Affordable luxury (9 Nov 2007)

The idea of affordable luxury is oxymoronic, the kind of market segment that sounds so stupid that even the WSJ feels obliged to put it in scare quotes, as in the headline for this article in today's paper. The term refers to people who aspire to seem as though they are rich but can't afford true luxury goods -- the allegedly recession-proof companies who make goods for the ultra-wealthy, people who don't become noticably poorer when, say, the currency they use drops 20 percent in value over the course of a year. Affordable luxury, to cite the examples in WSJ's story, comprises such brands as Nordstrom, Coach and especially Polo Ralph Lauren, whose marketing reeks of the signifiers of the core affordable-luxury fantasy of spendthrift leisure -- yachts, polo ponies, sports cars, country houses and all the rest. The affordable luxury segment delineates the line between middle and upper class, but it makes for a trap -- its goods simulate but do not replicate real luxury goods, and thus mark its consumers as forever aspirational. Somewhat like (if I remember right) the green light at the end of The Great Gatsby, it's a tantalizing beacon that is ever receding the more one chases for it.

And as I sat there brooding on the old, unknown world, I thought of Gatsby’s wonder when he first picked out the green light at the end of Daisy’s dock. He had come a long way to this blue lawn, and his dream must have seemed so close that he could hardly fail to grasp it. He did not know that it was already behind him, somewhere back in that vast obscurity beyond the city, where the dark fields of the republic rolled on under the night.

Gatsby believed in the green light, the orgiastic future that year by year recedes before us. It eluded us then, but that’s no matter -- tomorrow we will run faster, stretch out our arms farther. . . . And one fine morning --

So we beat on, boats against the current, borne back ceaselessly into the past.

Okay, the comparison's not perfect but once I looked up the reference, I couldn't resist quoting it. And there is something tragically backward looking about chasing phantasms of the luxe life.

Anyway, I root for marketers in the affordable luxury niche to fail because they prey on the inadequacies of their target consumers, which implies that they are somewhat in bad faith. When they struggle, as they are now, it's something of a trailing indicator, suggesting that suffering for consumers has already taken place and is being passed down the chain (and sure enough, mounting credit-card defaults seems to indicate that the people living beyond their means can't keep it up much longer), so celebrating the travails of Nordstrom is like cheering for the discomfort of those insecure not-quite-wealthy people I'd in theory like to see protected from the affordable-luxury vultures. Not that affluent middle class people deserve special protection; it's just irksome to see economic systems built on individual insecurity and misery -- that dynamic trickles down to all the classes, enhancing misery at every frontier between socioeconomic classes.

But still, the fact that the wannabes have begun to stop spending their money at these retailers suggests an opportunity born of crisis (a la Naomi Klein, perhaps) in which the affordable luxury market disappears under a wave of change in consumer purchasing patterns. From the WSJ story:

Alison Santighian says she and her husband, managers for a federal contractor in Washington, are contemplating reducing spending after several years of buying gifts at Saks and Nordstrom. "We might take the money we would normally spend on each other, and put it in savings," she says.

Why couldn't this become a habit for such customers, who might then learn some alternative way to establish their presence in a community rather than through signifying status through shopping. Maybe they can banish that status anxiety once and for all. But then I guess that vision is my own green light.