Guy Salter on The Luxury Discernment Curve

Some of the 250-odd partnerships and events at this year’s London Craft Week.

Guy Salter OBE MVO, British luxury guru and founder of GREAT Innovation and London Craft Week, discusses the future of luxury.

Guy Salter OBE MVO, known as ‘Mr Luxury’, represents the British luxury industry in all its facets.

His career spans luxury and retail: from brand development at Sir Philip Green’s Arcadia Group, where he started five new retail brands, to beginning Duchy Originals, a British high-end food brand.

His entry into the luxury industry came with his appointment as managing director of Laurent-Perrier Champagne, and he subsequently became CEO of Asprey Group, Britain’s oldest luxury business.

His pro bono work includes 15 years leading Walpole, which represents the British luxury industry. Nine years ago he founded Crafted, a mentorship programme to provide commercial advice to outstanding craftsmen and women. In addition, he sits on the GREAT Programme Board that runs the British government’s GREAT campaign and is chairman of the GREAT Festivals of Creativity. In 2015 he founded London Craft Week, the fourth edition of which runs next month from 9-13 May, bringing together 250 events and shows all over the capital.

Salter shares with Billionaire his thoughts on the future of luxury.

How has luxury evolved over the last 100-odd years?
Around 15 years ago I commissioned some research into what I call the discernment curve. Before the recent financial crisis when luxury was riding high, I started to feel worried because I felt luxury was becoming hackneyed and superficial, losing touch with the things that made it special in the first place — an understanding of materials and creativity.

The discernment curve is thus: if you look back 120 years, the pool of luxury buyers was much smaller and they were highly discerning; the relationship between them and luxury brands was more equal as it was as much about their taste and ideas as it was about the house’s. Back then you had high levels of discernment but low levels of wealth.

But after the Second World War, when wealth started to increase and the baby boomers had more disposable income, you have masses of people with enough money to buy beautiful things with very low levels of discernment. That was the magic moment, business wise, for the luxury sector, as companies realised that if a brand did enough signposting and spent enough on marketing, people would buy into it.

My whole argument was that, sooner or later, discernment would grow stronger than wealth. And it has and is. People are making their own decisions based on their own knowledge. The winners of the future will be the brands that can appeal to discerning buyers. The brands that forget this will be threatened. I always say to brands don’t forget the luxury basics: creativity, craftsmanship and technology.

What does London Craft Week have to do with this?
London Craft Week was an attempt to test my theory. On the one hand you’ve got consumers who are, frankly, bored — they see the same brands in the same shopping malls everywhere they go in the world. Second, they’re hungry for new, small local things that are made by real people with integrity. Conventional retail does not present you with those things in a shopping mall.

The really heartening thing is that for the last 10 years I’ve noticed an explosion of talent. Young designers, new brands, artists, cooperatives, little galleries and so on. This renaissance of talent should be fulfilling this need, but it is not quite. Partly because it is hard to get your head around; partly because of trust levels. Also, you don’t want to look stupid by falling in love with a local story and find out the quality is not there.

London Craft Week is like a shopping experience of the future for discerning affluent individuals. You have the famous brands who still have their creativity, mixed up with the unknown stuff in a curated way. For example, Rolls-Royce or Chanel sitting side by side with a 300-year-old glass-blower or an exquisite Japanese ceramicist. We open up famous buildings that people don’t usually have access to, such as The Royal Mews, 10 Downing Street or the upper part of The Shard, and we tell the story of the talent behind those places. It’s a cultural experience, as well as a shopping experience, with a sense of discovery. Our visitor numbers tripled last year, so we’re onto something.

Are there any societies that encapsulate this idea of discernment?
The real future is mass discernment. The nearest equivalent is Japan where almost everyone has an affinity for culture and beautiful things, not just the rich. People are applying taste to their purchasing at a much higher level in terms of artistic sensibility. Luxury becomes more intelligent and less of a superficial transaction. Japan has been one of the most important markets for luxury for 40 years, for all the big names, but it is also a society with an affinity to quality and things that are simply special. There’s a much more sophisticated approach to life. Luxury in the future will not be a matter of buying expensive things, it will be how people live their lives in a beautiful and harmonious way.

For more information visit London Craft Week.

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