8 p's of luxury branding

7/29/2019 8 p's of luxury branding

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8 Ps of Luxury Brand Marketing

I think every girl deep inside dreams about having the money to be able to buy the Louis Vuitton

bag

or being at the red carpet herself and wear a beautiful Chanel dress - Qualitative research, UAE,

2010.

Luxury brands have always been a fascinating space and luxury brand marketing one of the mostcomplicated ones.

So, going by the above consumer quote, this paper attempts to decode what makes Louis Vuitton,

Louis Vuitton;

Chanel, Chanel in simple words what makes a luxury brand desirable? What are the

ingredients/components that

make up a luxury brand?

Is it the physical / functional attributes like the product quality, craftsmanship, design, technology?

As one

respondent in one of the qualitative research in UAE said When you buy something with really high-

quality, you

can genuinely feel the difference. It is in the touch, the feel of the material; its in the smoothness,its in its minute

details...

Or is it the self-asserting emotional stimulation of letting the others know that Ive arrived & I have a

penchant for

finer things in life not common to many? A respondent said I bought my BMW, just to keep my key

on the table

during the meeting. Another respondent said If I stop at a signal I feel I will attract attention of

people.

Or is it that luxury brands are just the stepladder to move to the right circle or an appropriate thing

to have or wear

in that circle? A respondent said There is a proverb which says if you wear nice shoes you enter niceplace.

3 MOTIVATIONS - SELF ASSERTION, DIFFERENTIATION AND GENUINE APPRECIATION FOR PRODUCT

EXCELLENCE:

In my assessment, by-and-large the above are the three major motivators that drive people to desire

and acquire

luxury brands. That said, its important to acknowledge that they are not mutually exclusive.

Exclusivity has always been connected to luxury brands. But from the consumers perspective the

definition of

exclusivity goes through an evolution. At the early stage, having the ability or affluence to own a

luxury brand

desirable and recognizable by everyone is exclusivity. It is a means by which consumers assertthemselves - whether

it is to fit-in or simply to make a statement.

As the consumer moves on and with more people joining the ownership circle, just owning a

recognizable symbol

is not enoughthe new need to differentiate sets in to further confirm their social status and to

stand-out among

the equals. The source of exclusivity, then, can manifest in form of acquiring limited editions or

something with

extraordinary product capabilities or rare materials, craftsmanship; it can also be driven by brands

distinctive

personality or simply the knowledge of the brand legacy. One can also observe that people who seek

differentiation


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wristwatch. Along with a

unique column wheel

chronograph movement,

the day and month appear

in a double window at 12

oclock, with a handindicating the date around

the moon phase. The leap

year is displayed in a small

round window at 4:30

opposite a matching

window for the day/night display at 7:30.

Like all the brands grand complications, it has two

interchangeable backs - one in sapphire crystal that

reveals the movement complexity and the elegance of

its finishing, the other, a white gold solid back that can

be personalized with a dedication or an engraving.Omega Speedmaster Chronograph the moon watch:

Selection by NASA, a walk

in space in 1965 and since

1969 six mission to the

moon is what makes this

series with extraordinary

capabilities. After it

became a life-saving

instrument during the

Apollo 13 mission, the

Speedmaster went on tobecome a symbol of peace,

as both American & Soviet

astronauts wore it in the

first joint space-mission

during the cold war. It

never left the Space

Program as it still the only

watch certified by NASA for

all EVAs (Extra-Vehicular

Activities).

A luxury brand must perform at an experiential level as well, i.e. the emotional value of the brand

the consumers

buy into beyond what the product is to what it represents. For example: Rolex stands of symbol of

heroic

achievement & Tiffany is a symbol of love and beauty.PEDIGREE:

Many luxury brands have a rich pedigree and extraordinary history that turn in to an inseparable

part of the brands

mystique. This mystique is generally built around the exceptional legendary founder character of the

past, making

up an integral part of the brand story and brand personality.

So, when consumers buy say a Cartier or a Chanel product - it is not only because of the product

performance


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factor, but subconsciously they are also influenced by the brands rich lineage, heritage and the

years of mastery.

Coco Chanel started her business in

1913 and within a few decades,

became a revolutionary couturier.

Karl Lagerfeld took the helmin the 1980s and has been

modernizing the brand ever

since.

