Rio de Janeiro brand: the opportunities and risks in the luxury sector for the city

Rio de Janeiro is one of the best places in the world nowadays to develop business opportunities. Our city is increasingly attracting more tourists, and future sport events that Rio will host certainly jog many sectors of our economy. The luxury business also increases sharply around the globe, and many studies show the correlation of this sector with the tourism market. Conclusion: Rio has everything to be also “the place” in the global luxury market, what explains international observers from all corners paying attention on us: take a look on the recent issues of Monocle magazine Rio´s cover, increasingly celebrities visits and luxury makes desperate to open their concept stores in the city.

Well, all this scenery is very glamorous, and any adventurer can realize the opportunities that this scenario offers. But there is a big risk in this: the amorphous growth of this market. Take a look in some facts: try typing in Google the expression Rio de Janeiro luxury. It is surprising that in ten links, all of them relate to hotels. Nothing against this sector, but I suppose it´s not the impression that the strategists have thought for this market in the city. Well, what strategists? Here it lies the second trap: there is not a serious discussion, planned and built on what it is this branding “Rio de Janeiro” and it´s impact in the luxury market. The agents of the luxury segment still work isolated, often overwhelmed in the tactical and operational logic, forgetting to plan the long term.

Recently I´ve contacted approximately 70 people in various sectors of Rio society: entrepreneurs, consultants, researchers, journalists, politicians, professionals of fashion, entertainment, hospitality. The result was not very luxurious: I got ten quick and generous praise for the boldness of the idea, three e-mails more elaborated, with critical, and only one, I said one real chat. The conclusion I draw from all this: nobody wants to spend time discussing together a plan of the identity of this brand. In one return I´ve received, the person was quite emphatic: Here in Rio it is the logic of “my business first,” no one wants to open the game with others. That is, on behalf of immediate gains in the short term, one loses the chance to plan a vastly larger gain in the medium and long term. A brief study of planning science deepens what I mean.

This experience shows that people here don´t want (yet) to discuss in an integrated and intelligent vision this market, what are our strengths, weaknesses, opportunities and threats, and strategies to deal with this scenario. This can explain why we still have some problems of poor service in some shopping experiences called “AAA class”. Or the unsuccessful attempt of some Rio´s brands to copy an American luxury, and even European, in the heat of 40 degrees.

It is therefore essential and urgent that we strategists prepare ourselves for the coming mass of people daring to know what Rio has to offer. My hypothesis is that the development of a concept of Rio de Janeiro, concerning a local luxury, using our city history, and its values, can set us apart from the rest of the world, is what will differentiate the luxury market in Rio. This initiative will also support the market after the sport events. In this way, would be defined unique luxury experiences in our city, unable to be played in Paris, Dubai or New York, for example. The ideas are diverse: the customization of European accessories brands with our art and craft, the fusion of international cuisine with local ingredients and seasonings, the identification of a visual identity that values the elements of the city in fashion design and architecture, a “Carioca way of staying”, and so on.

Finally, and perhaps the most important discussion that needs to be done in the luxury sector in the world, is just about the concept of what luxury is, and Rio de Janeiro can even lead this debate in the contemporary thought. Many professionals still confuse luxury with expensive and inaccessible brands. According to dictionaries, luxury can mean magnificence, pomp and splendor, but the concept of luxury that really needs to be discussed in our society nowadays, where even the affection is industrialized, is the sustainable luxury. A concept that values what is sublime: the soul, the excitement, the special, and why not, the simple, that is different from simpleton.

The recent economic crises showed that the capital comes and goes, new brands are created every time, but one thing has not changed, and I imagine that it will never change: the human need humans of being loved, and feel that one belongs to something greater. As we continue looking after this in exhibitionism and frivolity, we might even THINK that we are consuming luxury. But FEEL true luxury is knowing who you are, and “pay the price” of your pains and pleasures. And the best: this can even be the base that will sustain the Rio de Janeiro brand, our “carioca luxury”, perhaps the luxury that the world most needs to remain a good place to live.

Author: André Dametto acts as a management consultant, teacher and executive coach