WALL STREET JOURNAL | CARL BAILIK
My print column examines the hundreds of products that claim to be the most expensive of their kind. Some achieve this by defining narrow categories, by piling on the gold and diamond embellishments, or by setting a high price that no one steps up to pay.
“I think it’s all about publicity,” said Martin K. Sneider, adjunct professor of marketing at Washington University’s Olin Business School in St. Louis, “either for the seller or the buyer or both.”
Much of the publicity seems to originate from the U.K., where many of these products are offered for sale, then covered in the newspapers. “There’s a lot of international money there,” Sneider said of London.
At Lindeth Howe Country House Hotel and Restaurant in Bowness-on-Windermere, U.K., which this week sold a chocolate dessert for $34,000 and is applying for Guinness World Records recognition, “The appeal to us was never making money as we are selling the dessert at a price that makes us very little profit,” Mark Abbott, business development executive for Lindeth Howe, wrote in an email. “We do however gain the publicity.”
As for the U.K.’s predilection for such superlatives, Abbott said, “I think with the situation in the economy and other things going on in the U.K., the U.K. public like ‘good news’ or ‘happy news’ and the media pick up on these stories, to counter-balance the negative stories. I also think that rich individuals in the U.K. like to show off their money and it is aimed at them. I think it can be an aspirational product.” And even in these tough economic times, there are enough buyers, especially for products with a very limited production run. “People will enough money to buy something like this, don’t get too affected by the recession as they have enough money,” Abbott said.
Other most-expensive candidates are no longer available. In 2007, the Westin New York offered a $1,000 bagel with white-truffle cream cheese, but it isn’t on the menu today. “The bagel was launched in a different economic climate, before the recession hit, and is no longer offered, so the hotel cannot speak to whether it’s a tougher sell in the current economy,” a spokeswoman for the Westin wrote in an email. “However, interest continues to be very strong from a media perspective, which suggests that consumers are still interested in hearing about exclusive, luxury-type products.”
“Even in these tough economic times, we have found that the people who had plenty of money still have plenty of money to spend,” Rob Bruce, spokesman for Whyte & Mackay, wrote in an email. Whyte & Mackay owns the Dalmore distillery, and a bottle of Dalmore 62 sold for a record price two months ago. “They are maybe being less ostentatious and less high profile with their buying behavior. For example, the buyer of the Dalmore 62 was adamant he wanted his identity protected which we duly did. But they are still enjoying the best luxury products money can buy.” Bruce added, “Buyers of these products have a raft of different reasons for purchasing them. To treat themselves. To invest and make money. To show off. To indulge in a passion or hobby. To taste history in a glass.”
The motivation isn’t always, or often, practical. A diamond-and-platinum bikini designed by New Hope, Pa. artist Susan Rosen for Sports Illustrated swimsuit model Molly Sims in 2006 was given a price tag of $30 million and has been labeled by many articles as the world’s most expensive bikini. Yet any wearer would find she hadn’t gotten much surface area per dollar. “I don’t think she expected it to be that small,” Rosen says of Sims, though Rosen added, “It’s racy but it’s not obscene.”
If she were brainstorming a special swimsuit this year, Ms. Rosen isn’t sure she’d go for something so opulent, but she noted that interest in the bikini, from the media and blogs, has remained high.
“Time doesn’t go any faster or slower because I spent $50,000 on a watch,” said Marshal Cohen, chief retail analyst at the NPD Group in Port Washington, N.Y. “But time can be more enjoyable to a person because they have a watch no one else has, or can eat a dessert no one else has, or can drive a car that you can feed a country with the value of.”
Cohen suggested one way to marry that phenomenon with today’s consumer’s hunger for deals: A Groupon or other social coupon offering, say, half price on menu items at the restaurant that offers the most-expensive version of a certain food item: “Experience a piece of luxury at a price anyone can afford” is the tagline he suggested.
Charles A. LaCalle, a retail analyst with Robert Burke Associates, agreed that the very expensive item could make less expensive wares alongside it seem downright reasonable. He mentioned a company that introduced an expensive backpack made of alligator. If it makes just a few and sells out, “the effect on consumers is significant,” LaCalle said. “Now, customers can buy a $1000 shirt from their line and feel like they are getting a bargain.”
Cohen added, “Luxury no matter what is something that in good times and bad still resonates with people. Even in our hungriest and darkest of days, we still want luxuries we can no longer get.”