It’s been about 15 years now, since sociologists and marketers were amazed to discover a new phenomenon. BMW is parked in front of our discount stores. Why would somebody who pays fifty or sixty thousand pounds for a car want to save 50 cents on a liter of milk? The answer was, of course, that they were ‘trading up.’ An explanation of this can be found in this excellent book. Trading up is what consumers are prepared to pay a premium price for certain products that they think bring more luxury. It can be in many different areas, from Belvedere vodka or Boston Beer which costs 50% more than standard beers. It can be in things like pub food or in the doll industry, with American Girl.
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BOOK REVIEW: “Trading Up: Why Consumers Want New Luxury Goods–and How Companies Create Them” by Michael Silverstein & Neil Fiske (2008)
BOOK REVIEW: “The Luxury Strategy: Break the Rules of Marketing to Build Luxury Brands” by J.N. Kapferer & V. Bastien (2009)
If you are currently spending a few weeks in a vacational coastal city of your country, jealously admiring the ostentatious wealth of the rich and famous, this book may interest you. It defines what constitutes a luxury product and how companies develop their strategies to profit from this status.