Setting the stage: luxury in context
The way we perceive luxury has undergone a profound transformation over the past few decades. Historically, luxury was synonymous with aspiration - a set of products or experiences that required saving, planning, and significant financial investment. Owning the latest television, personal computer, or CD player in the 1980s wasn’t just a purchase; it was a milestone that reflected financial success.
Fast forward to today, and luxuries have become more affordable, accessible, and immediate. This shift reflects what economists often describe as the "lipstick effect" - a phenomenon where consumers continue to spend on small indulgences during economic uncertainty. While indulgence has become more attainable, it has also highlighted a stark divide between what we now consider a ‘luxury’ and the soaring costs of life’s necessities.
For many of our clients at Tribe, this change presents a unique opportunity. They are often selling premium, best-in-class versions of everyday products - products that align perfectly with little treat culture. Their audiences are consumers who want to enjoy the finer things in life but are mindful of their spending.
Why are today’s luxuries different from historical norms?
In the 1980s, everyday living was relatively affordable, but luxuries were significantly more expensive. For instance, renting a great apartment might cost just $200 (~£160) a month, but a single television could set you back $1,000 (~£800).
Buying three TVs, a CD player, a personal computer, a microwave, and a cell phone could easily total $8,500 (~£6,800)—equivalent to three and a half years’ rent. These costs made luxuries aspirational and required careful financial planning.
By contrast, in today’s world, rent in a city like London now averages £2,200 per month for a one-bedroom flat (source: Statista), but the cost of comparable luxuries has plummeted. For around £2,400 (~$2,900)—roughly one month's rent—you could buy three televisions, a smartphone, a computer, a microwave, and a streaming subscription. The affordability of these items makes them feel like everyday indulgences rather than the milestones they once were.
The role of little treat culture
With the rising costs of housing, childcare, and education, people have turned to little treat culture to find joy in small, manageable indulgences. These are the moments of gratification that don’t break the bank but still provide a sense of reward—like a premium coffee subscription or an artisanal food product.
Take brands like Bold Bean Co, which elevate something as simple as a jar of beans into a luxury experience. Their high-quality, sustainable food products are a perfect fit for little treat culture, offering consumers indulgence without guilt.
At Tribe, many of our clients operate in this space. Whether it’s premium skincare, eco-friendly home goods, or gourmet food and beverage brands, they understand that their customers are looking for small luxuries that bring delight and quality to their everyday lives.
How do modern luxuries differ across categories?
Modern luxuries vary greatly depending on the category, but they all reflect an evolving consumer mindset:
- Media and SaaS (Software-as-a-Service): Services like Spotify or Netflix represent a shift towards access over ownership. Instead of purchasing CDs or DVDs, consumers subscribe to platforms that deliver unlimited content for a monthly fee.
- Consumer Goods: Products like sustainable groceries or personalised skincare continue to offer ownership, but their appeal often lies in quality and sustainability rather than basic functionality.
- Housing and Necessities: The stark contrast lies here—housing costs have soared to become a significant financial burden, while everyday luxuries have become more affordable. This creates a sharp divide between necessities and indulgences.
Why is community key to modern luxury?
More than ever, successful brands aren’t just selling products—they’re creating communities. Subscription services often include perks like loyalty programmes, curated experiences, or exclusive content that foster a sense of belonging. These efforts elevate small indulgences into lifestyle choices.
For example, membership-based models give customers access to tailored rewards, building long-term loyalty. For more insights on how memberships play a role in modern luxury, see our guide: Membership Programs for Shopify Merchants.
How does this relate to our clients?
At Tribe, we work with brands that embody little treat culture. Whether it’s premium beauty products, sustainable groceries, or artisan homeware, our clients excel at creating products that consumers want to engage with emotionally. These aren’t just items—they’re lifestyle choices that bring moments of joy and connection.
We’ve helped these brands leverage subscription models, personalised memberships, and digital marketing strategies to build stronger customer relationships. The key is understanding that luxury today isn’t about price—it’s about quality, community, and experience.
Final thoughts: Luxuries vs. necessities
The evolution of luxury highlights a profound societal shift. Where luxuries were once aspirational milestones, today they serve as accessible, everyday rewards. At the same time, the rising cost of necessities has created new financial challenges, particularly around housing and education.
Little treat culture provides a way to navigate these pressures, offering moments of joy and indulgence without significant financial strain. For brands, the opportunity lies in combining accessibility with premium experiences to meet the needs of a changing consumer landscape.