Tuesday, June 09, 2009

Luxury and Korea: Some Thoughts

By Don Southerton
I follow Lux and the luxury market in Korea. On one level, luxury goods are status markers in a traditionally status conscious society--reaching back hundreds of years. That said, I also see today's younger generations in Korea driving demand up market. I feel at times it's similar to America in the 1980s as many looked to be young urban professionals (yuppies) with their Rolex watches, Gucci ties, diamond tennis bracelets, and BMW.

Author Richard Baker shares some insights from his forthcoming book, “The Future of Luxury: The Peacock and the Prius." I then plan to link Baker's thoughts to Korean wealth in a future blog post.

“Life style” is the result of a pattern of decisions made regarding how to spend, invest, give away or save time, money, attention and other scarce resources, which reflects a basic set of values. It is the organizing principle for the accumulation and signaling of social capital, i.e. wealth.

Through our research we have discovered six basic patterns of decisions, which are the result of six different affluent life styles:

1. Unmistakable Affluent (Donald Trump),
Tasteful Affluent (Ralph Lauren),
Practical Affluent,
Economical Affluent,
Understated Affluent,
6 and
Dependable Affluent (Oprah, Bono).

What is interesting is that each of these life styles can be lived at a variety of price points. Money, in a very real sense, is not the issue. It is the pattern of choices made with the money, the time, etc. There are distinct differences in where the various LifeStyles shop, travel, in what they read and drive, what they eat and drink, etc.

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