The richness of Italy—its food, culture, language and commerce—has inspired thousands of much more gifted, eloquent writers over the years. Indeed, Italy has long been regarded as the epitome of luxury. This notion has also had a major impact on Italian businesses and goods. Companies such as Armani, Prada, Gucci, Dolce & Gabbana and Maserati drip of lavishness and point to how the Italian economy has grown around many of these family-owned companies that cater to the whims of the world’s elite.
In January 2007, a group of nearly 20 Columbia Business School students set out to experience the many facets of Italian life, business and, yes, wine. The students traveled to Milan, Maranello and Rome, meeting with senior executives at some of the most recognizable brand names and learning about Italian business culture and what it means to live, breathe and sell luxury.
While luxury itself does not require or necessarily equate with scarcity or inaccessibility, many of the companies visited believe that their positioning depends upon their limited availability. Some high-end Italian producers are defining to whom they won’t sell before deciding to whom they will.
Armani, for example, has bucked a trend among many high-end fashion houses of targeting the accessories market instead of the clothing market. The accessories market, which has grown substantially and profitably over the past few years, tends to be an entry point for consumers looking to explore higher-end goods.
However, even as Armani has expanded its product line to include home furnishings, hotels and even floral arrangements, it remains true to its roots as a luxury clothier. The company has chosen to distinguish itself with multitiered offerings that coincide with different price points and styles. Armani Jeans and its American counterpart, Armani Exchange, are geared toward a different consumer than the more expensive Emporio Armani, and while all are manufactured with quality, none bears the exclusivity of the Armani Collection.