Humans are status-seeking creatures, and status is expressed through signaling. If you're rich and so are the people around you, money alone ceases to be a differentiator. Ultra-luxury brands appeal to this by adding hoops that money alone can't clear: time, loyalty, relationships. The signal shifts from "I can afford this" to "I was invited to spend my money here."
Lines outside Louis Vuitton are more down-market, aspirational luxury - an ultra-wealthy person wouldn't be caught dead queuing on a sidewalk. Patek and Ferrari operate at the level above, where the signal isn't wealth but access. (HBS calls Ferrari's version "deprivation marketing.")
Is it a game worth bothering with? Enough people think so to sustain billion-dollar brands.
(Of course, PG writing an essay about being too smart for fancy watches - while knowing a lot about them - is its own signaling game, just aimed at a different audience)
Lines outside Louis Vuitton are more down-market, aspirational luxury - an ultra-wealthy person wouldn't be caught dead queuing on a sidewalk. Patek and Ferrari operate at the level above, where the signal isn't wealth but access. (HBS calls Ferrari's version "deprivation marketing.")
Is it a game worth bothering with? Enough people think so to sustain billion-dollar brands.
(Of course, PG writing an essay about being too smart for fancy watches - while knowing a lot about them - is its own signaling game, just aimed at a different audience)