« If by luxury we mean everything beyond what is necessary, luxury is a natural consequence of the progress of the human species; and to reason accordingly, any enemy of luxury must believe with Rousseau that the state of happiness and virtue for man is that, not of wilderness but of orangutan. We feel that it would be absurd to regard as an evil the conveniences that all men would enjoy: therefore the name luxury is generally given only to the superfluities that only a small number of individuals can enjoy. In this sense, luxury is a necessary consequence of property, without which no society can survive, and of a great inequality between fortunes, which is the consequence, not of the right to property, but of bad laws. »
Voltaire

Introduction

1How to introduce luxury without mentioning a series of brands: Louis Vuitton, Ferrari, Chanel, Dior, Giorgio Armani, Mercedes-Benz, Prada, Hermès… So many world-renowned brands – among others – that make up the luxury universe; without forgetting the most discreet ones, reserved for insiders, such as Joël Arthur Rosenthal, Mozer or Herend. Another classic entry to open the reflection on luxury, a brief overview of the various media that illustrates the interest in luxury and its resonance with the general public: “a glimmer on the luxury real estate market in Paris”, “the presentation of a collection of luxury whisky”, “a holiday in good company on a luxury yacht”, a “radiant spokesmodel to promote the Bvlgari brand”, without forgetting the field of sport with the “luxury offensive casting of the Real” and “Avinton, a Gardois luxury thoroughbred”.

2These uses of the word “luxury” cover heterogeneous realities that overlap on some singular dimensions: real estate, a holiday on a yacht, a collection of whisky or football players. All these titles introduce luxury into its expensive dimension, of specific financial values; luxury is also associated with the notion of refined goods (the whiskies of the Dalmore distillery in partnership with Harrods) and limited like the “Avinton motorcycle”. Expensive, exclusive, refined, rare, sumptuous, ostentatious …, the understanding of this concept of luxury is delicate as the economic and societal stakes that crystallise there interfere in its interpretation. As Lipovetsky (2003) summarises, “consuming luxury is consuming a product, a legend/myth, a tradition, a know-how and a rite at the same time”.

3The contours of luxury are drawn at the crossroads of disciplines: from philosophy to sociology, from psychology to economics. The intersection of these approaches makes it possible to identify the main characteristics, components, objects, practices and to take the political measure of luxury. The production and consumption of luxury goods are part of “complex political and cultural matrices that give consumer acts their specific resonance and meaning” (Brewer and Trentman, cited by Bauman, 2008: 36).

1. The foundations of luxury

4Luxury first characterises a deviation from the norm in a given society at a given time. Today’s luxury goods in hyper-materialistic Western societies are no longer the same as they were two decades ago. But luxury remains the privilege of a wealthy elite who oppose the “mass”. The terms “elegance”, “refinement”, “beauty” can be used as well as “exclusive”, “restrictive access” for “rare goods” highly “coveted”. In the wake of luxury, high-end products are spreading to the next ones – the followers – individuals who, driven by the rise in living standards and the abundance of goods in hyperconsumer societies, can claim more refined, above-standard goods that lend themselves to increasing personalisation. Gilles Lipovetsky (2003) underlines the universality of the phenomenon, which is not “the characteristic of developed societies”.

5Our contemporary conception of luxury is essentially focused on its materialistic dimension, where luxury fulfils an honorary, prestigious and statutory construction function. This is a historical reduction in the function of luxury, which was both honorary (it allowed the chief to establish his place in society) and sacred. This second dimension, which combined luxury with the invisible forces of the sacred, particularly in the context of sumptuary celebrations, has fallen into disuse (Malinowski cited by Lipovetsky, 2003; Mauss, 1924-1924; Castarède, 2007, 2010). The concept of luxury is now limited to its materialistic and honorary dimension; having and appearing are essential, others ’gaze is fundamental.

