Luxury

LUXURY

Selling Luxury ….

Introduction

• A luxury brand is an expensive brand or an elite brand.

• To some it is an object of desire,sometimes aspirational and sometimes almost lustful.

• Richemont Annual Report defines it “ it is an object and a catalyst for thought…..The aim of a luxury brand is to awaken desire and pleasure.”

LUXURY

Luxury Products & Services

Cars: Jaguar, Mercedes Benz, Lamborghini, Rolls Royce, Bentley, Ferrari, Bugatti

Couture:

Indian couture designers: Rohit Bal, Tarun Tahiliani or brands like Versace

Hotels & resorts : Amar Vilas (Oberoi)

LUXURY


Accessories

Footwear: Jimmy Choo

Handbags: Louis Vuitton, Hermes, Prada

Small leather goods: Dunhill

Watches: Piaget, Tag Heur

Eyewear: Armani, D&G, Chanel

LUXURY


Perfumes: Channel

Jewellery & Gems: Cartier, Tiffany

Writing instruments: Mont Blanc

Luggage: Louis Vuitton

Liquor : Blue label

The Market ..

• The luxury market is growing at a rapid pace in the India with a compounded annual growth of 25 per cent.

• Its present and future is endowed- estimated to be at US$4.76 billion, the luxury market in India is set to touch three times its current size at US$14.72 billion by 2015.

• India has become the prime destination for top-notch global brands, while many high-end luxury brands have quickly set up their outlets here.

Selling the brand…

• Luxury Branding is an art of control – Control on marketing just the right amount, neither more nor less.

• Any less and the impact is dampened, any more and the brand runs a risk of being labelled ‘run-of-the-mill’, or a ‘mass-brand’, which is simply trying to sell volumes.

Sales Promotion Strategies…

Ads (ATL) :

TVCs:

•A lot of Luxury brands don’t believe in TVCs at all.

•Some, which are at times at border between luxury and massive, indulge in it.

•But even then, the ads are on the lines of showcasing class and quality, associating with the best of celebrities.

•E.g. L’Oreal is a classic example of this. L’Oreal Paris is endorsed by Aishwarya Rai, while another in-house mass market brand, Garnier, is endorsed by celebrities like Sonam Kapoor and Genelia D’Souza.

Print Ads• Luxury brands may also indulge in print ads, but selectively.

• They would be picky about the frequency (which is low) and the ads would be in very specific locations.

• E.g. We might find a Titan ad on any page of Times Of India, but only a Times Life front page would carry Tag Heuer ads.

• Also ever seen Louis Vuitton ads in India Today? – We will have better chances of finding them in premium magazines like The Economist or GQ.

Sales or discounts

Luxury brands also do not offer frequent ‘sale’s, or mass discounts.

Comparative to other brands, the no. of ‘sale’s, if at all organized, is much lesser.

•E.g Louis Vuitton goes never for discounts .

BTL

• BTL is something that luxury brands do endorse.

• This is where all the CRM comes into picture, maintaining databases, sending out personalized mails, season launch catalogs, invitation to high-society events and dinners etc.

• Luxury brands aim to please, make the customer feel happy at being taken care of.

Heritage

• A few luxury brands, especially ones that have been in existence for a long time ( 50+ years ) also believe in building a heritage around themselves, of having served with excellence over many years

• (Heard about ‘Chevrolet: Since 1911‘, or ‘Skoda: Obsessed with quality since 1895‘?).

• An assurance of having survived the tests of time is the best quality assurance that a company can present.

Cult• The Harleys and Diesels of the world come in this category.

• Harley Davidson is quite successful in building a cult around itself – be it through the HOG (Harley Owners Group) Membership, Classic ‘we believe’ campaign, or BTL promotions of ’a breath of fresh air’.

• It makes Harley Owners into a unique, super-exclusive cult of people, enabling the show off factor.

Strategic Partnership• Strategic partnership between luxury brands is an ideal way of

elevating brand image within the high net worth individual’s network.

• To work in collaboration with another prestigious brand will enable to target exclusive clientele.

• Brand partnerships add value and importance, generating new revenue streams and building upon existing customer relationships.

• Strategic alliances between luxury brands enable those involved to make the most out of each other’s communication channels.

• By creating unified marketing messages and maximising exposure and marketplace standout, luxury brands are able to deliver unparalleled and unmatchable experiences.

Internet

• The internet has now become the number one source of information about luxury products for high net worth individuals.

• Presence online is very important, but the luxury brand’s positioning still needs to be pitched as exclusive, despite the high accessibility of the internet.

Contd..

• Deliver aspirations, exceed expectations and stimulate imaginations.

• Impart a memorable web experience on social media sites such as Facebook, Twitter, Small World, and also through online apps.

• One-to-one relationship with the consumer.

• Feel they are important and that owning a piece of the brand will enrich their lives.

Public Relations• Maintain high-level day-to-day and strategic public relations.

• Strong relationships with both luxury media and journalists within the worlds of fashion, beauty, cars, watches, jewellery, yachts, interior design, restaurants, golf and exclusive destinations with glamorous hotels and properties.

• Understand what’s important to high net worth individuals and know how to communicate with them.

• Ensure that customers continue to think highly of the brand

• Loyal customers

A study…

• Luxury brands need localised strategies

• According to Forbes, India has the fastest-growing population of millionaires in the world.

• Part of the problem is that Western luxury brands don’t seem to understand Indian consumers.

• When they first entered India, they created splashy advertising campaigns targeting the old money elite. But the results were poor largely.

• A private report on luxury in India produced by management consultants AT Kearney and The Economic Times revealed that the newly affluent lack sufficient knowledge and awareness of luxury brands to drive significant sales. Furthermore, the current strategy of establishing a large retail footprint supported by traditional mass marketing is not working.

• Indeed, in order to succeed in India, luxury brands need to localise their marketing strategies.

• This goes further than just putting an Indian print on a bag or collaborating with a local celebrity.

• A multitude of cultures, languages, religions, festivals, colours and tastes make up this land of 1.1 billion people.

• So, it’s about understanding the difference between the flamboyant nature of a Punjabi customer and the more reserved nature of a Gujarati, and speaking to each of them in the specific cultural register that they respond to.

• For example, luxury brand Montblanc — which successfully operates nineteen retail points across first, second and third tier cities in India — has regionalised all their marketing material.

• When creating invitations for potential consumers in the Punjab in northern India, for example, the invitations are more lavish and the language more boisterous than those sent to consumers in southern India.

• It ensures you are connecting personally to your consumer and customers respond to this.

• Brands like Louis Vuitton and Rolls Royce have also localised their approaches, identifying important events and celebrations amongst potential clients and arriving with

personalised gifts or a surprise car service for the occasion.• E.g. As shown : A Rolls Royce picnic set

Conclusion ..

• Getting traction in the Indian sub-continent has been a challenge for every Western luxury brand that has tried to crack this complex new market.

• Those brands who are willing to better understand and connect with the local Indian consumer will be the ones who are most successful.

Thanks…

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Luxury