THE NEW ELITE


 

There’s a new elite class defined by cultural capital rather than by income bracket, people who practice inconspicuous consumption, finding value not in flashy cars but in buying organic food, taking yoga classes and investing in their children’s education.

By making wise decisions about education, health, parenting and retirement, this aspirational class reproduces wealth and deepens an ever-widening class divide, according to USC Price School of Public Policy Professor Elizabeth Currid-Halkett, holder of the James Irvine Chair in Urban and Regional Planning.

The professor has spent a lot of time researching the production of culture. She offered data-driven analysis in her first two books: The Warhol Economy, which studied the production of art and fashion, and Starstruck, an exploration of Hollywood and celebrity.

Her new book, The Sum of Small Things: A Theory of the Aspirational Class, looks at the consumption side of culture and material goods. It launched in New York City this month with a book signing and talk that benefited the HIV/AIDS services of the Housing Works Bookstore Cafe.

At the book launch, the professor discussed the source of her inspiration.

Currid-Halkett said she saw consumers glomming onto certain types of goods, noticing even on a trip abroad that supermarkets had sections filled with gluten-free food and almond butter. Drawing from the famous work of Thorstein Veblen and his study of the elites in the 19th century, she decided to gather data and delve into the meaning behind these consumer patterns to understand differences in how elites spend today.

“In a capitalist society, we’re always finding ways to signify our place in the pecking order — the handbag doesn’t do it anymore,” Currid-Halkett said.

She traced the history of consumers’ shift in focus from material goods to nonmaterial goods, explaining that, until the Industrial Revolution brought plentiful new products, it was hard to get your hands on luxury material goods.

Today, we live in an era when material goods are abundant and easy to obtain.

At the same time, as consumers, we’re now aware of the labor exploitation and environmental consequences associated with the manufacturing of material goods, which has given many consumers pause.

“They not only have lost their specialness — because there’s a lot of them — there’s a human and environmental cost to those things,” Currid-Halkett said.

“Upper-income groups spend less on material goods and more on inconspicuous consumption. Material goods are omnipresent, and that makes them less valuable,” she explained.

Currid-Halkett pointed out that many of these consumer decisions are positive: It’s good to buy pasture-raised eggs and care about your children’s education. Part of what defines today’s elite is money, but the other part is the knowledge about where to spend it.

“The luxury to know that those are good choices reveals status,” she said.

The phenomenon is most salient in what Currid-Halkett referred to as “the ground zero of parenting: motherhood in urban centers.” She joked that mothers don’t eat all that kale or breastfeed their children for two years simply because it’s fun. These subtle choices are visible to peers, and they confer status and a sense of belonging to the group. They also suggest having time and money. Good maternity leave, partners with good salaries and good medical care give women the opportunity to breastfeed and as such reveal socioeconomic position.

Currid-Halkett noted that she went into the research for The Sum of Small Things without preconceptions. She said the biggest surprise was discovering that nonmaterial things were much more defining of class than material goods were.

“If you talk about income groups,” she concluded, “the elites are dumping tons and tons of money into things we can’t see.” But as she writes in her book, this inconspicuous consumption is how privilege is reproduced and inequality becomes a deeper problem in society.

The performance of the fitness industry tends to be cyclical. That’s true for workouts, and it’s true for diets. This is a space where things may come and go, and trends may disappear entirely. You can probably think of examples: Jazzercise and Tae Bo and a continual stream of short-lived at-home fitness products—the kinds typically sold on infomercials. Some workouts just repeat the same thing again and again; fatigue, boredom, or distraction sets in, and people decide to try something new.

Smart studios don’t think of themselves as a fitness company; they’re a player in the broader experiential economy. The smartest decisions come from understanding and connecting with customers. The best testing ground for growth is within the walls of mirrored studios. Smart studios recruit and train their instructors quite differently from the way other fitness companies do, for one major reason: Their role is crucial to their riders’ experience. Their instructors are inspirational coaches who leave riders more empowered on their bikes and in their lives. Smart studios count on them to make every class unique, to localize the experience, and to connect with different demographic groups. Smart studios count on them to inspire in hundreds of thousands of riders every month.