1.1. Luxury as an ostentatious consumption

6In the theory of the leisure class, T. Veblen lays the foundations of conspicuous consumption. At the beginning of the 20th century, the “leisure class” was understood as the wealthy elites who lived off income and various investments. Not subject to laborious tasks, they have the privilege of having abundant unproductive time and being able to “waste” their money at leisure. The power of wealth is displayed through conspicuous consumption, beyond need, “by distance from utility” (Bourdieu, 1979). The “pecuniary rivalry” begins by becoming part of the institution of private property within the “idle” class. Veblen emphasises that one of the “most indelible features of human nature” is the desire “of each person to prevail over others”, a desire that feeds a “provocative distinction” designed to gather the esteem of others (Veblen, 1899 : 12).

7Veblen lays the foundations for luxury and luxurious leisure: the “provocative distinction” shows the waste of time and money, wealth and power. The consumption of these singular objects – which forge contemporary luxury – does not correspond to any direct utility, but rather to a secondary or indirect utility that Veblen also describes as “social utility”. Beyond these characteristics and its “displayed beauty”, it is, first of all, an honorary object that stands out for its high price, where the signs of high price are accepted as elements of beauty. They flatter the eye mentioning high prices and honour. And this gradual habituation leads to associating the signs of cost with the identification of beauty and honorability as well as subsequently, by considering that something that does not cost much cannot be considered beautiful.
This social game, between “conspicuous consumption” and “provocative distinction”, invents a new utility to the object unrelated to the value of its direct use; it is the indirect utility, the honorary utility: “utility over - classifying”. The contemporary foundations of luxury take their origin in this ostentatious desire for consumption, with the public display of wealth, with noble objects (jewellery, metals, precious products that stand the test of time) that “did not oxidise any more than they lost their brilliance because they stood the test of time; its qualities made them symbols of permanence and constant reliability”. They embodied the success of the “strong modern society of producers” (Bauman, 2008 : 46).

1.2. Distinction, transubstantiation and sensualism

8Bourdieu’s theory of distinction is an extension of Veblen’s notions of “conspicuous consumption”, “ostentatious waste” and “provocative distinction”. In Veblen’s approach, the value of the luxurious property lies essentially in its material, tangible characteristics. In the second half of the 20th century, Bourdieu focused on analysing the mechanisms of the symbolic construction of the value of the object and in particular of luxury goods.

9A shift is taking place: from pecuniary wealth to “aesthetic disposition”, with value judgments, tastes shaped by culture and habits built on wealth accumulated over several generations. The value of the luxury object is no longer based solely on its material richness (the result of the value of the material and the volume of working hours involved in the object), but also on an “aesthetic disposition”, the “sense of distinction”. The specific manufacturing methods limit the quantity and impose longer manufacturing times; the financial value linked to the rarity of the good is multiplied by its social aura. Access to these goods grants a social distinction: in a consumer society, the individual, his/her belonging to a group, a certain social category, his/her “representation”, are materialised by objects (purchased, appropriated, consumed) that participate in the construction of identity, the public expression of the “self”: the ”simulacrum” (Baudrillard, 1968).

10The symbolic construction process of this idle classes ’aesthetic distinction gives the so-called luxurious object a social dimension that may not be in adequacy with the value of its real material components (Pastel, 2012: 37). In this symbolic dimension of the luxurious object, there is a process of erasing the materiality of products that disappears as “object-thing” to exist as “object-sign” (Pastel, 2012: 37). Bourdieu introduces here the concept of “transubstantiation”: this operation which makes it possible to produce symbolic goods (in particular in the field of luxury, culture, fashion and the arts) whose entire quality is of a distinctive nature. This process gives the object a distinctive social quality without transforming its physical nature.

11Symbolic transubstantiation is the rule in the field of luxury: the “ordinary” product becomes a “luxury object”. “The label constitutes a brand that changes not the material nature, but the social nature of the object” (Bourdieu, quoted in Pastel, 2012: 33) and, inevitably, this transubstantiation impacts the economic value of the object whose price is increases tenfold.

