Premium Value and Luxury Life
The finest-value goods and services are not exclusive opulent provisions or service experiences, and therefore do not make the ranks of UberInnovation. They do, however, sell in sufficient numbers whilst perceived as superior value-added, in turn commanding premium prices.
Consumers often seek and buy premium merchandise or first-class service provisions because they consider the high price as an indication of high-quality. A while back, an associate of mine up-graded to first class on trip to New York City. Three years on, he still rants on about it. The other chief reason is that myriads of clientele consider it as a sign of self-worth. Authenticating the buyer's status, conquests and achievements; and a clear signal to others that the holder is a member of an exclusive club.
The premium perception is most significant with complex products that are hard to check; or experiences that cannot be validated until used. The greater the uncertainty surrounding a product, the more consumers depend on the price/quality hypothesis, the greater premium they are prepared to pay. Accelerating economic growth in emerging countries will elevate millions of people to the middle class. By 2030, almost 80 percent of the global middle class – about 3.9 billion people – will live outside Europe and North America. This development will lead to strong demand for advanced consumer products. In 2030, about 80 percent of the global middle class will live outside the developed world.
The 400 million famillies that earn more than ~$250,000 per annum and have equity in their home(s) above $2,000,000. So what do they want? High street off-the-shelf and cloned hand baggage; a bottle of VIN de Pope at the weekend and a meal at the Ritz? No? But what about a slow-burn, long-term, lower-risk investment portfolio; double indemnity barrier insurance for all assets; private schooling for their kids; and pension scheme most would pray for. Yes!
Now add up over 45 working years, and this premium house-hold sector of the population earn over and above $11.25 million. Now multiple that by 400 million people achieving these status and that equates to over a one-and-a-half-trillion-dollars. And now you know why Rolls-Royce is booming and premium luxury markets exist.
A classic exemplar is the pricing of luxury production cars. The build cost of such vehicles is obviously greater than a mass-produced family saloon, as a result of superior design, fine materials, and outstanding craftsmanship approaching nine-sigma production standards. But not much more. Double and even triple the cost, at a push. Yet the likes of Roll-Royce, Bentleys and Aston Martine retail their first-class wheeled machines at five, ten, even twenty times as much. This premium or prestige pricing strategy is designed to attract status or fashion conscious customers. The elevated pricing is used to improve and reinforce a product's image.
So here is a premium concept to drench your appetite (well at least my vision of a Premium Kitchen). Good cooks like good kitchens. Passionate, well heeled cooks demand the finest Kitchen they can get their hands on. But putting together an exceptional Kitchen, however, will cost more than just an arm and a leg of lamb. So here is my design for a premium dream Kitchen.
First, Sub-Zero’s PRO 48 refrigerator, retailing at $13,800; measuring 48 inches side-by-side made from 100 percent sculpted steel, featuring separated refrigerator and freezer using two isolated compressor-evaporator units. Each compartment has its own independent, climate-controlled air to keep food fresh and untainted. This means that no air, moisture or unwanted aromas pass between the refrigerator and the freezer. Hence food tastes just like it should. It further has a microprocessor controlled temperature environment, with auto-closing, heat-sink resistant glass fronted doors.
The cooker, the celebrated Grand Palais 180; retailing from around $46,000. The stove includes two vaulted ovens (one gas and one electric). Two large hot plates, two large solid brass burners, a lava rock, a teppanyaki grill and induction plate; all coming along with an infinite choice of finishes, combinations, materials and colours (yippee).
The 3200-Watt stainless-steel microwave-oven is the Panasonic NE-3280 Sonic Steamer. The retail price: $3,099. Featuring an ultra-sonic steamer and holding up to two outsized trays. The three-stage cooking device has five power levels and eight programmable pads that can hold up to sixteen programs. For larger fare, the center shelf is removable. It even has a self diagnostics to help ensure that it operates as well as the day it was purchased.
The dishwasher is a great time saver. So, the Miele LaPerla II selling at $2,500 would be my choice. The specification includes star rated low energy design, double waterproofing, near silent operation, ergonomically hidden control panel, 16 different wash routines, up gradable function programming, and turbo settings.
