In view of the dynamic growth in the luxury market and the availability of luxury goods to a wider range of consumers than ever before, the luxury market has transformed from its traditional conspicuous consumption model to a new experiential luxury sensibility marked by a change in the way consumers define luxury. In a global context, it is critically important for luxury researchers and marketers to understand why consumers buy luxury, what they believe luxury is and how their perception of luxury value impacts their buying behavior.
The main contribution of the present paper is to develop an integrated conceptual framework of consumers' luxury value perception for researchers and marketers of luxury goods who may wish to measure the dimensions of individual luxury perception as a general basis for marketing strategies to improve purchase value for different segments of consumers that span the globe. The model illustrates that individual and social as well as financial and functional dimensions significantly impact the consumer's luxury value perception and consumption on an international level.
As luxury is a subjective and multidimensional construct, a definition of the luxury concept should follow an integrative understanding. For our purposes, we define luxury as the highest level of prestigious brands encompassing several physical and psychological values. To explain consumers' behavior in relation to luxury brands, apart from interpersonal aspects like snobbery and conspicuousness, personal aspects such as hedonist and perfectionist motives as well as situational conditions (e.g., economic, societal, and political factors) have to be taken into consideration. The consumption of luxury goods involves purchasing a product that represents value to both the individual and their reference group. Referring to personal and interpersonal oriented perceptions of luxury, it is expected that different sets of consumers would have different perceptions of the luxury value for the same brands, and that the overall luxury value of a brand would integrate these perceptions from different perspectives. Even if the overall luxury value level of a certain product or brand may be perceived equally across national borders, a differentiated measurement may reveal that the overall luxury value perception is a combination of different evaluations with regard to the sub-dimensions. Furthermore, this differentiated perception of luxury value may be dependent on the cultural context and the people concerned.
Following a comprehensive understanding of the luxury construct, all relevant current and potential value sources of the consumers' luxury perception should be integrated into one single model. A customer's luxury value perception and the motives for luxury brand consumption are not simply tied to a set of social aspects of displaying status, success, distinction and the human desire to impress other people, but also depend on the nature of the financial, functional and individual utilities of the certain luxury brand. Pointing to the fact that luxury value lies in social and individual as well as in functional and financial aspects, it is important to synthesize all relevant cognitive and emotional value dimensions in a multidimensional model.
Our model might be a useful instrument for both academics and practitioners who want to better understand consumer behavior; it may also serve as a basis to successfully create, market and monitor luxury brands or products in a cross-cultural context. Even if the world of luxury products is not homogeneous, we believe that the underlying consumer motives and desires transcend national boundaries in a structure that derives from the individual's situation and the luxury value dimensions. Our multi-dimensional model integrates these consumers' value perceptions from different perspectives. Encompassing cognitive and emotional dimensions, it might already lead to a better understanding of the conditions and drivers of luxury product perception and to a broadened view of luxury value which lies in social, individual, functional, and financial aspects. …