With Chanel Coco Mademoiselle campaigns

in 1981, 2008, 2009 & the recent 2011,

Chanel has continuously leveraged its

pedigree / brand mystique.

Gucci opened the doors of its own museum in Florence to

mark the completion of the house's 90th-anniversary

celebration.

Similarly, Rolls-Royce celebrated the 100th anniversary of itsiconic emblem, the Spirit of Ecstasy with '100 cars for 100 years'

and featured a collection of Rolls-Royce models, supplied by

members of the Rolls-Royce Enthusiasts' Club, dating back to 1911

PAUCITY:

Over-revelation-and-distribution of luxury brand can cause dilution of luxury character, hence many

brands try to

maintain the perception that the goods are scarce. Case in point - Burberry diluted its brand image in

the UK in the

early 2000s by over-licensing its brand, thus reducing its image as a brand whose products were

consumed only by

the elite. Gucci, now largely sold in directly-owned stores, following a nearly crippling attempt towidely license

their brand in the 1970s and 1980s.

Broadly, theres natural paucity (the actual scarcity), the technology-led paucity and the tactical-

driven paucity.

Natural paucity is triggered by scarce ingredients like platinum, diamonds, etc. and/or those goods

that require

exceptional human expertise, for example handcrafted quality that constraints the mass

production.Technology-driven paucity is as a result of conception-time involved in continuous

innovation and research-&-

development process.

Tactical- driven paucity are more promotional in nature such as the limited editions or the special

series to

generate artificial desire and demand. Another deviation within this is the customization of luxury

good, e.g. Garson

USA custom made a diamond-encrusted Mercedes SL600 for Prince Al-Waleed bin Talal of Saudi

Arabia in 2007.

PERSONA:

The persona of a luxury brand is largely a result of first, its distinctive projection plus coherence of

its applications

across consumer touch-points and second, the brand communication through its advertising.

The visual brand identity captures the brands personality, mystique & emotional values in a

nutshell. The distinct


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and consistent orchestration of the identity is central to establishing the visibility, familiarity &

common identifiable

brand imagery. The visual brand orchestration can manifest by way of its coherent application of its

identity, the

brand color(s), the other design elements like icons, the uniquely identifiable design, branded

environment andeven the tone-of-voice.While the luxury brands visual identity is a fairly stable factor, luxury brand

advertising is a more dynamic and

versatile marketing vehicle. While the pedigree of the brand has its role, keeping-up the

contemporary-appeal and

the newness-factor is crucial for enduring brand relevance. Therefore, luxury advertising not only

needs to generate

the desire for the seasonal collection, but at the same time it must also enhance the brands cool-

quotient, thereby

making it continuously desirable and aspirational.

At an overall level, luxury advertising messages can be

observed:and sensual to distance it

from mass-premium brands

exceptional to their brand signature

Generate major differentiation in its production

and execution

One of the relatively new trends within luxury brand communication is the use of the long-form-

commercials or the

short-film-videos to generate interest with the online audience. It is clearly a pursuit where luxury

brands are

looking to bridge the gap between the familiar world of print and the fast-evolving world of online. Ithas also

proved impactful as in a matter of few minutes, the viewer can have a clear understanding of the

brand image or

the story the brand is trying to convey or simply promotion of the new collection.

The short-flash-videos at Montblanc

website focuses on its craftsmanship legacy:

http://bit.ly/uiSQ8F

Louis Vuitton created a 3-minute

thematic video for its journey

campaign.

http://youtu.be/NQlueM5ETYU

A one-and-half minute video by Tiffany

& Co. focuses on promoting gifting

during holidays.

http://youtu.be/BacfKM3876gApart from these, with the intent of enhancing the emotional

connections with discerning mindsets, luxury brands

have been exploring the digital space by engaging them in their activation programs. The objective is

to generate a

genuine affinity with the brand that transcends beyond the product, to an extent where, the

consumers feel that

they have found a soul mate.

With the objective of strengthening the brands association to

love and romance Tiffany & co. launched


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whatmakeslovetrue.com and iPhone app as a guide to those

who want to take their romantic relationship forward. The

website also showcases select true love stories of real people

to give that personal touch.

In line with its brand essence of symbol of heroic

achievement, each year rolexawards.com showcasespioneering projects of real people that demonstrated

innovative thought and betterment of human-kind. Thereby,

establishing a personal affinity with their audience, beyond

celebrity endorsement.

