Have you ever heard about collaborative luxury consumption?
Collaborative luxury consumption shows us a transformation of consumers' attitudes towards luxury
Collaborative luxury consumption is a phenomenon that has become increasingly popular in recent years. Owning new goods is not the only way for consumers to experience luxury, with an increasing number of people preferring rental models or buying ‘preloved’ second-hand items.
What does collaborative consumption mean?
Collaborative consumption is an economic model based on the exchange and sharing of material goods, services, or knowledge and is often linked to the concept of sharing economy.
Made popular in other sectors such as transport (Uber) or hospitality (Airbnb), it is making inroads in the fashion and accessories sector.
The merits of collaborative consumption are different.
First of all, it is an accessible form of consumption, as it allows consumers to obtain goods and services more easily and at a lower price. At the same time, it improves the use of resources and reduces waste. In other words, it is more sustainable.
As we can see, collaborative consumption represents a new approach to the consumption of goods and services, in contrast to the traditional consumerist capitalist economy.
If previously producers, sellers, and suppliers offered goods and services to an audience of passive consumers, now the latter become active and can themselves be sellers and suppliers. It is a model that places less importance on private property in favour of the distribution of resources.
In general, the collaborative model includes bartering, sharing, lending, leasing and renting. By extension, it also includes the sale of second-hand and vintage products.
Reasons behind traditional luxury consumption and collaborative luxury consumption
What drives people to buy luxury goods?
Some of the main reasons are:
- social status,
- social pressures,
- product quality,
- investment for the future,
- gifts for special occasions,
- impulse purchases.
At present, there aren’t enough official studies that explain what drives the consumption of luxury goods on a collaborative basis. However, we know that some of the aforementioned values remain valid, while new ones are added, such as, for example, the desire to do good to the planet and the community, the abandonment of an individualistic vision in favour of a collectivistic one, the idea that social status can be expressed through "use" instead of "property".
In general, consumers are re-evaluating priorities and, as a result, their attitude towards luxury is changing.
As an example, it is worth mentioning some of the reasons why consumers prefer to rent luxury fashion items instead of buying them:
- the need to have a new dress (or accessory) for a single special event (e.g. wedding, cultural event);
- the curiosity to try a new way to consume luxury goods at affordable prices;
- the desire to make more sustainable choices (increase the life cycle of the product, reduce waste).
In conclusion, collaborative luxury consumption seems to depend on motivations concerning both the product and the experience. The former has to do with the quality of the good, while the latter refers to the social and environmental aspects connected to its use.
How does it work?
Collaborative luxury consumption is mainly based on online platforms that allow users to rent or borrow items from other users. In this way, they can enjoy the luxury of wearing designer clothes and accessories without having to buy them. However, some luxury brands themselves have started offering their products and services through similar online platforms. This is in line with the trend of collaborative consumption, as it allows consumers to have access to luxury goods and services at a lower price.
Why is collaborative consumption good for the fashion industry?
As already mentioned, the academic literature does not yet offer us enough data on the actual impact of collaborative consumption platforms on the fashion industry. However, we can deduce a few things:
- collaborative consumption favours a more efficient use of resources and reduces costs.
Usually, these results can be obtained with economies of scale, i.e. with an increase in production. Instead, brands can now get new revenue from selling or renting their used products. In 2019 it was estimated that reselling in fashion will increase 5 times in the next few years, while the online fashion rental market was valued at $ 1,013 million in 2017. Forecasts say that the global shared apparel market will come to worth $7 billion in 2025.
To derive the greatest benefit, fashion and luxury brands can adopt tools that allow both the brand and consumers to track products and verify their authenticity, such as the Certilogo secure digital ID platform.
- the fashion industry plays an important role in the global economy but has a heavy environmental impact.
It employs more than 300 million workers worldwide who generate more than a trillion dollars in value. In the last decade, production has almost doubled, causing excessive consumption and halving the life cycle of products. Furthermore, most companies still follow a linear business model, from production to landfill. All this represents a huge challenge to the sustainability of the sector.
The sharing economy helps reducing the environmental footprint of the fashion industry in two ways. First, companies are no longer forced to continually produce new items and can leverage existing ones. Then, second-hand and rental extend the life cycle of products and reduce fashion consumption and, therefore, waste.