Next, the Kenmore front-loading washing machines at $900 a throw. The Kenmore ‘High-Efficiency’ washers live up to its tag, with a good pedigree of durability and reliability. The machine uses 69 percent less water and 60 percent less energy per load compared to conventional washers. It also spins at 1000 rpm, meaning less spent energy drying clothes.
And one last indulgence here, a must in all cook’s tool box. A kitchen knife tallying $2,760. Donning an African ebony handle, nickel silver bolster, beautifully shaped for perfect grip. The cutting part is the history of Japanese sword making: the Hottori original Cowry X Damascus blade, with a Cowry sandwiched cutting edge made up of 60 layer of Nickel Damascus steel…Make of these kitchen gadgets what you will, but each vendor is selling in good quantities.
And now if you are still hungry for premium, let us dine out. Save for the four-stars and the true dives, all of the most successful restaurants have one offering that everyone orders: the destination dish. In addition to the simple delight of eating these undeniably fantastic things, these items are also huge money makers for their restaurants. So, in the biggest restaurant city in the world - Manhattan - which are the highest-grossing dishes? And what kinds of ridiculous sums are they pulling in?
New York’s top three highest grossing dishes: (1) The Potted Pig Cheeseburger: $17. A char-grilled eight-ounce burger with Roquefort cheese and shoestring potatoes. Yearly Gross: $1,241,000. (2) Baltazar Steak Frites: $30.50. Classic steak frites with maître d’ butter or béarnaise sauce. Yearly Gross: $951,600. (3) Waverly Inn, Macaroni and Cheese: $55. Macaroni with cheese and shaved white truffle. Yearly Gross: $501,875.
Primium dining is an exciting experience for food junkies. Visiting one of the most expensive restaurants in the world gives one a true culinary encounter. Aragawa, Tokyo, Japan dining for one: $368. Aragawa is a very famous steak house in the district of Tokyo’s Shinbashi. Though reputed for its beef dishes throughout Tokyo, it should be the best place for steak lovers. Steak coupled with pepper and mustard is what that the restaurant serves its guests with pleasure.
Alain Ducasse au Plaza Athénée Dining for one: $231. This is one of the three famed restaurants under Alain Ducasse; Plaza Athénée is located in a Grand Hotel of Paris. It remains closed during summer month every year and during the days before Christmas.
Gordon Ramsay Dining for one: $183. Gordon Ramsay is a British chef mading his venture into the field of restaurant business with his eponymous restaurant in 1998. They only have 13 tables but still experience a crowd every evening. The mainstay features of the menu are Cornish Lamb and pigeon with foie gras.
Now let us go home a watch some TV. And if you are in the market for a television that is priced for its technical merits, then you will want to take a look at the BeoVision 4-103 priced at $140,000. Featuring a 103-inch 100Hz plasma screen, this Bang & Olufsen television set acknowledges that size really does matter. Management and Auto Picture Control make sure that you always have the best possible picture, regardless of how much ambient light is in the room or how old the colour elements in the plasma screen are.
Premium Cars. Most people are baffled between Rolls-Royce (RR) Group plc and Roll-Royce Motors (RRM). They are, in fact, two separate corporations these days. In 1971, Rolls-Royce was nationalised as Rolls-Royce Limited, and in 1973, the car division was separated from the parent company as Roll-Royce Motors Ltd. RR, the world’s second-largest maker of aircraft engines, continued as a government owned company until it was privatised in 1987 as Rolls-Royce plc. Certainly a GigaOutfit, RR plc announced order book of £58.3 billion in 2009.
Premium Apparel. The business suit, the traditional outfit of men in the Western world, is generally worn with a dress shirt and tie. The modern suit first made its appearence in fashion during the late nineteenth century. Suits have always been a status symbol used in formal occasions and when conducting business. The fashions of suits have changed, but suit’s power to signal rank and membership maintains. So we must ask, what are the most expensive suits in the world?
Forbes released a yearly article of most expensive suits, which can be bought from a rack, as opposed to custom made expensive suits. Indeed, while the splurge appeal of custom and made-to-measure suits is still a draw for some shoppers, chances are they’d do just as well with a suit that could be fitted to their peers. ‘Our off-the-rack suits are the same make with the same natural shoulder as our custom suits,’ says Jay Kos, a high-end New York suitmaker, whose beautifully made classic men’s suits have a wide appeal among the city’s heavier hitters. ‘Guys who are just coming into money want custom suits, so they can choose their own fabrics and details. But guys who already have a few custom suits are also buying off-the-rack if they see something great.’