12Lipovetsky and Roux (2003) open the reflection on the complexification of relationships to luxury in the contemporary context, that of the age of the individualisation of luxury in our “hyperconsumer society”. These consumptions must now be interpreted in three dimensions: qualitative, ostentatious and emotional. The ostentatious logic being one of these facets, not exclusive, whose primacy will have to be reconsidered according to the cases studied. Lipovetsky insists on the quest for quality of life and the “aestheticisation of consumer behaviour”. We must integrate the narcissistic relationship, the fundamental dimension of “indulging oneself”. “The jouissance is interior and it is the great turn of hypermodernity”. Consumers privilege “the emotional, experiential, sensual” aspect and “the distinction is then more narcissistic than social”.

13The universe of luxury has long functioned on the basis of an “aristocratic and artisanal model” whose old barriers to individualism (family, traditions, religion) have fallen in favour of an unbridled hyperindividualism whose shift gradually took place at the end of the 19th century with the advent of the industrial era. The “age of hyperindividualism” is characterised by hyperconsumerism, where luxurious consumption primarily consecrates a “quest for the sensory, for more or less exceptional experiential and aesthetic pleasures” (Lipovetsky, 2003). The central role of the conspicuous dimension posed in Veblen’s theory fades in hypermodernity, but it always remains implicit in the consumption of “hyperindividualism”. Lipovetsky insists on this “inflection” that must be made to the theories of conspicuous consumption and the distinction of Weber and Bourdieu.

14The tastes for luxury are therefore three-dimensional: first, the fetishism of the object (e.g. leather bags, shoes, refined perfumes); second, the social distinction with conspicuous consumption (the pleasure of enjoying a product at a discriminatory price); third, emotional elective situations (e.g. the discovery of Polynesia aboard the Paul Gauguin boat).

15Luxury is opposed to mass, to mass production. “Luxury is neither random nor contingent” (Lipovetsky, 2003), it materialises an object, a service, a behaviour that deviates from the average, from the norm of the moment, inaccessible to the greatest number. This gap highlights the inequality among men, “it is the transcription of the hierarchy between the nobles and the peasants”. As Max Weber has shown (quoted by Lipovetsky, 2003), “luxury is then the correlate of the unequal organisation of society”; hence its universal dimension, where ostentatious expenses compete with prestige and overbidding in the current economic downturn.

16Luxury is money and signs of monetary wealth. Luxury emphasises social stratification: luxury transforms money into a sophisticated cultural product. Money makes it possible to elect the rare object, to possess the coveted rarity, to transform it into an inaccessible object. The owner of such an object is therefore “someone special” who stands out socially. Luxury is constantly built and renewed according to the “opening/closing” principle, i.e. everyone must (re) know it, but not everyone can access it (Bastien and Kapferer, 2008).

2. The contours of luxury

17Luxury means superior quality; it has distinctive features: “luxury to show” (ostentatious), “luxury to live” (emotion and sensualism), “discreet luxury” (subtle distinction) (Dehoorne, 2012). Luxury is made to distinguish itself by the value of the objects consumed, which should not be confused with the overconsumption of objects. Luxury is associated with “material, symbolic and social excellence” (Karpik, 2007 : 196).

18Luxury is part of a historical construction, with historical buildings such as the crystal factory of Saint-Louis, the former royal glass factory of Saint-Louis which pierced the secret of crystal (1781). Over time, the legends that nourish these objects invested with culture are written and rewritten and the magnificence of brands such as Guerlain (cosmetics, 1828), Lancôme (1935), Cartier (1847), Bugatti (1909)… Luxury is based on the “tradition” of a unique know-how, the “creation” of finished objects, the excellence of their design “with exquisite finishes”; results of the time invested in the manufacturing process and the expertise mobilised by the project.

19Refinement, inner quests or distinction, pleasure of creativity and innovation, luxury is a composite, tangible and intangible whole, which combines an object (or a service) and rewarding representations, with codes and a vision that give a feeling of exception and are established as an “art of living”.

20A certain confusion is spreading around the luxury sector – very promising economically – in the face of the multitude of self-proclaimed “luxury” products, with a lot of publicity advertising, depending on the media coverage with the display of the celebrity of the moment. The difficulty therefore lies in the timely use of this term to describe different realities that do not have the same values. There is a mix of genres here. First of all, it should be stressed that luxury is limited by its very nature. Consequently, the democratisation of luxury is a fallacy (Carron, 2006). The democratisation of luxury would mean its disappearance. If owning a car at the beginning of the 20th century was a luxury, today, cars have become a common consumption. But luxury remains in the automotive sector through some prestigious brands, such as Aston Martin, Bentley, Morgan.