Smart studios also differ from traditional fitness classes in the way people value the experience. At a gym you can take unlimited spinning classes as part of a basic membership. Smart studios don’t charge monthly fees, but each class costs around $30, and they ask their riders to book bikes in advance. Smart studios believe the pay-per-class model inspires a different level of energy and commitment that contributes to the overall experience.

Calories burned is just a piece of what we deliver to our riders. Measurability matters, but we’ve heard repeatedly that our team is what keeps riders coming back. Smart studios use behavioral interviewing and on-the-job shadowing to ensure that our teams are motivated to make the time a rider spends at one of our studios the best part of the day. It’s simple but intuitive: Inspired people want to encourage inspiration in others.

Smart studios instructors are their greatest asset. They take riders on a 45-minute physical, emotional, and musical journey that’s similar to theater. You could take a class with the same instructor multiple times in a week, and each experience would be different. Autopilot isn’t an option. Lighting, playlists, words of encouragement—everything is customized in real time to the group of riders in the room. The one constant is the incredible physical challenge.

To recruit superstar instructors, smart studios prioritize great personality and individual expression—their training program will fill in any Spinning-specific gaps. To retain those stars, their model values career trajectory. Smart studios pay above-market wages, and 78% of their instructors work full-time, with health insurance, paid vacations, and continuing education, which is very unusual in this industry. They also have free access to on-staff physical therapists. Their retention rate over the past few years has exceeded 95%. They get about 20 applications for each opening in their training program. Instructors go through a rigorous 12-week training at headquarters, where they learn everything from the elements of the workout to musicality to anatomy and biomechanics. Once they’re on the podium, smart studios invest considerably in further training and development. Because smart studios are a growth company, they see how they can build careers by relocating to new markets, growing into regional development roles, or through promotion.

Some of the best lessons come from outside the industry. Smart studios consider how Disney trains its staff and how Starbucks keeps its stores community oriented. Smart studios watch how Airbnb adds digital products while remaining intuitive. Smart studio enthusiasts will tell you that it’s not just one or two things that make smart studios unique—it’s the combination of many. It’s the welcoming attitude of the staff, the charisma of their instructors on the podium, their clothing collection, and their attitude. It’s difficult for imitators to copy any of that, let alone all of it.

It’s never been part of their strategy, but they’ve attracted an influential clientele, especially in New York and Los Angeles. Some people think that relying on celebrities to create buzz is its own form of faddishness. There’s no question that celebrities have brought smart studios attention, but they don’t do anything special to bring them in. From what we hear, high-profile customers appreciate that they can ride in a community setting and that instructors will never draw attention to them.

Choosing the right location for a new studio is a science, and smart studios begin their research a year before they hope to break ground. There’s no substitute for spending time locally and hearing from future riders what matters to them. What do they do with their free time? Where do they exercise and when? What gets them out of bed early? By understanding their lifestyles, smart studios can build a studio around them—not the other way around. And, of course, smart studios consider which of their instructors can best help build community in a new market.

When it comes to innovation, smart studios do some things you might expect. They’re always looking to improve the design of their studios, which some people have compared to Apple stores. For instance, smart studios put iPhone chargers inside the lockers, because the charging stations they used to offer at the front desk were getting crowded. Smart studios have super-bikes, which use magnetic resistance and a carbon belt drivetrain. They’re superior to usual bikes, which use friction-style resistance: They ride more smoothly, and they last longer. Smart studios redesigned the handlebars to accommodate their choreography and to provide greater stability for the upper-body workouts they do on the bikes. And their workout continues to evolve as their riders become stronger. Today their instructors utilize more interval training in their classes, and their hand weights are heavier than they were a few years ago.

Smart studios are confident that they’ll keep growing, because people are looking for places to connect with one another and disconnect from technology. They want experiences more than they want stuff. The reason so many wellness categories are growing is that people recognize the importance of investing in their bodies and their minds. That’s why they believe that they are not as sensitive to the economy as some other premium brands are. Transitions have proved to be times when their brand is acutely relevant to their customers.

Simply put, they’re not a fad. Indoor cycling has been around for more than 30 years because it’s a safe and efficient way to get a cardio workout. It’s easier on the joints than many other forms of exercise, so riders can stay with us for years. Smart studios took this old form of exercise and reinvented it as a full-body workout with emotional and mental benefits that go far beyond fitness. Friendships and communities are enduring. Because smart studios have those elements at their core, their brand will endure too.

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