Most often when luxury consumers think of affordable luxury generally they think lesser. Truly the cult following of the most successful luxury brands such as Louis Vuitton and Hermes are not viewed as affordable luxury. At least up until now have not been thought of as affordable luxury.
During 2009 when the luxury industry experienced an 8% decline we saw luxury brands using the term affordable luxury and discounting merchandise. Often even using the worst four letter word that is taboo for luxury like SALE! Needless to say this strategy did not work both Valentino and Prada Holding became mired in debts. Also French brand Christian Lacroix and German brand Escada had to file for bankruptcy protection earlier that year in 2009.
All luxury brands are looking to China and for good reason because by 2014 China is predicted to become the largest luxury market. With growth of 3% to 5% projected for 2011. Again, leading back to the meaning of affordable luxury and what it means now.
The next big focus for luxury brands is India which is developing into a major destination for luxury products. Because India is influential in art and jewelery makes it prime for luxury brands and of course it does not hurt that India has the fastest-growing population of millionaires in the world. Having a total of 1.5 million households in the country which can realistically afford to buy luxury goods.
No surprise that Armani, Burberry, Noraletto and Raymond Wiel are among the high-end specialists that have established a presence in India, albeit through joint ventures, as required by government regulations. Luxury jeweler and watchmaker Cartier entered the country in 2008 and recently announced plans to increase the size of its distribution network.
Which comes as on shock that Donald Trump would want a presence in India also. Actually, two years ago prior Donald Trump Junior announced that the company was looking to see if India was the right market for the Trump brand. The company even set aside up to $1 billion dollars to develop projects specifically for the India market.
Trump teamed up with Bradford License India, a leader in brand licensing, to introduce the Trump brand to the emerging Indian market. The focus will be to expand the Trump brand into apparel, fashion accessories and home and lifestyle products inspired by his luxury properties around the world. The term “affordable luxury” will be used as a notion that one can live richly without spending a fortune.
Now that’s interesting. I wonder will this work for Trump and other luxury brands who use the affordable luxury concept? Is this another meaning for discount or sale? The luxury industry is expected to bounce back in 2011 but looks like luxury brands are still struggling with how do they define the perception of luxury in a gloom economy. A better way to say we are still in a recession.