21A distinction must therefore be made between elitist luxury – based on limited series – on the one hand, and products from accessible, low-quality luxury, which are part of industrial production intended for the high-end market and occasional buyers, on the other hand. This discernment extends to the different ranges and types of products, including within a brand that is renowned in the world of luxury: for example, when it launches into mass production, playing on the reputation of its “label”, as part of a massive commercial strategy that goes beyond the field of luxury. The purchase of such objects, produced in series, is a “prestige” acquisition for many consumers, on a one-off basis, without making these customers customary luxury consumers. They will not be able to buy a haute couture dress created in a Pierre Cardin workshop in Paris. On the other hand, they will be able to buy modest objects from well-known brands (such as Pierre Cardin ballpoint pens).

22Serial products – even expensive ones – are at best top-of-the-range and lend themselves to one-off or exceptional purchases by the average consumer; conversely, “exceptional luxury” has an elitist dimension, belonging to another class – a kind of life in its own right – and whose entry-level price can quickly be counted in years of salary for a middle manager. It should be recalled that the financial value of the luxury item is unrelated to its utility and functional characteristics.

23Luxury contributes to consumer differentiation and social elevation: the symbolic contribution of a branded bag “must” pull the consumer out of his own social condition and enhance him in the eyes of others. This “prestige” acquisition, which is a one-off acquisition, is part of the top-of-the-range category. In fact, the mass production of such an object (at a price close to 1,000 euros) is not exceptional, unique or singular. On the other hand, when the same brand makes custom trunks for Keith Richards – the Rolling Stones guitarist – it is “exceptional luxury”.

24During his hunting trip, Corey Knowlton was accompanied by Namibian government guides who had to make sure that the slaughtered animal was the right one, as well as a television crew from the American channel CNN. The man had won the right to kill his black rhino at a highly controversial auction in Dallas in 2014, which provoked the fury of animal welfare groups.”

25Excerpt from the article “350,000 dollars, the price to pay to kill a very rare rhino” Le Figaro, 20 May 2015

3. Luxury and the economy of singularities

3.1. Luxury and the “judgment market ‘

26Karpik’s (2007) distinction between the ‘price market’ on the one hand and the ‘judgment market’ on the other hand opens up the debate on the luxury economy. The ‘price market’ refers to the market of homogeneous products, familiar, known to consumers, with identified properties. These products do not require a specific qualitative evaluation. Homogeneous, standardised, they respond to defined functions that are in line with direct utility. Their price is based on an adjustment of supply and demand. This is the field of the mass consumption market with the consumption of common objects. At the same time, there is the ‘judgment market’ where the objects marketed have specific qualities. It is a ‘quality economy’ with the exchange of objects described as ‘singularities’, where ‘judging devices’ are a means of adjusting supply and demand. A trusted network attests to the quality of the object. Luxury is part of this economy of singularities.

27The dominant neoclassical market theory remains valid for goods without specific qualities, standard goods. But in the case of ‘judgment market’, these are singularities, non-homogeneous goods. The originality of the offer and the personalisation of the service ‘are opposed to interchangeability; singularity is opposed to massification’ (Karpik, 2007: 38). The loss of symbolic quality means the transformation of originality into uniformity. There is then ‘desingularisation’ ‘when the singular product is converted into undifferentiated products’. The market distinguishes singular products that belong to the ‘judgment market’, then declined products and products that are in the process of becoming commonplace that belong to the mass market, the ‘price market’. (Karpik, 2007 : 38).

3.2. The monetary value of property

28From a strictly economic point of view, the monetary value of property is the main measurable, objective indicator that makes it possible to distinguish the luxury market from the non-luxury market and to prioritise the ranges of goods (see Figure 1). If, as Bastien and Kapferer (2008) like to point out, the luxury object is ‘an ordinary object for extraordinary people, but also an extraordinary object for ordinary people’, its price is discriminatory, as shown by the multiplying coefficients noted by Eurostaf (2004).

