Luxury services

Abstract

PurposeThe market for luxury is growing rapidly. While there is a significant body of literature on luxury goods, academic research has largely ignored luxury services. The purpose of this article is to open luxury services as a new field of investigation by developing the theoretical and conceptual underpinnings to build the luxury services literature and show how luxury services differ from both luxury goods and from ordinary (i.e. non-luxury) services.Design/methodology/approachThis paper uses a conceptual approach drawing upon and synthesizing the luxury goods and services marketing literature.FindingsThis article makes three contributions. First, it shows that services are largely missing from the luxury literature, just as the field of luxury is mostly missing from the service literature. Second, it contrasts the key characteristics of services and related consumer behaviors with luxury goods. The service characteristics examined are non-ownership, IHIP (i.e. intangibility, heterogeneity, inseparability, and perishability), the three additional Ps of services marketing (i.e. people, processes, and physical facilities) and the three-stage service consumption model. This article derives implications these characteristics have on luxury. For example, non-ownership increases the importance of psychological ownership, reduces the importance of conspicuous consumption and the risk of counterfeiting. Third, this article defines luxury services as extraordinary hedonic experiences that are exclusive whereby exclusivity can be monetary, social and hedonic in nature, and luxuriousness is jointly determined by objective service features and subjective customer perceptions. Together, these characteristics place a service on a continuum ranging from everyday luxury to elite luxury.Practical implicationsThis article provides suggestions on how firms can enhance psychological ownership of luxury services, manage conspicuous consumption, and use more effectively luxury services' additional types of exclusivity (i.e. social and hedonic exclusivity).Originality/valueThis is the first paper to define luxury services and their characteristics, to apply and link frameworks from the service literature to luxury, and to derive consumer insights from these for research and practice.