Luxury Goods and Services – A Very Defining Point
The term luxury is used broadly to describe a good that has high prices in relative to other similar goods and services. In economics, a luxury good is usually a good whose demand increases more rapidly than proportionally to income, so that relatively fixed expenditure on the good becomes a higher proportion of total spending. Luxury goods tend to have a high margin of profit, but prices are generally less elastic than other goods and services. Demand is normally elastic with respect to price; in other words, if everyone wants the good then the price will fall. On the other hand, luxury goods normally increase in price when people feel they need them. Thus we find luxury items such as clothing, cars, and other necessities increasingly becoming a mark of affluence.
Luxury goods can also be classified according to geographical location. Whereas some luxury goods reflect the culture and social class of their purchasers, others are common to most wealthy consumers in particular areas. Fashion houses are especially popular with affluent consumers. Luxury brands are also very different to mass brands. Luxury brands reflect the culture and social class of their owners, whereas mass brands are created for mass audiences. Luxury brands usually command a higher price than competing brands.
Defining luxury leisure and travel experiences is made much easier by the internet. There are numerous websites that allow users to define what they mean by luxury. The internet also makes it much easier to compare luxury goods and services. If you’re looking to buy luxury goods, the internet is the best place to look.