29The luxury good costs on average twenty-two times the price of the entry-level basic good, i.e. the product that meets the simple utility required. The multiplier coefficient is eleven for an average product. The gap is still significant between high-end and luxury, which costs on average four times more expensive; this means that when the average price of a high-end hotel room is around 400 euros, that of a room in a luxury hotel starts at 1,600 euros.

30Hence the paradox of luxury goods that are part of the ‘judgment market’: the higher the price, the more they attract demand. This paradox is called the ‘Veblen effect’ or snobbery effect (see Figure 2). It is different from the classic general equilibrium model of supply and demand: if the price of the good under consideration falls, it loses the interest of wealthy customers. When its value declines: it falls from luxury to high-end and can fall further. This is a fundamental difference between, on the one hand, the manufacture of limited, tailor-made goods, which makes it possible to maintain very selective prices for financial elites – the snobbish effect – and, on the other hand, standardised mass production for mass markets.

3.3. Luxury markets

3.3.1. Clienteles and segmentation of the luxury market

31The luxury market is divided into three hierarchical classes with corresponding categories of potential customers with very distinct purchasing power:

• Superluxe’, “hyperluxe” or inaccessible luxury is that of a unique, individualised, tailor-made product (Castarède, 2010). This is a niche market, eminently selective, which targets a minority composed of large historical fortunes and financial elites who play on the subtle distinction - discretion of logos, brands.

• Semi-accessible luxury, intermediate luxury, which reaches the top of the range, is the core of the luxury market in terms of quantity. It is the world of the Jetset, the world of the distinction displayed, the new rich and the bling-bling. These customers demand a very high quality and like to show their belonging to a social status through the display of their consumption.

• Accessible luxury is aimed at more “massive” customers, that of “luxury for all”. It is the newcomers to the luxury world and the occasional luxury drinkers who invite themselves into this “dimension”, the time to consume some accessible “objects” – mass produced by the luxury industry – guided by their instinct for mimicry and their quest for sensations and pleasure.

32The vitality of the luxury industry is based on rich customers (High Net Worth Individuals [HNWI]), super-rich and ultra-rich people (Ultra High Net Worth Individuals [UHNWI]). They are members of an exclusive community who evolve in privileged, personalised, reserved – not to say private, exclusive – environments, with subtle distinctions, in a quest for perfection in objects and services.

33The category of High-Net-Worth Individuals (HNWI) includes individuals with capital between US$30 million and US$50 million. There are approximately 210,000 of them in the world in 2014 for a cumulative wealth of US$26,000 billion in 2012. Their workforce is expected to approach 300,000 by 2020.

34Then, the category of Ultra High Net Worth Individuals (UHNWI) is divided into two tranches: on the one hand, individuals whose capital is between 50 and 100 million US dollars, and on the other hand, ultra-rich individuals whose capital exceeds 100 million US dollars, the famous “centa-millionaires”. There are 84,500 super-rich people in 2014 with assets of at least $50 million. The number of “hundred millionaires” would increase from 50,000 in 2011 to 62,000 in 2016, shared between North America (34%), Asia (42%) and Europe (24%).

35At the top of the wealth pyramid, some 4,000 families shared between North America and Europe have a wealth of more than US$250 million. A heritage built over several generations (sometimes more than ten generations) during which this culture of luxury was built and transmitted. This culture is emerging among the newly rich, especially in Asia, whose behaviour often seems very clumsy in the world of luxury; the education in the culture of luxury is taking shape with the second generation studying in the great Western schools.

3.3.2. The economic weight of luxury

36The luxury market has 35 different sectors of activity – which may not be exclusively luxury – which can be grouped into three categories :

• the person: haute couture, clothing, fashion accessories, shoes, jewellery, perfumes and cosmetics, leather goods …;

• home: tableware, furniture, decoration …;

• outings, trips and festivities: hotels, gastronomy, wines and spirits, cruises, yachts, cars, jets…

37The luxury market, taken as a whole, exceeded US$850 billion in 2014, an increase of 7% over a year driven mainly by luxury automobiles (+10%), luxury hotels (+9%), luxury personal goods (+9%), and luxury goods. (+7%).

