Many people are yet to realize that we can want every good thing, but we don’t need every good thing.
The purchase of an expensive handbag is today not uncommon to get a pair of shoes from an expensive shoe outlet.
It is not far from true that the physical appeal of luxury goods is undeniable; the leather is softer, the shoes are more comfortable—but the price tag is often dissuasive. Unless you have got a good job or great savings habits, luxury consumer goods will sit on your credit card for a long time.
The Irrational Consumer
It is well known that people don’t behave rationally, and considering the huge consumer debt that they have. In most times, consumers don’t act in their best financial interests. Luxury goods are a great example of how irrational we can be; a decent and sturdy handbag can be bought for $50, yet people will still spend thousands to buy a brand name. It has always been this way, and consumers’ want to own the finer things in life will likely never change.
One reason involves the way we tend to look at the merit elements of a product while ignoring its demerits. There is rather no need to explain why this works in favor of the luxury goods companies’ marketing departments. Take Apple Inc., for example: consumers wait overnight for new releases and have strong brand loyalty, even though MacBooks and iPhones aren’t technologically unique or superior. Samsung makes phones with better features, and Microsoft Corporation and Xiaomi make phones at a much cheaper price point. Nevertheless, Apple seems to break sales records year after year. The company has mastered the art of retail marketing and exerted more economic influence on us than any company in history, according to NYU Professor Scott Galloway.
Since some people perceive non-luxury goods as inferior, they are quick to point out the negativities of those products.
When talking about a cheap foreign car that needs repairs, it’s a piece of shoddy construction; on the other hand, a luxury car that needs repairs is just suffering from wear and tear. Some conclude that higher-priced goods are of better quality and we spend irrationally believing you get what you pay for, regardless of whether the goods are proven better than their affordable contemporaries.
Self-Esteem and Luxury Goods
Low self-esteem is a great determinant of whether a person will buy luxury goods that they may not be able to afford. For consumers trapped in institutionalized poverty or those living paycheck to paycheck, a luxury good can go a long way in increasing self-esteem or providing a sense of belonging.
With marketing departments creating a need for luxury goods and the rise of online shopping, a $500 scarf is just a click away. Luxury goods are the ultimate retail therapy, and fortunately for luxury brands, the internet has made them easily accessible for impulse buying when you’re feeling inactive or depressed.
A sense of accomplishment is yet another reason some people buy luxury goods. They want to reward themselves for their hard work by treating themselves to something they typically can’t afford.
Authenticity Matters
There is a good reason people will pass the fake Rolex sellers on the street to pay full price for an authentic one; despite appearing the same, the owner will know that they don’t have a real luxury good.
This flies in the face of reason yet again. If we buy luxury goods to show off to others and to feel like we belong, why wouldn’t a facsimile do the magic of an authentic one?
Researchers at Yale University have found that this quest for authenticity develops early in childhood. A study that tried to convince children that a cloning machine had produced their favorite item found out that most children refused to accept the duplicate as identical. It turns out that the sentimentality of the item, the memory or pride or feeling that comes from having bought a genuine luxury good, is part of the reason that we seek authenticity. Simply put, treating yourself to fake Dolce & Gabbana would be like not having treated yourself at all.
Conclusion
People buy luxury goods for a variety of reasons, all of which are related to the strong emotions that we attach to expensive material goods. Whether we are financially comfortable or not, we will often buy luxury items to show off or gain acceptance from others and to reward ourselves for an accomplishment. Now that we understand the psychology behind why people buy luxury goods, we’ll be better equipped to quash down any emotions that try to convince the rational part of our brains that the more expensive something is, the better its quality.
