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 most complicated 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 nice place.

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 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 assert themselves - 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 enough the 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 tend to have larger repertoire
of luxury brands, have a choice of not-so-common luxury brands, have a definitive
reason for their choice and sometime even prefer to stick to specialist brands. Few of
the consumer quotes (below) from various quantitative researches in UAE emphasize
this point:

I prefer to buy my watch from an expert watch-brand, not a fashion label.

I like things that are exclusive and specialized like the really top suit brands and ties.
You know, where one tie is the price of a good Armani suit, but that youll only find in
Italy, only at one location and not in any branches anywhere else in the world. Thats
like once in a while you want to buy something thats special and wear it a few times
on specific occasions.

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While genuine appreciation for product excellent needs no explanation, as mentioned
earlier it is not mutually exclusive. In simple words, it does not mean that people who
acquire luxury brands for either asserting-self or differentiation have no appreciation
and love for beautiful products. But, then there are others who buy luxury without
having any baggage of what others think. They buy it because they genuinely love
the physical / functional attributes that the product delivers or because they find a
profound connection with the brand / the brand story.

The bottom line is that whether it is self assertion, differentiation or genuine appreciation
for product excellence, these stories and the aura that surrounds the brands is what
makes luxury brands desirable. Packaged as the 8 Ps of luxury brand marketing, this
paper attempts to bring together the elements and interplay between them that are
employed in the luxury brand marketing mix. Some of the elements have been named
to fit the 8P packaging and therefore, my humble request to readers will be to take
the broad-point made versus getting stuck in semantics. Yet, another important point
to acknowledge is that the degree of significance of these elements may vary from
brand-to-brand and market-to-market. The point-of-view of this paper is more that of
a practitioner, than a theoretician.

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 THE 8 PS PILLARS OF LUXURY BRAND MARKETING
PERFORMANCE

Performance refers to the delivery of superior experience of a luxury brand at two

levels first, at a product level and second, at an experiential level.

At a product level, fundamentally it must satisfy the functional and utilitarian

characteristic as well as deliver on its practical physical attributes a recipe of quality
or design excellence ingredients like craftsmanship, precision, materials, high quality,
unique design, extraordinary product capabilities, technology & innovation. For
example:

On their 70th anniversary, Patek Philippe unveiled a new

complicated wristwatch. Along with a unique column
wheel chronograph movement, the day and month appear
in a double window at 12 oclock, with a hand indicating 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 to become 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).

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 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.

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 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 factor, but subconsciously they are also influenced by the
brands rich lineage, heritage and the years of mastery.

Coco Chanel Karl Lagerfeld took With Chanel Coco
started her the helm Mademoiselle campaigns in
business in 1913 in the 1980s 1981, 2008, 2009 & the recent
and within a few and has been 2011, Chanel has continuously
decades, became modernizing the leveraged its pedigree / brand
a revolutionary brand ever mystique.
couturier. since.

Similarly,
Rolls-Royce
celebrated
the 100th
anniversary
of its iconic

emblem, the

Spirit of Ecstasy with 100 cars for 100 years and
Gucci opened the doors of its own featured a collection of Rolls-Royce models,
museum in Florence to mark the supplied by members of the Rolls-Royce
completion of the houses 90th- Enthusiasts Club, dating back to 1911
anniversary celebration.

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 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 to widely 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.

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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.

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 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 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 and even 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.

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At an overall level, luxury advertising
messages can be observed:
As more emotional and sensual to
distance it from mass-premium brands
Create a world and an aura that is truly
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. It has 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 Louis Vuitton created a 3-minute
website focuses on its craftsmanship thematic video for its journey
legacy: http://bit.ly/uiSQ8F campaign.

http://youtu.be/NQlueM5ETYU

A one-and-half minute video by Tiffany

& Co. focuses on promoting gifting
during holidays.
http://youtu.be/BacfKM3876g
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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.

With the objective of strengthening the brands

association to love and romance Tiffany & co.
launched 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 showcases pioneering 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
the form of likes and comments.
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 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
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.

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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 Coco Mademoiselle 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/TiO2o1NChAU
Angelina Jolies journey, her story (her
journey to Cambodia) is one of the
celebrity stories featured on Louis
Vuitton website
http://louisvuittonjourneys.com

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 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-the-top, 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 new business offerings
like Quintessentially (more below), but also luxury brands are increasingly investing in
training and empowering their sales staff.

E.g.: Quintessentially, a British

company with 60 offices worldwide
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!

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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 the brand 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
mass following.

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.

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 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 values whether 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 designer
speak), a crucial support for brand activation (like the fashion weeks, sport-events,
themed previews, etc.).

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 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 and demanding, 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 keep-up 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 loyalty points, no shipping
and handling charges by online retailers, etc. Luxury brands also use the channel of
luxury retailers like Harvey Nichols, Saks 5th Avenue who offer annual sales by offering
them slightly lower prices.

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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.

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 KEY LEARNINGS & TAKEOUTS

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

 Product excellence by itself in not enough, the luxury 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.
While pedigree factor is important to exuberate the years of mastery or lineage, it
is crucial to generate ongoing relevance and dynamism through the persona, PR
& public-figure factor.
 Luxury brands must continue to maintain a certain degree of exclusivity and stature
with the paucity factor and the placement factor from the retail experience to
the touch-points it associates itself with.

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-to-brand
and market-to-market.

Author
Rohit Arora is Strategic Planning Director at BPG | bates in Dubai,
UAE.
Within the luxury segment, he has worked on the strategic
communication projects of De Beers, Ford-Lincoln, Omega
watches, Sacoor Brothers, Al Tayer Group, luxury real-estate
projects, luxury healthcare project, high-end consumer durables
and banking solutions designed for the high-end consumers.
He has also worked with JWT and Y&R previously.

Official contact:

rohit@batespangulf.com
https://twitter.com/#!/rohitsharing
http://ae.linkedin.com/pub/rohit-arora/6104/293/

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