1. Brioni $6,000
2. Kiton $5,800
3. Canali $4,200
4. Bottega Veneta $3,800
5. Giorgio Armani $3,595
6. Ralph Lauren $3,295
7. Oxxford Clothes $3,000
8. Jay Kos $2,800
9. Issey Miyake $2,800.
Some people may suggest business suits are too formal for the modern world of casual dress. Nevertheless, it is unlikely that the use of suits will decline, because even a the most casual slacker needs an expensive suit for weddings, funerals, court appearances, and even some job interviews. The most expensive suits in the world are modern day replacements for polished European medieval armor.
“Cosby” sweaters – $5,000 When playing Dr. Heathcliff Huxtable on The Cosby Show (1984-1992), Bill Cosby most often wore shirts with loud, geometric, swirling and/or patchwork patterns. This habit gave rise to the term “Cosby sweater,” used to describe similar sweaters. In 2008, Hello Friend and the Ennis William Cosby foundation put three of those famous sweaters up for auction on eBay.
Berluti Rapiécés Reprisés – $1,830 These shoes, inspired by Andy Warhol, are notable for the patched appearance traditionally reserved for clothing. Because Warhol requested a visible patch only on his right shoe, each set includes an additional left shoe that remains unpatched.
Eton 80th anniversary dress shirt – over $45,000 Swedish shirt-making company Eton, celebrating their 80th birthday, created this shirt out of the finest Egyptian cotton. Of course, it couldn’t be the most expensive shirt in the world without a few diamonds. Both the studs and the cufflinks are encrusted with diamonds—white diamonds on the cufflinks and coloured diamonds on the studs.
Antique Levi’s jeans – $60,000 Levi Strauss Company bid $46,532 to buy a pair of their own brand of jeans back on the popular auction site eBay. However, the most expensive jeans were an average pair of 501 jeans manufactured in the 1880s and purchased by a Japanese collector in 2005 for $60,000.
Satya Paul Design Studio necktie – $220,000 The Satya Paul Design Studio, a company with roots in the early stages of India’s fashion industry, displayed the most expensive necktie in the world at a fashion show aptly titled “Cultural Ties” in Mumbai on October 29th, 2003. Tied around the neck of bollywood film star Salman Khan, this unique tie is made of pure silk with a pattern in 150 grams of gold. It’s also adorned with 271 diamonds weighing 77 carats weighing 77 carats total.
Sneakers or trainers are possibly the most popular type of shoe in the Western world. Would you pay $50,000 for a pair of what will turn out to be smelly trainers, though? What if they were encrusted with diamonds?
Laced Up, a boutique based in Atlanta, Georgia, has just launched a new customization service called Solitaire Kicks. Their first offering, a $50,000 pair of Nike Air Force One “So Cals,” may just be the most expensive sneakers in the world. Solitaire Kicks offers customers the chance to deck out their sneakers with yellow, blue or white diamonds as well as gold and platinum. Laced Up offers the service in partnership with Prriya & Chintans Couture and Jewellery, with whom customers will consult when customizing their expensive sneakers. The So Cals themselves bear a Nike logo cast in gold and adorned with 11-carat diamonds. The diamonds’ casings are affixed to the shoes by gold stitching. The most expensive sneakers in the world were presented to rapper Big Boi at the Solitaire Kicks launch party in late November.
So, Just How Do They Do It: Perception, Discernment, Sensitivity!
Well, what do you think? Unless you happen to be UberRich or at least a High Net Worth Individual, then you may have read this post with raised eyebrows! Even in slow growth times and even in downright times, the superrich, the wealthy and the very comfortable are still – ably – well-heeled.
One could argue that the sales for the makers of uber and luxury goods means that the recession never happened. In other words, people who were less financially upset during the downturn kept their purse strings open. The higher-middle-class consumers also bought more and finer stuff and that is not necessarily a sign of wanton spending. The downturn and now flatline is dreadful, but not enough to change higher-end consumer behaviour.