In business, luxury goods are just that — a luxury. This means they are not necessary to live, but these goods are in high demand in a particular culture or society. People with the funds to purchase these goods are willing to pay a high price for luxury items due to exclusivity, the idea that not everyone will be able to get the item or experience a brand is selling. Therefore, people can show off their wealth by owning these items or partaking in these experiences offered by luxury brands.
Luxury items can differ between different cultures, societies, and people, but the following items are commonly considered luxury goods in the American economy:
Luxury goods can also refer to services that are desirable but not necessary to live. Examples of luxury services in America include:
While a luxury good is technically any item that is unnecessary to live, in the consumerist world, the definition goes a bit further. Luxury can be hard to define, as the factors that determine whether an item or service is luxury can differ, depending on the good or service in question. Some factors that can be considered when determining if a good or service is a luxury are:
Typically, goods follow the law of supply and demand, meaning as prices of an item decrease, demand for the product tends to increase. Veblen goods are luxury goods that defy the laws of supply and demand. As the product becomes more expensive, it becomes more desirable, and as the price decreases, people lose interest in the product.
Veblen goods are desirable status symbols. People don’t purchase Veblen goods to hide them. They want to show them off and let others know they’ve purchased them to increase their social status. For example, someone who buys a $2,000 Gucci handbag is going to wear it proudly rather than hide it in their closet to collect dust. However, if Gucci started slashing prices to $100 per handbag, their product would become less desirable since it is no longer as exclusive to those with significant wealth.
As society changes over time, so does what is considered a luxury. For example, animal skins and furs used in fashion were once considered high luxury. While this could still be true to some, our society has, for the most part, adopted the idea that animal brutality should be stopped. This has made designer clothing and accessories made with animal products less desirable.
The concept of sustainability as a whole has had an impact on the luxury goods industry when it comes to our society seeking to create less waste and minimize the emission of greenhouse gases. This impacts most industries in some way, including fashion, automobile, and travel industries. Luxury brands need to be aware of societal changes and how they impact a brand’s desirability and should aim to make adjustments if they want to stay relevant.
If you are a business owner, it is important to protect your brand and its reputation by trademarking your logo and company name. This is an effective way to prevent others from attempting to capitalize on your strong reputation. A strong trademark can help you to protect your brand from falling victim to copycats attempting to make and sell counterfeit products. Without a clear and strong trademark, you could have a difficult time winning a case, so a lawyer can help guide you through the process of creating a specific and unique trademark that is more likely to hold up in a legal case.
In addition to the importance of trademarking to avoid others from copying your brand, trademarking can also help your brand increase its luxury status. When you are the only brand offering a particularly sought-after item or experience, interested consumers have no choice but to support your business. Without trademarking, others can attempt to take advantage of your successes legally by creating businesses with names or logos similar to yours, leading to a saturated market and confused consumers.
Working with an experienced trademark law attorney is crucial when it comes to developing a trademark and protecting your brand. You should not wait until your brand is popular before starting the process, as these types of cases can take a while, and you could be susceptible to your trademark being stolen as the case moves through the system. At Four Reasons Legal, we have over a decade of experience helping businesses protect their intellectual property and are ready to help guide you through the process of protecting yours.