Some of the luxury brands have also utilized the social media. The objective may not necessarily be,

as deep as,

engaging the audience in their storytelling, but it has been done largely to generate the desire or the

lust for the

brand or the product. It is also an effective tool to keep-up the contemporary-appeal and the

newness-factor by

having a continuous dialogue.Jimmy Choo organized a real-time treasure hunt around

London via Foursquare to engage fans both online and off.

Gucci has

successfully kept

their high numbers

of Facebook fans

engaged by

continually updating

their content,

thereby sparking

conversations in theform of likes and

comments.

PUBLIC FIGURES:

Public-figure or celebrities have been traditionally employed as one of the marketing mix in luxury

brand

advertising and they still continue to garner attention, credibility and impact. Public figures can span

from film-stars

to music personalities, from sports personalities to royal families and even the designer themselves.

But because

celebrity endorsements are no longer exclusive to luxury space and extensively used (and abused)

across mass

categories, it take a different meaning when it comes to luxury brand endorsement.

Not only does the public figures associated values and personality have to resonate with that of the

luxury brands

aura, but theres a distinct difference in the way celebrity role is crafted, executed and strategically

utilized. Beyond

traditional advertising (largely print in selected media), less in-your-face advertising tools are

employed like accessorization or dressing celebrities for their walk down the red carpet, product

placements within movies and

television programs, invites to special events. This strategy attempts to remove the appearance of

selling while

still promoting the product by making it seem as a part of the celebritys lives, thereby positively

affecting


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consumers attitudes, brand value & purchase intention.

Chopard has been official partner of the

Cannes Film Festival since last 14 years,

showcasing and premiering their

collection by accessorizing celebrities on

the red carpet.The Lebanese singer and UNICEF goodwill

ambassador Nancy Ajram was Cartiers

special guest at the Cartier International

Dubai Polo Challenge held in Dubai, UAE

in 2010.

Omega have sponsored the James Bond

franchise since 1995 earlier with Pierce

Brosnan and now with Daniel Craig

Long-form-commercials / short-films have also utilized the celebrity-factor. Chanel for instance

recently created 3-

minute short film with actress Keira Knightley who replaced Kate Moss in its ads for its CocoMademoiselle

fragrance. Other previous faces of Chanel have included French star Catherine Deneuve and Nicole

Kidman, who

represented Chanel No. 5.

Similarly, as a part of their core values campaign, Louis Vuitton used their website as the online

medium to

showcase their celebrity endorsers journey, their story to bring to life how the brand has been

promoting the art of

travel and inspiring legendary journeys.

The Coco Mademoiselle campaign with Keira Knightley

http://youtu.be/TiO2o1NChAUAngelina Jolies journey, her story (her journey to Cambodia) is

one of the celebrity stories featured on Louis Vuitton website

louisvuittonjourneys.com

PLACEMENT:

The retail branded environment in luxury branding is all

about heightening the consumers brand experience and

amplifying the brand aura. Hence, the branded

environment, the movement of truth, is where it must

live the brand by orchestrating immaculate detailing

that engages all senses of the discerning audience.

Starting from the choice of store location, the chain of

touch-points consumer interacts, the salespersons

presentation and the impact of each touch-point is

critical in creating a unique indulging experience.That said, todays evolving luxury consumers are

increasingly seeking beyond the typical sophisticated, over-thetop, cosmetically elegant

presentation or even the exclusive invites, privileged previews. With the increasing

democratization of luxury brands and the rapid emergence of masstige brands the luxury

consumers have

become more discriminating and demanding. They are seeking a more knowledgeable and

professional assistance,

a trusted and reliable collaboration helping them to manage their stature and lifestyle. Not only has

this led to the


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new business offerings like Quintessentially (more below), but also luxury brands are increasingly

investing in

training and empowering their sales staff.

Another important point to note within the placement factor is that it is not limited to the physical

environment

where the brand retails, but it extends to all the environments or consumer touch-points that thebrand associates

itself with. This spans from the extremely selective niche media where it advertises to the sports, the

events, art,

conversations that it places itself with.

If luxury is about environment and aesthetics, then fashion

magazines like Vogue, InStyle, Vanity Fair, Harpers Bazaar,

etc. provide that complementing environment and aesthetics

for luxury brand to advertise in print media.

