For many international travellers, buying a luxury handbag is not something uncommon: perhaps just as common as buying a T-shirt at Target. While the appeal of luxury goods is obvious – the leather is soft; the logo is flashy – the price tag can be off-putting. Unless you have a good job with a high salary, buying luxury consumer goods can create a financial burden. Yet studies have revealed that humans do not always act rationally. Many consumers who buy luxury goods are not in a financial position to be able to afford luxury goods. The proof of this may be in the high rates of consumer debt that many Americans have. Clearly, Americans do not always act in their best financial interest.
- Why luxury goods look so appealing:
While a high-quality, durable handbag can be bought for around $100, some people choose to spend thousands of dollars on a luxury-brand handbag that performs the same function and is of the same quality. For example, a Ted Baker handbag is good enough, yet some women would buy handbags from Chanel and Dior.
One explanation for this is the human tendency to overemphasise the positive elements of a product and ignore its disadvantages. For example, in the case of Apple, consumers wait overnight for new releases of iPhones, iPads and Mac computers. This despite the fact that Apple products are not technologically unique or superior.
Actually, Samsung makes phones with better features (compared to most models of the iPhone). Microsoft and Xiaomi make phones that have a cheaper price point. But Apple experiences a high degree of brand loyalty and seems to break sales records year after year.
In some cases, low self-esteem can be a factor that influences whether or not a consumer buys luxury goods, especially if they cannot easily afford the cost of luxury items. For some consumers, a luxury good can go a long way in increasing self-esteem or providing a sense of belonging.
With the rise of online shopping, a $500 scarf is just a click away. For some people, luxury goods are their retail therapy. Luckily for luxury brands, the Internet has made them easily accessible for impulse shopping. Indeed, luxury brands such as Tiffany & Co., Cartier, Gucci and Versace all have online shops nowadays.
- Other reasons why people go shopping during international trips:
A sense of accomplishment is another reason why some people buy luxury goods. They want to reward themselves for their hard work by treating themselves to something they usually could not afford. This is not necessarily the best habit.
There is a reason why people may decide to pass up a fake Rolex in order to pay full-price for a real one, even if they look the same. Despite appearing the same, the owner will know that they do not have a real luxury good.
Researchers have determined that this quest for authenticity develops early in childhood. A study that tried to convince children that a cloning machine had produced their favourite toy found that most children refused to accept the duplicate as identical. It turns out that the sentimentality of the item – the feeling that comes from having bought a genuine luxury good – is part of the reason that people seek authenticity.
That is to say, chances are treating yourself to a pair of fake Christian Louboutin shoes would be the same thing as having not treated yourself at all. This is apparently not a helpful way to look at the situation. Obviously, a much better approach is to practise radical self-care and self-love when times are tough. In this way, you can identify your true priorities in life through active self-listening. Usually, your No. 1 priority in life is not a pair of expensive shoes. Oftentimes, it is your health and wellbeing, your family and friends or your romantic relationship. These often bring you much more joy, satisfaction and happiness than a pair of high-end shoes from a luxury brand. Research shows that women who do not have satisfying relationships tend to buy more luxury shoes. In contrast, women who are in healthy relationships probably go shopping less frequently. Therefore, if you are a woman looking to buy more luxury shoes, you may want to ask yourself why you need another pair of expensive shoes. Then you will find out what you actually need to focus on right now. This will certainly help you save more money and build more core confidence.
“International tourists buy luxury goods for various reasons. Nearly all of these reasons are related to the emotions that we attach to the purchase of expensive things. Whether or not a consumer is in a financial position that allows them to be able to buy an item, they may decide to buy it anyway in order to get a certain feeling (e.g. a feeling of accomplishment from hard work) or to get acceptance from others.”