38The heart of the luxury market is luxury for the person whose value has tripled in the last twenty years. It amounts to €223 billion in 2014 (compared to €27 billion in 2013 and 2012 billion in 2012). The main market in terms of turnover is the luxury car market. Growth was strong in luxury hotels and private aircraft sales (+9%), luxury cruises (+5%) and yacht sales. Their growth is driven by emerging markets (Asia, BRICS).

4. Luxury as a field of study

39Questioning the foundations of luxury, between ostentation, differentiation, aesthetisation, self-presentation and relationship to others, José Martín Hurtado Galves approaches luxury as an ambivalent ontological construction, luxury as an object and an idea of the object. Mauricio Díaz Calderón proposes to revisit luxury through cinematographic art with the different forms of representation of wealth, values and issues raised in a context of profound social inequality.

40Luxury in time and space, following the genesis of luxury in places, objects and practices: Gisela Paola Kaczan opened the reflection on the construction of social distinctions on Argentine beaches, with the first recreational practices of the idle elites who enjoyed adapting Parisian fashion models to them. The genesis of luxury is also the ingenious development of Geneva’s watchmaking industry, whose context and conditions Nadège Sougy analyses, which enabled Geneva to build its international reputation from the 19th century onwards. Carlos Henrique Costa da Silva opens up the issue of contemporary luxury in an emerging country, Brazil and the city of Sao Paulo: luxury in the city, between coexistence and segregation, over-consumption by some and impoverishment by others. Maximiliano E. Korstanje and Geoffrey Skoll extend the reflection on the construction of this political matrix.

41Tourism in the luxury sector is a vast field to explore, both in terms of practices and socio-economic issues. Luxury tourism is characterised by specific processes of tourism of places and the production of services and other services that are part of the luxury sector. Like the Sopheap Theng analysis, these products will stand out from other tourist offers by their level of quality (excellence), the reduced offer: the rarity that gives full meaning to the distinction (therefore no charter flights or large tourist complexes).

42Yolanda Onghena, through the prism of tourism, emphasises mobility, the democratisation of practices and the quest for life experience; luxury is in the use of time, the sharing of emotions, of privileged moments. The economic challenges are becoming clearer with the following texts. Bénédique Paul and Hugues Séraphin explain the challenge of luxury in Haitian tourism where the positive value of luxury motivates the project of a country that wants to break with the images of widespread poverty and underdevelopment ruining its prospects. Louis Dupont analyses the results of the economic strategy of an island in the Lesser Antilles, Anguilla, which has chosen luxury and high-end tourism; in contrast to mass tourism.

Conclusion

43Luxury is a vast field of research to carry out in increasing disciplinary approaches, for example around a geography of abundance, super-rich as proposed by Hay (2013) and the mobility of elites, initiated by Birtchnell and Caletrio (2014). From the transnational circulation of globalised elites to the construction of luxury spaces, between the opening and closing of spaces, privatisation vs. common goods, entry through luxury, beyond the study of the object itself, holds precious keys to understanding contemporary issues.

44Luxury imposes a distinction, it is the quality and cost of this quality, the time involved by the creative craftsman, with a history, a cultural dimension, at the forefront of innovation, the continuous search for perfection, magnificence; hence the term “art of living”. Luxury is opposed to mass, hence this distinctive relationship (provocative or subtle), a posture of resistance against the phobia of absorption by mass, of dilution in the mass. The mass heard with all these negative connotations, the mass that is always the other, the anonymous one that has failed, the one who lacks something distinctive. Mass is standardisation, macdonaldisation… And what better prism to distinguish oneself from the standardising mass than luxury?” A natural continuation of the progress of the human species” as Voltaire puts it. But access to luxury with its intrinsic material and immaterial qualities (rare, expensive, coveted, exclusive, excluding!) is discriminatory. Access is through money, individual wealth, which sends us back to the foundations of our own hierarchical, excluding, unequal societies…” Luxury is a necessary consequence of ownership, without which no society can survive and of great inequality between fortunes” (Voltaire).