Luxury Handbags

An Introduction to Luxury Luxury handbag brands must differentiate themselves by their high end traits: quality, heritage of craftsmanship, recognized style and design, limited production, global reputation, unique designs and particular marketing programs.

Luxury bags are known for their brand image, and must promote their brand consistently and constantly.

Customers tend to be loyal to luxury handbag brands, since the products satisfy their needs and desires at the same time.

Brand Image: Importance of Differentiation

An Introduction to Luxury

(Hayden Panettiere for Dooney and Bourke)

“There’s no question that celebrities impact fashion, and in a very big way.” stated by Ed Cortese, a stylist from Bazaar and GQ.

There has been a significantincrease in the percentageof consumers looking toward celebrities as fashion inspirations since 2000.

Designers and luxury handbag brands utilize “star power” through print ads and product placement seen through tabloid photos and gossip columns.

Source: Cotton Inc.: The Cult of Celebrity

Aged 16 to 24 47%

Aged 25 to 34 26%

Aged 35 to 55 24%

Aged 55 to 70 2%

PERCENTAGE OF WOMEN WHO POINT TO CELEBRITIES FOR FASHION IDEAS:

An Introduction to Luxury The increase in luxury consumption, due to atypical consumers entering the luxury market, has allowed luxury handbags to seem ‘recession proof’.

EXAMPLE: In attempt to combat this issue, Gucci now produces handbags that range in price from $150 to over $3000.

While new customers have increased the luxury market share, this threatens the prestige of luxury products.

Secondary research reveals the importance of:

-Brand prestige, imageand recognition

-Reaching new target markets whilekeeping loyal customers

-The importance of celebrity influence

$2,730.00 Gucci Bag $179.00 Gucci Bag

Hold Focus Group (Qualitative Research Approach)

Analyze the Data

Brainstorm Objectives and Potential Hypotheses

Administer Survey Using Qualtrics.com and Facebook.com (Questions Geared Toward

both Descriptive and Causal Research)

Finalize Hypotheses and Create Survey

Assess Limitations

ProposeRecommendations

for Future ResearchMethodology

Determine which product design is most appealing to consumers. Evaluate the effectiveness of different

marketing strategies (including advertisements and public relations) for

luxury handbags.

Determine the socioeconomic factors that influence purchase intent for luxury handbags.

Objectives

A paparazzi photo of a celebrity using a luxury handbag in everyday life will have a more positiveeffect on purchase intent than a celebrity print advertisement for the product.

The effect (from the first hypothesis willdecrease the less famous the celebrity is.

Realistic use of a handbag in a print advertisement(verses unrealistic/stylized placement) will increasepurchase intent

Among consumer whose family annual income is>$75,000, those who live near major cities (<35 miles)will have greater purchase intent for luxury handbagsthan those who don’t live near majors cities (>35 miles).

An all-over repetition of the brand logo will decrease purchase intent.

H1

H2

H3

H4

H5

Hypotheses

Survey

A paparazzi photo of a celebrity using a luxury handbag in everyday life will have a more positiveeffect on purchase intent than a celebrity print advertisement for the product.

The effect (from the first hypothesis willdecrease the less famous the celebrity is.

Realistic use of a handbag in a print advertisement(verses unrealistic/stylized placement) will increasepurchase intent

Among consumer whose family annual income is>$75,000, those who live near major cities (<35 miles)will have greater purchase intent for luxury handbagsthan those who don’t live near majors cities (>35 miles).

An all-over repetition of the brand logo willdecrease purchase intent.

Independent sample t-test

ANOVA

Simple Regression

Independent sample t-test

Independent sample t-test

= Statistically Significant

= Not Statistically SignificantResults

Lindsey Lohan in Print Ad Above/Tabloid Below

ResultsACCEPT

REJECT

Kate Moss sporting black Genevieve Jones purse above; Luxury handbag consumer seen left,carrying the same bag in green.

Results

Scarlett Johansson for LV:Unrealistic Left/Realistic Right

ACCEPTResults

REJECTResults

REJECTResults

Poor Sampling Frame:Low External Validity,

Sample Selection Error

Time Frame/Resources Use of Survey: Spurious Association

Limitations

Focus Group-Selection error: few participants,

homogeneous group

-Participants expressed low interest in luxury handbags

-Bad sampling frame, low external validity

-Administrative error: inhibiting respondents due to note taker and video camera

-Focus group yielded poor/useless results

Survey-Magazine readership inconsistany: included

both monthly and weekly publications

-Overtly sexual tabloid vs. print ad photos of Madonna: polarizing results

-Glamour effect: quality print ads overshadowingtabloid photos (eliminating within-subjects design effects)

-Repeated measures: introduced for realism of ad

question: constancy of conditions

-Time constraints did not allow for a pilot pest

Limitations

Deliberate Falsification Possibility: Possibility of Male Respondents

Requirements Unfulfilled for Distance and Income Requirements

Confounding Variable: Purchase Intent for all Tabloids Against Purchase Intent for all Print-Ads/Not Enough Respondents to Overcome

Internal Validity Bias: Respondents Saw Two Images for Each Questionvs. Randomly Seeing One Image for Each Question

Likert Scales: Wording and Scaling Inconsistencies

Limitations

Print ads are an effective way to influence purchase intent.

Celebrities are less influential on consumers than anticipated.

More realistic ads should increase purchase intent.

Observations

1.Recommendations

Perform on a larger scale with more resources:

-internal validity could increase as well -use randomization from a larger image bank -to overcome moderating variables that

2.Research could go into a lot more depth about attitudes toward specific aspectsof each ad or tabloid image that mayinfluence purchase intent.

These aspects could include:-Layout-Environment-Number of handbags-Emphasized elements

Recommendations

3. 4.The counterfeit handbag industry should be addressed in more detail.

-Consumer attitudes surrounding ‘fakes’-Who purchases counterfeits and why?-Product attributes that determineconsumer purchases (counterfeit vs. real)

Research should be applied to other luxuries.

-Addresses similarities to furthermarketers understanding ofpurchase intent-Concentrate on similar fashionluxuries: Eye wear, Footwear, etc.

QUESTIONS

We will now take any