American and European Consumers Pushing Up The Price Of Luxury Goods
Luxury items are so synonymous with true wealth and success, that they are impossible to separate from them in any conversation. When people talk about luxury items, they are almost always talking about something that is very expensive and out of the price range of most people. Luxury items are usually thought to be very exclusive and very few people can afford them, but that is simply not true. True luxury is mostly an Italian and French company technique: a careful balance of authentic high quality and seemingly irrational but undeniably wonderful emotions, that result in very plainly defining perfectly rational buying behaviour.
Most luxury goods and services are very attractive and visually appealing because they are of a very high quality and appear to demand attention. The Swiss made watches and furniture for example, are so visually appealing because they represent the ultimate in design and sophistication. Consumers want to be associated with these kinds of products because they feel that they need to be, that there is a reason why they are being charged so much for them and that it must be worth it. There is a psychological effect behind this that is very easy to understand, but the simple fact is that luxury goods and services are priced so high precisely because they make excellent quality products with a superior good name attached to them and that cannot really be argued because it is the quality of the product and the reputation of the company behind them that persuades consumers to pay more for them.
So we have to ask – why are so many Americans and Europeans spending so much money on what looks to be essentially junk? Is it because these brands represent superior value for money and superb designs, or is it because consumers feel they must have these items because the major luxury brands that they support cannot possibly produce them at a reasonable price in the form of luxury items that they themselves can afford? We may never know the real answer to this question, but one thing is clear, that there is a massive demand for high quality luxury brands and their overheads are very high indeed. It therefore follows that consumers of such brands are in a strong position to negotiate a better deal with their suppliers, especially those which do not belong to the major luxury brands and are instead smaller companies that are trying to make a name for themselves in the relatively new market place.