Luxury brands are alluring to many, but why are we attracted to these labels? 


1 Idea – 1 Challenge – 1 Quote


Idea From Me


Luxury items have a certain je ne sais quoi that makes them desirable. 


And we are falling for it. Hard.


We all want what we can’t have. It’s human nature. And when it comes to luxury items, this desire is only amplified. But why?


The psychology behind why we’re drawn to luxury brands is intuitive and informs how companies can use this to their advantage. The psychology behind the allure of luxury brands is an important tool for businesses looking to increase brand awareness, sales and profitability. 


The psychology behind why we’re attracted to expensive labels


Luxury brands have always been popular among the upper echelons of society. But in recent years, these brands have become increasingly popular. Why are we attracted to expensive labels?


There are a few psychological reasons behind our attraction to luxury brands. At its core, luxury branding appeals to our most basic human desires and emotions: 


  • First, we tend to equate high prices with high quality. Of course, this may be how we justify a luxury purchase, but it may be for practical reasons that we love luxury brands. Luxury brands usually offer better quality and craftsmanship than their cheaper counterparts, so it tends to last longer too.


  • Second, we often view these products as status symbols. This is probably the number one reason many indicate that we have arrived or are doing well.


  • Third, we believe that luxury brands will make us feel more special, confident and vital – boost our self-esteem. We’re willing to pay more for something that will make us feel good about ourselves and shows success and power. Wearing or using a luxury brand makes people feel like they have achieved something.


  • And fourth, luxury brands are also a sign of exclusivity, which is an integral part of the psychology behind luxury branding.


How a luxury brand makes us feel can be linked to our evolutionary history. Luxury brands can make us feel like we are buying into a particular lifestyle and culture and give us a sense of belonging to a privileged group.


The fortunate few buy luxury brands because they can, but next time you’re tempted by that designer handbag or pair of shoes, remember that there’s more to it than just the price tag. 


How luxury brands use psychology to their advantage


Luxury brands have long understood the power of psychology in marketing and advertising. By understanding how consumers think and what they value, luxury brands can create an emotional connection that encourages people to spend more money on their products.


Luxury brands often use aspirational marketing to appeal to consumers’ desire for status and prestige. By associating their products with wealth and success, luxury brands can convince people that buying their products will make them feel better about themselves.


Luxury brands also use exclusivity to make their products more desirable. By creating a perception that only a select few can afford their products, luxury brands make people feel special and privileged when purchasing them.


By understanding consumers’ psychology, luxury brands can create an emotional connection that convinces people to spend more money on their products. 


Luxury brand positioning


As mentioned above, to position your brand as a luxury brand, there are prerequisites like quality, scarcity and so on. Luxury fashion brands and haute couture with their high price tags and limited editions showed that it’s often about symbolic value. These same aspects of a luxury brand should be used to position your brand as a luxury brand:


Make quality craftsmanship and quality known.


They use the best materials and employ skilled artisans to create their products to be the epitome of luxury. Make it explicit to your potential customers how long it takes to make an item/ how many hours and how many steps are involved. This attention to detail ensures that luxury products are built to last.


Luxury brands often have a long history and heritage.


Many luxury brands date back centuries, and their pedigree is evident. History and heritage cannot be bought, but clever design can, if this is what is needed, create a sense that the brand has been around longer than it has. Speaking of design…




All designs should speak of sophistication and luxury, from logo design or even the simple business card to product design (think Rolls Royce) and packaging.




Limit the availability either in number and place and/or due to the price point.


Making luxury accessible


While luxury brands have traditionally been limited to wealthy consumers, there are now many ways for people of all income levels to enjoy the benefits of luxury. Although it is still considered a luxury item, the iPhone is an excellent example of how luxury products are being made more accessible. When people think of luxury brands, they tend to think of unaffordable products, but luxury is being made affordable to a broad audience. It was thought that brands that are made available to a broader audience due to social media with loose value, but high-end brands like Rolex proved this wrong as long as the brand identity remains authentic.


A middle-class person is consuming today what only Kings and Queens could not so long ago.


Luxury branding and COVID-19


 what does this mean for luxury brands in the age of COVID-19? The pandemic has caused a significant economic downturn, leaving many struggling financially. But people who were financially secure and had disposable income to spend on luxury goods were even more likely to prefer luxury products like Louis Vuitton, Ralph Lauren, Bottega Veneta, Christian Dior and Tiffany & co. after the pandemic. The well-off target audience, including business owners, that could not travel as much is a good example of those that had money to spend on a luxury experience. To be a successful brand to this target market in the luxury sector demands an exceptional brand experience. It is suggested that these people want to show that they can still afford luxury items, despite the economic downturn. Financially insecure people, on the other hand, were less likely to prefer luxury brands after the COVID-19 pandemic. 


A recommended book about luxury branding


Haute Luxury Branding by Philippe Mihailovich is an ebook I have on my laptop that I often refer to when I work with luxury brands. I refer to it in my classes at university. The book provides unique insights that luxury brands can use. 


Positioning luxury brands are different to that of more commercial brands and this book highlights these differences. The Haute Luxe Luxury Pyramid can be used as a guide for the strategic planning of luxury brands and can inform your luxury brand marketing. 


The dangers of overspending on luxury brands


Brands may think it is not their responsibility to guard people against themselves, but brands are expected to be good corporate citizens. 


For consumers, there are dangers associated with overspending on luxury brands. Luxury can become addictive. Once you start spending a lot of money on luxury items, it can be hard to stop. This can lead to financial problems down the road. Another reason why it’s essential to be careful about overspending on luxury brands is that it can cause someone to become more materialistic. 




We’ve all been there. We see a luxury item that we can’t afford and we feel a twinge of jealousy. Why are we attracted to these brands that we can’t always afford? As we’ve seen, much of it has to do with the psychology behind luxury branding. 


Luxury brands are often associated with high social status, which humans are hard-wired to crave. It will be difficult for small businesses but positioning your brand in the luxury market may be a lucrative brand strategy. 


Challenge To You

Do you have a premium brand or a luxury brand? If your brand plays at the top end of the market your brand may be a premium brand or a luxury brand. If your brand does not tick the positioning requirements listed above, then it may be a premium brand rather than a luxury brand.



“I think it takes 30 years to build a luxury brand: – Tamara Mellon, co-founder of luxury footwear brand Jimmy Choo

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Pieter Steenkamp, BrandDoctor


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Meet Dr Pieter Steenkamp, your BRAND FOR SUCCESS guide.

I am actually a brand doctor with a PhD specialising in brand management from University of Stellenbosch Business School. As a brand management lecturer and researcher at a university in Cape Town South Africa and a regular visiting professor at universities in Germany, I stay up to date with the latest brand management developments. This affords me the incredible opportunity to consult with leaders of some of the most admired brands.

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