury is now being embraced more intellectually and emotionally. Because of this, the idea of “going back to the basics,” as mentioned by Jean Baptiste Danet and Manfredi Ricca of Interbrand consulting company, seemed like a strategic path to put luxury back where it belongs: a restricted area in which just a few can enjoy authentic and exclusive experiences. “We need to go from selling more to many for less, to selling more to the few for more,” Ricca argued.
With clients such as BMW, Porsche and Hyatt Hotels and Resorts, Interbrand’s speakers also announced that the era of accessible luxury has ended and a new stage is emerging. The company tagged it as meta-luxury, a new state that embraces the qualities of the luxury brands that are immersed in its own culture. “Luxury in mature economies is increasingly about authenticity, craftsmanship, more knowing than showing, and will not be supported by shareholders, but by owners,” explained Ricca while introducing the six “chromosomes” of meta-luxury: focus, authenticity, longevity, control, uniqueness and discovery.
A similar discourse was taken by IFOP’s trend researcher Stephanie Truchi, who suggested that specialized luxury brands will experience a comeback whenever the luxury market starts to rebuild the distance it used to have from general consumers by focusing on the extremely wealthy. “It’s the seduction by the inaccessibility,” Truchi argued. Real examples of this scenario could be seen with the study case presentations given by French champagne house Perrier Jouet, which develops customized flavors for its very special consumers, or with Pinel et Pinel, a luggage and accessory brand that creates deluxe customized pieces following the desires and needs of each client. Hermés, which recently launched its first store in Brazil, also remains in this elite group, and former director Cristian Blanckaert pointed out that beyond the perfection of the product, it’s also important to offer innovative service and set stores at places that can tell a story. “Today, luxury brands think that they need to be at the most high end avenues to sell. Hermés opened a store distant from the luxurious streets, with a museum inside and its going very well,” he pointed out.
But, how do emerging countries behave with these new luxury concepts? Many speakers used the term “nouveau riche” to refer to the BRIC countries, regions which are undergoing a different transition, one that is arguably more optimistic. Luxury in this case is still experiencing an aspirational stage, in which consumers are very into showing off brands as badges.
In Brazil, according to MFC’s latest research done in partnership with GFK, the majority of luxury consumers are young up-and-comers, who have a distant approach to the luxury universe in which they use high-end labels to affirm status as well as to experiment with such products for the first time. In fact, according to Ferreirinha himself, Brazilian luxury consumers are avid trend followers and their continuous search for new trendy things makes for an unfaithful client base. “Brazilians like to show that they are up to date with the luxury market trends,” he noted. Although, most of the luxury brands and consumers are concentrated in Rio and São Paulo, the research also revealed that Brasilia is the next hot spot where brands should invest.
Clearly, such a paradox in the luxury segment will be another challenge as these brands find a balance between the flourishing market from emerging countries, while also accommodating the “going back to the basics” mindset going on in mature countries. Finding this equilibrium without hurting the brand’s integrity and its product’s authenticity may just be the next matter to solve before we enter another golden age of luxury.