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Posted: 3 days ago

https://www.afar.com/magazine/can-doctors-prescribe-travel

Should Doctors Be Able to Prescribe Travel?

A movement highlighted by a new Sweden tourism ad campaign encourages doctors to prescribe travel for the health benefits of getting out into nature. Several organizations in North America have put the idea into action.

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Posted: 2 hours ago

https://psyche.co/ideas/how-luxury-brands-engineer-desire-with-behavioural-economics

How luxury brands engineer desire with behavioural economics

by Charlotte Wren, president of the Economics Society at the University of Stirling

From scarcity to market architecture, luxury fashion is manipulating our tastes. But a vintage countermovement has begun

We like to think our tastes are personal; our style and wardrobe hand-picked and self-crafted. But the luxury business model is structured to shape us – through nudges, scarcity, pricing signals and algorithmic machines. Understanding how these factors mould our choices might just help us reclaim a sense of style that’s actually our own.

Luxury shoppers don’t just operate on a different budget but with a totally different mentality. The way they think about money and shoes transcends price tags. Because they aren’t bound by budgets, their choices expose the raw psychology of consumption that influences us all, even in everyday purchases. They have their own stylists and personal shoppers – the whole experience is tailored and hand-picked for them. For the average person, this extravagance is out of reach and out of touch. However, the luxury market no longer targets the ultra-wealthy; as they chase the middle market, they use new strategies and behavioural techniques.

There was once such a thing as couture: ‘old luxury’ for the elite of society. It was identity-defining, scarce, and handcrafted on a small scale. Its key was exclusivity, since the price tag meant nothing to its clientele; what it represented was so much more than price. This phenomenon is known as scarcity.

Old fashion houses used to dote on popes and kings, but with modern capitalism came social mobility, the rise of the middle class and, eventually, lots and lots more people looking to buy luxury. Handmade couture existed in times of real scarcity for such finery, and this helped shape its value. But as high fashion sought to profit from globalisation, it began to target the middle-class market. Luxury has capitalised on people’s desire to give the impression they have more than they’re letting on, buying things that are way outside of their income levels. In fact, the luxury sector is already a $500-billion market as brands strategically offer lower-priced items to attract middle-income shoppers.

Luxury has turned from an art into a mass consumer model, with one thing on the agenda: cutting costs. Cost-cutting in materials has led to what economists call planned obsolescence: clothes that look luxurious but wear out fast, nudging consumers to repurchase. This keeps demand cycling, even without true innovation.

Quality materials have been swapped out for cheaper, lighter synthetics that mimic the look but not the feel. For example, buying a pair of Doc Martens 20 years ago would mean you could still wear them today. I bought a pair just over a year ago for £200, and they now have holes in the leather, and the soles have become dilapidated.

Fashion houses also sought cost savings by offshoring, or moving production abroad. Burberry closed a factory in Wales for one in China; Louis Vuitton moved out of Paris. But this started to change in the early 2000s, with the rise of outsourcing. By the turn of the millennium, Coach had outsourced around 80 per cent of its production, jumping from just 25 per cent in 1998. This shift marks its early move away from in-house manufacturing and towards lower-cost, offshore production. After seeing the success of early adopters of outsourcing, other brands quickly followed suit.

This new middle class, often in the developing world, also showed a desire for luxury goods

Some factories abroad produced to an extremely high standard, but quality issues emerged in others. In Guangzhou in China, workers endure 12-hour shifts, six days a week; some have even died from exhaustion. And what is the effect on the consumer? Lower production costs make luxury seem more accessible, but consumers are now paying for items that are less durable and less ethical.

Globalisation brought numerous benefits: extensive economies of scale and new solutions to old consumer desires. As consumer tastes converged – and a new, global middle class arose – fashion houses innovated. This new middle class, often in the developing world, also showed a desire for luxury goods – and just like that, brands became a symbol of status rather than substance.

For example, Louis Vuitton is now the very definition of mass-produced luxury, and its ubiquitous logos have widespread recognition. The brand pioneered vertical integration, acquiring every stage of its supply chain. Not just for efficiency, but to keep profits in-house. As Dana Thomas writes in Deluxe (2007), Louis Vuitton’s CEO Bernard Arnault ‘and his fellow luxury tycoons have shifted the focus from what the product is to what it represents.’

Vertical integration also brings in a layer of behavioural economics, more specifically, choice architecture. Choice architecture is how consumer options are presented so as to influence and bias (or nudge) certain choices. For example, the conglomerate LVMH owns approximately 22 per cent of the market share, with 75 prestigious brands such as Dior, Fendi, Givenchy and Celine. Consumers are given the illusion of choice between different designers, yet they are all owned by the same company.

