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Boston, MA—Experiential luxury now makes up almost 55% of luxury spending, with year-over-year sales of luxury experiences having grown at a rate 50% faster than sales of luxury goods.

According to Luxe Redux: Raising the Bar For Selling of Luxuries, a report from the Boston Consulting Group, this is a clear indication of a shift in consumer behavior at the luxury level. BCG, in conjunction with market research firm Ipsos, surveyed approximately 1,000 affluent consumers in eight developed markets and the BRIC countries, and found that aggregate annual spending on what these consumers describe as “luxury” topped $1.4 trillion. This represents approximately $770 billion spent on luxury experiences, close to $350 billion on luxury automobiles, and the remainder on personal luxury goods, such as jewelry, watches, handbags, and shoes.

Consumers, it seems, now increasingly would rather cherish an experience with friends—intangible as it is—than flash a Cartier watch just because their friends do. While status remains more important in developing economies, its importance as a driver for purchase is declining in the United States and other mature economies. But the importance of value, wellness, and family is increasing.

Four forces are accelerating the trend to experiential luxury, says BCG. The first, and perhaps most powerful, is demographics. In developed economies—including the United States—the consumers who drove the ‘90s luxury boom are beginning to retire, and at a life stage where they don’t need or want to acquire more “things.” Instead, they’d rather have memorable experiences. (BCG is not alone in this finding; other luxury researchers such as Unity Marketing have found the same trend).

Second, says BCG, preferences change as consumers’ lifestyles mature. Newly affluent middle-class consumers initially buy the trappings of luxury in quality material goods, but in time the need is satiated and they begin to move away from acquisition and toward experience.

Third, the Millennial generation—for all its love of luxury brands—is also very experience driven. These are the participants in extreme sports and they’re drawn to instant pleasure and lavish experiences, such as helicopter snowboarding in Alaska or a shopping spree in Paris. While the spree of course includes shopping, the key is in Paris—i.e., the experience of it.

Finally, consumers in the study said they’re seeking a greater sense of purpose and satisfaction, and luxury experiences fill that need more than luxury products do.

What does this mean for luxury jewelers? First, tap into emotion. The age-old reason for buying jewelry--and the best method for selling it--not only still exists, it’s stronger than ever. Michael O’Connor, a noted style expert and fashion commentator, told The Centurion that the biggest trend for bridal jewelry is meaningfulness. This is expressed in a multitude of ways, whether it’s custom design, or incorporating color into an engagement ring in the form of side stones representing the couple’s birthstones, or using a family heirloom stone for an engagement ring. Forevermark’s new fall campaign theme is “The Center of My Universe,” where the popular halo-style engagement ring setting is spun to show the man’s regard for the woman as the center of his personal universe. Naturally, the same trend for emotion holds true for significant gift occasions, as well.

Beyond emotion, what can a jeweler do to turn a purchase into an experience? An outstanding in-store experience is just the starting point—to really captivate a luxury customer, you have to amp up the “wow” factor. Royersford, PA-based Cathy Calhoun, for example, one year arranged a trip for Calhoun Jewelers' six top female customers to meet and take dancing lessons with Maksim Chmerkovskiy from television’s famed program Dancing With the Stars. She rented a limo to take the ladies from her store to Ridgefield NJ, where one of his dance studios is located. She also every year takes over a local old-time movie theater on Oscar night and recreates the red carpet experience for customers to get dressed to the nines and come watch on the big screen as if they were (almost) there.

So instead of running into your best customers at the orchestra, why not buy a season ticket block and take them to the concert instead? Start with cocktails in a nearby restaurant, and end with music. Or, as jeweler Gary Gordon of Oklahoma City’s Samuel Gordon Jewelers did years ago, and Al Molina did at Molina Fine Jewelers in Scottsdale, AZ as well: throw a giant barbecue bash in your parking lot, complete with burgers, beer, and rock ‘n roll. It’s the unexpected that makes you memorable!

Top image: Priceinspector.co.uk