The Luxury Trap: Why it’s a Mistake to Define Luxury By Price

If a brand doesn’t manage the brand story and the customer journey, it can’t create consumer value, never mind extreme value.

“Authentic” means being completely real (95-percent authentic isn’t enough.) Consumers, especially Gen Zers, identify weaknesses immediately and will walk away from inauthentic brands. In a time of so much digital noise, brand storytelling is much more important than ever before.

A great brand story, followed by a consistently excellent execution of that story across all customer touchpoints, drives value.

Luxury brands have to create an extreme amount of value for their consumers. Design, packaging, and function are undoubtedly important features. However, they aren’t what drive Added Luxury Value (ALV), and ALV is the precondition that’s needed before someone will even consider buying a luxury brand.

This is what I call the luxury trap. It’s a fatal mistake many brands make. Defining a luxury brand by its functional aspects and high prices cannot replace the value a brand creates.