Around the same time that luxury brands were globalising their production, they also moved closer to Hollywood to capitalise on celebrity influence and endorsements. This shift became most obvious in the late 1990s and early 2000s. Red carpets became runways and celebrities became billboards for luxury houses, with the likes of Gucci forming partnerships with actresses like Gwyneth Paltrow. There are even stylists who work year-round searching for the perfect garment for their celebrity clients to endorse for one night on the red carpet. This symbiotic relationship makes people tune in to watch, not just to see their favourite actors but also to see who they are wearing. It makes luxury goods feel more accessible to a wider audience, a marketing strategy seen in events like the Met Gala in New York, where brands are able to generate global media buzz. One example this year was Damson Idris wearing Tommy Hilfiger, a genius marketing campaign if ever I’ve seen one.

There is such a thing as anchoring bias, in which an individual’s decisions are overly influenced by the first piece of information they encounter – the cognitive ‘anchor’. In the luxury market, this bias is typically shaped by the high price. Subsequent purchases or assessments of value are then judged against this anchor. Perhaps this is where people’s obsession with Hermès and its Birkin bag come in. With customers having to jump through hoops and spend tens of thousands of dollars before they can get their hands on one, the high price adds a layer of exclusivity, reinforcing the anchor.

Gone are the days of having just the S/S (spring-summer) and A/W (autumn-winter) collections. Now there are releases four to six times a year, with such additions as pre-spring, pre-fall, resort collections and capsule collections. With the push of constant innovation and new collections, brands are nudging buyers into spending more money more frequently. This is known as scarcity marketing.

When luxury symbols become widely replicated, their exclusivity suffers: what we might call status dilution

In economics, the Hotelling model describes how competitors locate themselves close together to share foot traffic and reduce the risk of losing market share. Walk down a high street today and you’ll see it: Prada can be a stone’s throw from Zara, Chanel round the corner from H&M. With high and fast fashion sitting shoulder to shoulder, what once signified wealth and exclusivity is now separated from the mass market by little more than a glass storefront. Psychologically, this uses spatial design to create design pressure (ie, you’re already shopping at another store, you might as well come in here too).

Counterfeiting adds another layer of erosion. You can walk down Canal Street in New York or browse TikTok’s ‘dupe’ economy and find logos that mimic Chanel, Dior or Louis Vuitton – all for a fraction of the price. These copies hurt the profits of the brand but also its prestige. When luxury symbols become widely replicated, their exclusivity suffers: what we might call status dilution. Brands move away from legacy logos to limited drops, using scarcity marketing and influencers to create new forms of prestige.

Before its expansion into the middle market, luxury stood apart from economic cycles. Its ultra-wealthy clientele was unaffected by recessions, and so too were its spending habits. But access to the middle market meant middle-market problems. In the 2008 recession, luxury stocks tumbled, and several brands were forced to close stores, including Versace and Escada, with Escada filing for bankruptcy protection.

Luxury licensing began in the 1960s, when fashion houses offered perfumes as an accessible entry point. Today, licensing extends to hotels, home furnishings, cafés and even logo-covered cakes. The brand, not the craft, has become the product.

With a new age comes a new technology. For years, brands like H&M and Zara have used real-time sales data to detect emerging trends and rapidly deliver new collections. While traditional trend forecasting relied on human analysts and intuition, the emergence of AI has changed the scene. Brands now use AI to proactively predict and program trends by analysing vast datasets. This is done for things such as online search queries, social media posts and consumer behaviour. This allows for consumer desire to be shaped in advance, warping our own tastes. AI is also being used for customer personalisation, a strategy to tailor your shopping experience to your preferences via recommended products or targeted ads when scrolling on social media.

Before planned obsolescence, many clothes would last for years

What this all means is that, in fashion, AI is the new behavioural engineer. It predicts trends, targets ads and reinforces patterns of taste. This can result in a kind of algorithmic confinement, where every media channel is swamped with what customers are most likely to buy, making it harder for them to form their own sense of style or exploration. Yet the opposite could also be true. AI’s ability to present a wider range of options might enable customers to more easily find a unique, original style. But isn’t everyone getting pushed the same ads?

In response, there has been a countermovement in the market with the rise of vintage fashion. Before planned obsolescence, many clothes would last for years. Today, people scour the internet to find vintage clothes that keep their value; in a world where mass distribution and copies proliferate, this also yields more distinctive pieces. Hence the rise of sustainable and preloved fashion and second-hand online marketplaces. For Gen Z consumers who crave authenticity, individuality and quality – things fast luxury can no longer guarantee – Vinted and Depop are the answer, sites where clothes get a new lease of life and contribute to a more circular economy.

Self-expression should be found outside of endless scrolling. But this is hard to do in a digitised world, where it’s easy to get swept up in the latest trends that promote stylistic obsolescence and waste. My tactic is to wait at least a week before I buy something. This micro-habit helps resist impulse purchasing and stops trend-chasing. Another way I avoid tapping into wasteful practices is by being mindful of what materials I am buying. Reflecting and deliberating on your clothes coalesces into a more mindful style, with more unique finds, better fabrics and a clearly cultivated outfit. Not all of us can afford luxury, and maybe that’s not a bad thing.

by Charlotte Wren, president of the Economics Society at the University of Stirling

Charlotte Wren studies economics at the University of Stirling in Scotland, where she is also president of the Economics Society.

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