Rolex associates itself with more than 150 events in golf, sailing,

tennis, motor-sport, arts and at equestrian tournament vs.

associating with sports like football / cricket that have more massfollowing.

Due to their origin in the writing culture, Montblanc supports

and honors modern-day patrons of the arts through forums

like De La Culture Arts Patronage, Young Artist World

Patronage, Young Directors Project, the Montblanc Cultural

foundation and the Unicef cooperation.

Italian carmaker Maserati placed its GranTurismo coupes in "a

guerrilla-style-product-placement for the 2011 Limitless movie

where the main character needed a ride to express luxury, style

and performance.

E.g.: Quintessentially, a British company with 60 officesworldwide describe themselves as a luxury lifestyle company

that provides concierge services to affluent and high net worth

individuals. Their services include exclusive access to the hottest

VIP-events, cultural happenings, once-in-a-life time experiences,

top restaurants, clubs, spas and hotels, access to fine wines,

private jets, luxury cars and yachts, party planners; art, education

and investment consultants; travel and adventure specialists,

bespoke gifting and styling services and much more.

http://youtu.be/0Pf2fJ5xcz0! PR (PUBLIC RELATIONS):

PR in luxury branding plays an enormous role in image proliferation of the brand, thereby subtly

influencing public

opinion. It is also employed to convey other supporting messages and attributes of the brand which

cannot be

explicitly captured in advertising, but by no means are less important to create brands personality,

mystique and

emotional valueswhether its via the pedigree factor or via public-figure any of the previous 7 Ps

mentioned.

It is also a sophisticated branding machine for maintaining ongoing relevance and dialogue with the

luxury

consumer, especially so in fashion, technology and seasonal trends driven categories. At a tactical

level, PR is

utilized to generate buzz & convey the brand news, point of views of inspirers and influencers

(celebrity talk or the


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designer speak), a crucial support for brand activation (like the fashion weeks, sport-events, themed

previews, etc.).

PRICING:

Pricing plays a quite a big role in the way consumers perceive luxury brands. Consciously or sub-

consciously,consumers tend to generate a mental luxury stature or image with the price-range that the brand

operates.

Therefore, it is important for luxury brands to price thmeselves right as setting the price lower

than the consumer

expectation and willingness to pay can potentially harm the brand value, whereas the reverse can

potentially not

given enough justification for consumers to go ahead and buy.

The pricing strategy in luxury brands gained spotlight in the recent past not only because of the

challenging

economic environment, but because of more informed-and-exposed consumers who are more

discriminating anddemanding, for whom premium pricing without substance doesnt imply luxury. A recent research by

Unity

Marketing suggests that affluent shoppers wont spend ten-times more for something only three

times better. The

luxury-brands must, therefore, justify their price through the interplay of the 7Ps mentioned on top,

thereby keepup and maintain a higher perceived value.

The sales promotions also tend to be handled differently by luxury marketers. While few have

resorted to sales and

discounts, most others play it by adding more value to the purchase like gift with purchase, gift-

certificates or

rebates for the next purchase, multiple item discounts, online or email exclusives, more loyaltypoints, no shipping

and handling charges by online retailers, etc. Luxury brands also use the channel of luxury retailers

like Harvey

Nichols, Saks 5

th

Avenue who offer annual sales by offering them slightly lower prices.Another way employed by

luxury brands is by creating an extension into a secondary line with relatively lower price

points like Giorgio Armanis - Armani Exchange, Roberto Cavallis - Just Cavalli, Pradas Miu Miu,

Alexander

McQueens - McQ lines.

KEY LEARNINGS & TAKEOUTS:

In conclusion, the key to luxury brand marketing boils down to the following three points:

y brand must perform at an experiential level

as well.

As luxury consumers evolve, not only these act as points of differentiation, but also as substance to

justify

a premium value and pricing.

generate

ongoing relevance and dynamism through the persona, PR & public-figure factor.

sivity and stature with the

paucity factor

and the placement factor from the retail experience to the touch-points it associates itself with.


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The 8 Ps of luxury brand marketing can provide a holistic framework to luxury marketers. The 8 Ps

may not be a

universal methodology, yet it presents a strong analytical toolbox to audit and leverage the

brand potential.

That said, a pragmatic approach must be underlined, as the situation and challenges would differ

from brand-tobrand and market-to-market.

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8 p's of luxury branding