16 Apr 2004 | Bose said...

Golly. I just want to know what the plan is for harvesting the gold and bling out of these pieces when their technology ages out 9 months later.

16 Apr 2004 | Bob H. said...

One possibility...aesthetic/emotional choice. I went to a conference last year in Chicago (User Experiene 2003) and Donald Norman talked about this very thing (about watches). People like the look of the expensive watch even though it's unclear how to tell the time. The item can be used as a discussion piece.

Look at the juicer that's on the cover of Donald's newest book - juicer image. He liked the way it looked even though the limited edition one he got suggested not using it as a juicer. I believe the one he purchased was gold plated and the juice could harm the gold.

Other possibilities...
showing off
trying to find happiness in positions
cell phone or watch collections

16 Apr 2004 | Don Schenck said...

The only reason to spend $100 on a cigar is status. Either that, or you're getting ripped off for a Cuban -- probably counterfeit.

Padron Anniversario Maduro, arguably the best NC, is about $20 and worth every penny. But a hundred bucks? You're nutso.

It's all about showing off, isn't it? Why else would some nut purchase, say, a Spyder instead of a more practical Hyundai?

:-)

16 Apr 2004 | beto said...

It is the same logic why high end audio buffs (A field I can relate to) look to spend tens of thousands of dollars on stuff like $3,000 interconnect cables and $25,000 amplifiers. (not to mention five-figure range speakers, and so on). At those prices, you'd swear the least thing those components would do is to bring Jim Morrison out of his grave and display it in ectoplasmic fashion on your listening room :)

(Truth be told, belief is the better quality of components, the less distortion and more of the "real sense" of a live music performance can be achieved, but still, you always wonder whether those claims have real, sustainable reasons or if they are just high end marketing BS)

A swiss watch is expensive and showy, sure, but it is also built to last so long that it may outlive you as well. Value is a relative thing.

16 Apr 2004 | Rob said...

Couldn't one make the same arguement for Apple vs Windows? Why buy an Apple? Don't get me wrong, I own an Apple. But the cost of purchasing an Apple vs a Windows pc is quite significant. Is owning an Apple like having a status symbol?

In terms of watches, there is a distinct difference in the quality of the time piece and components used. For example, An "Automatic movement" needs no battery. The mechanism winds itself by the movement of the watch bearer. Therefore the watch never needs a battery change. An "Automatic" watch typically cost more than a "Quartz" watch. Well worth price and the hassle of not having to changing the battery.

A book worth reading on this topic is Trading Up: The New American Luxury

16 Apr 2004 | Don Schenck said...

Rob ... yeah ... and once you own a few automatic movement watches (I have two), you have to invest in an automatic (electric) winder. It mimics the movement of an arm.

Sheesh. Where does it stop?

16 Apr 2004 | beto said...

I don't see owning an Apple as an status symbol - not in my case anyway. I just liked the Mac OS and what Apple had to offer better than anything the PC world had, specially upon some really, really bad experiences with a PC clone (later on, I learned Dells were really reliable machines, but the damage had already been made). Only thing that makes Apple have a status of some sort is their prices and, sure, their stylish product line. But those were not my reasons to decide on an Apple...

16 Apr 2004 | Don Schenck said...

While it's not *my* original thought, I've been telling folks for years that "exclusivity sells".

Here's all you need to do: Find a near-commodity item, create a high-priced, high-quality, *exclusive* model, and you'll be rich in five years.

Cell phones (Vertu) are a great example. Pens. Watches. Shoes. Something that folks can easily show off. Handbags. Scarves. You get the idea.

16 Apr 2004 | JF said...

Cell phones (Vertu) are a great example

Is it? Do you know how well it's selling?

16 Apr 2004 | Rob said...

Don- The concept of making a product exclusive is not what makes it successful in the market place as discussed in the book I mentioned in the previous post.

"New Luxury is a distinct genre of products and services. Unlike Old Luxury items, which are intended only for the very wealthy, New Luxury goods are meant to be accessible and appealing to a much larger audience. Unlike conventional goods, which compete primarily on price, New Luxury goods command a premium because of their superior quality, performance, and emotional appeal.

New Luxury goods and services take three forms, covering an extremely wide range of price points in dozens of categories. They are not always the most expensive items in the category, nor are they always the top of the line for the brand. They always sell at a premium to conventional goods, but are always affordable by the middle-market consumer."

Kiehls - New Luxury, Bath and Body Works - Masstige, Vasoline- conventional.

20 Apr 2004 | adnan said...

It's not necessarily about exclusivity nor is it about perceived value or function, its about what the product tells us about ourselves.

people often overlook how objects we own communicate about us. (and they don't necessarily have to be luxury symbols)

as far as electronics are concerned - however long it may take, its inevitable that they're going to make their mark in the luxury market.

Right about now, you'll see electronic firms attempting to enter the luxury market, but it won't reach tipping point until traditional luxury firms join the fray and they usually are the last one to jump on the bandwagon.

ps. Regarding New Luxury, its just a new spin on an old practice. i.e. a second hand Patek Phillipe would be a lesser version of an original Patek. :)

20 Apr 2004 | adnan said...

It's not necessarily about exclusivity nor is it about perceived value or function, its about what the product tells us about ourselves.

people often overlook how objects we own communicate about us. (and they don't necessarily have to be luxury symbols)

as far as electronics are concerned - however long it may take, its inevitable that they're going to make their mark in the luxury market.

Right about now, you'll see electronic firms attempting to enter the luxury market, but it won't reach tipping point until traditional luxury firms join the fray and they usually are the last one to jump on the bandwagon.

ps. Regarding New Luxury, its just a new spin on an old practice. i.e. a second hand Patek Phillipe would be a lesser version of an original Patek. :)

23 Apr 2004 | humidors said...

It's a simple marketing concept that you can make more money on something that people WANT rather then on what they need. For what you want you are willing to pay more...whether it be a cigar, fur, champaigne or humidors to keep your cigar. That's just human nature.