Let Them Wear Diamond-Cut Bracelets

By Lionel Beehner

A pair of bracelets worn by Marie Antoinette just sold at an auction for over $8 million to an anonymous bidder, twice what was expected. A prototype of one of Steve Jobs’ original Apple-1 computers just auctioned for $400,000. And an original copy of the U.S. Constitution was sold to an unknown bidder for $43.2 million.

These sales may portend a new era of high-end luxury retail. What they all have in common is the unique origin story behind the items for sale. In a world crawling with millionaires and billionaires, virtually anybody can afford a high-end mainframe computer or a pair of vintage diamond-cut bracelets. What the leisurely class today seeks is heritage, some piece of history they can own and flaunt before their peers at cocktail parties.

In a recent interview, the private equity billionaire David Rubenstein waxed historian-like about his 1297 copy of the Magna Carta — one of four in existence. Likewise, the Apple-1 motherboard is likened to the “holy grail of vintage computer collecting” because of its casing made from koa wood (one of only six in existence, made rarer because of logging and cattle grazing) and is the product that kickstarted Apple.

This is not a new trend of course. Yet in today’s world, where scarcity is decreasing yet status-consciousness is increasing due to the fishbowl effect of social media, what are billionaires to do to distinguish themselves from the rabble of millionaires that envy and seek to emulate their elevated status? Even a trip into outer orbit will only set someone back $250,000. When anyone can afford the latest designer bag or stylized piece of Danish furniture, it becomes trashy and commonplace.

At the same time, after over a year of lockdowns and social media blowback against celebrities for taking selfies while sequestered on their private island, there is concern that status is becoming democratized, that conspicuous consumption among the wealthy is gauche. Robin Leach’s 1980s show “Lifestyles of the Rich and Famous” would hardly find a following among today’s socially conscientious GenZ viewers.

Yet the vast accumulation of wealth at the top never seems to yield. Nor does the social desire to distinguish one’s status among their closest peers. Thanks to vast increases in wealth in China, there are now 3,000 billionaires alive today, an increase of over 600 in the past year alone. Globally there are 47 million millionaires; half of them live in the US.

What’s ironic about the current era, especially given society’s concern with widening financial inequality, is it has never been easier to emulate the superrich. The explosion in cheap credit and growing disposable income since the financial crisis has put many of the traditional trappings of the super-wealthy within the reach of a broader cross-section of men — and especially women. Yet at the same time, while more people are becoming wealthier, the scarcity value of many material goods associated with the rich, from handbags to yachts to driverless cars, is rapidly falling.

The whole model of luxury has been a consumerist way to provide the upper middle classes access to an aspirational lifestyle of the highest echelon of wealth. What billionaires do in their spare time or how they flaunt their wealth only matters insofar as their behaviour sets the trend for what is aspirational for all the millionaires looking to move up the ranks.

Art, too, has become more democratized as galleries and museums become more inclusive, and as technology enables almost any of the world’s richest to hang a Basquiet on their wall or own an NFT. Mass media has put specialised knowledge in virtually everyone’s hands, challenging the exclusivity of subjects like Bauhaus design or fine Bordeaux. In the world of work, the vibe established by West Coast tech companies has killed off the traditional bespoke suit as a class-identifier, and social media platforms now offer a global stage on which to build your personal profile — for free. The de jour WFH outfit of the pandemic was a signature monochrome Entireworld sweatsuit one could purchase for $176.

Certain experiences are now wealth and status-agnostic. To take an oft-cited example, women of all wealth and social strata will attend yoga classes dressed similarly (though Madonna may attend a more exclusive yoga studio than you do). Ostentatious galas are out. The anti-consumerist movement was accelerated by a pandemic year that saw inequality soar yet displays of “conspicuous consumption” go out of fashion. We’ve seen a backlash against influencers enjoying freedoms unavailable to others that has made the super-rich wary of flaunting their wealth — or at least flaunting it in more subtle ways.

That has not stopped speculation that we are entering into a decade of hedonistic indulgence, a return of the roaring twenties, only now one that is on Instagram. Even still, luxury goods manufacturers are keen to understand whether the superrich will revert to previous spending habits or if things are changing. Last year, for instance, the luxury goods industry lost $79 billion in sales. And Princeton’s Peter Singer predicts that in 50 years, the conspicuous consumption of previous generations of elite will be unthinkable.

The dazzling watches or sleek yachts of previous decades will be replaced by something less attainable and less “conspicuous” — goods with a history and cultural cache. Luxury will be defined not by what something is made of or who made it, but how it came into provenance.

A unique origin story is both harder to replicate but easier to position the owner within a class or cultural elite in which they are custodians as much as owners — whether it is of obscure knowledge or material possessions. The sociologist Elizabeth Currid-Halkett calls this the “aspirational class.”

In short, the age of the Veblen good may be over. What comes next is unclear, but the space odysseys of billionaires or the auctions of Apple mainframes signal a luxury industry both in disarray and in flux: the need for something immaterial, rare, and experiential to signal one’s social status.

Perhaps this explains the resurgence of auction houses and antiques for millennials in the wake of the pandemic, as well as the surging demand for ‘goods’ that reflect different (or radical) ideologies, from obscure NFTs to the billionaire Peter Thiel’s recently inaugurated anti-woke “University of Austin.”

In a world where scarcity is shrinking, the hardest thing to replicate is the story or idea itself.

Read also the article on our Medium page here.

Lionel Beehner, PhD, is the director of thought leadership at ReD Associates.

[Banner image by Roman Kraft, via Unsplash]