Kalpana Heliya
Par 100 posts (V.I.P)
Hey.............Bored of reading conventional Marketing Concepts.....
Here's some interesting stuff which is really interesting if u read it interestingly:kelw:
Luxury Brands: Setting The Record Straight
We know some consumers buy luxury brands because they are 'luxury brands'. Be it status, badge value, or a desire to feel part of the in-crowd, some people buy Burberry for its plaid, Mercedes for its hood ornament, Chanel for the 'CC'. But that is not the scenario for the typical luxury consumer.
In only a handful of luxury categories automobiles, cosmetics and beauty, watches, consumer electronics do a majority of affluent consumers rate the brand as 'very important' in their purchase decision. In every other category in our annual luxury surveys and quarterly tracking studies, the brand plays a supporting role.
New luxury insights[/U]
To better understand the role of the luxury brand in affluent consumers' purchase decisions, we conducted seven focus groups, followed by two annual consumer surveys that asked about the influence of brands on purchase. This gives brand owners and retailers a new perspective and provides actionable strategies for building brands that will resonate with today's luxury consumer.
Brands justify purchase
Brands are not the reason one buys: rather, the brand justifies the purchase. Despite the widely held belief that brands are the main attraction in the luxury market, our research does not provide any supporting evidence. The fact is that among luxury consumers, the affluent top 20% of US households with incomes of $75,000-plus, the brand is not why people buy.
Only in a handful of categories, generally mechanical or highly personal, is it a 'very important' purchase driver. For all other luxury categories, brands are rated 'somewhat important'. Luxury consumers do not buy because of the brand, nor do they use it as a criterion to define luxury. Fewer than 25% surveyed agreed that 'Luxury is defined by the brand of the product. So if it isn't a luxury brand, it isn't a luxury.'
What role, then, does brand name play in the purchase decision?
The brand serves as a justifier that gives the consumer 'permission' to buy. Luxury consumers have an emotionally driven, right-brained desire to purchase. The shopper falls in love with an item and finds herself at the cash register before her rational mind reminds her that she does not need another one of those or one that costs so much. (I use 'she' because women buy about two-thirds of luxuries.)
'Justifiers' are left-brain rationales that give consumers permission to buy luxuries. The more extravagant the purchase, or the more cautious the shopper, the more justifiers one needs to tip the equation in favour of purchase.
A luxury brand justifies its purchase by confirming that the product is of outstanding quality, is a classic, is well worth the price, will be admired and noticed, and so on. The role of purchase justifiers is hardly insignificant, but is clearly not the reason why people buy. People buy because they love to. Brand reputation encourages the consumer to pay a little bit more and is a 'Good Housekeeping Seal of Approval'. Justifying the purchase is the essential role of the brand and the reason that companies must continue to invest in building customer relationships.
Old luxury is about the 'thing': new luxury is about 'experience'
Luxury brands are defined intrinsically and consumer-centrically. When I talk to marketers two definitions of luxury crop up continuously. Many executives define luxury as the special qualities, features and attributes intrinsic to a product. Whether fashion, cars, furniture, linens, jewellery, or tabletop, most people can agree that specific product features constitute luxury.
For cars it is leather seats and wood detailing, in jewellery it is platinum and real gemstones, in linens it is 500-threadcount sheets of Egyptian cotton, and so on. Luxury may include hand-crafting, careful attention to detail, superior quality and design, special colours and textures, natural or exclusive materials, or durability. Based on the intrinsic definition, the product expresses features that confer 'best of the best' status.
Others recognise this definition of luxury is too confining, or does not reflect recent marketplace changes. They recognise a need to incorporate consumers' experience and perception of luxury into the equation.
This consumer-centric definition of luxury focuses on experience, the personal dimensions of luxury. Consumers describe luxury in the following ways.
• Quality is in the eyes of the beholder, often associated with expense, but they do not necessarily go hand in hand. Sensual experience, massage, a wonderful dinner, travel, something very special you do for yourself.
• A state of mind, the ability to do something that I could not do before.
• I can live my life my way and not worry about money. Luxury means comfort.
• Luxury is a privilege; to be able to do things in regard to services, time, material things.
• The greatest luxury is to have the time to do whatever one wants and to be able to afford to do it.
• I buy what I like and what I want.
When we talk about luxury from this experiential perspective, brands are irrelevant. What matters is how the brand delivers a luxury feeling or experience.
The new luxury
The term 'new luxury' is bandied about without any clear-cut definition. 'New luxury' usually refers to recent luxury concepts that are more affordable, as opposed to 'old luxury' that describes heritage brands Mercedes, Tiffany, Cartier, and such like. 'New luxury' is often associated with the 'democratisation of luxury' or 'mass-tige' brands: in short, more affordable luxury goods.
A more useful definition of 'new luxury' should be defined from the consumer perspective, related to the experience of luxury. 'Old luxury' is defined by the quality, features and attributes of the product without reference to the consumer. It is about the 'thing' (a noun); 'new luxury' is about experiencing (a verb).
Luxury's triple play
Product brand, dealer brand and the price/value relationship interact to make sales.
In luxury marketing there is a subtle interplay between these three factors that influence the consumer to buy. Depending on whether the shopper is buying a home luxury (linens, furniture, appliances) or a personal luxury (cars, apparel, fashion accessories or beauty products), the relative importance of each factor may shift, but in all categories these three factors interact to encourage the consumer to buy.
In home luxury purchases, price and value are the key factors. Brand or company reputation, and the store or dealer's reputation/ brand follow and are of nearly equal importance. In these categories, product brand plays the most significant role in the purchase of electronics and photography (brand rated 'very' or 'somewhat important' by 86%), kitchen appliances, bath and building products (brand rated 79% 'very' or 'somewhat important'), kitchenware, cookware, housewares (78%) and tabletop, dinnerware, stemware, flatware (75%).
Product categories with high brand importance incorporate greater 'performance' values in terms of purchase. These luxury products tend to 'do' something practical or functional. Less branded categories linens and bedding, furniture and floor coverings, fabrics, wall coverings and windows, art, antiques and garden products have a higher decorative component driving purchase: they are expected to look good, but not necessarily to be practical.
In personal luxury categories automobiles, fashion and accessories, jewellery, watches, and cosmetics/beauty products the brand is very important in the purchase decision: automobiles and recreational vehicles (83%), fragrances and beauty products (62%), and watches (64%).
As in the home category, highly branded personal luxuries imply mechanical performance or intimate personal use. For clothing and fashion accessories shoes, handbags, luggage, and so on more luxury consumers rate the brand 'somewhat important', rather than 'very important'. For jewellery, the product brand is 'very' or 'somewhat important' to a small majority (52%), which suggests that luxury jewellery marketers have an opportunity to build brand awareness and loyalty.
In the personal luxury category, product brand ranks first, followed by price/value relationship, and the store or dealer's reputation or brand. This underscores the critical importance for the luxury brand marketer to pick the right retail distribution partners. It also explains why many marketers embrace captive retail as their favoured distribution channel, rather than allow the brand to get lost among all the other brands in a department store, displayed by hourly workers who do not care or know enough to showcase the brand effectively. Many companies, especially personal luxury companies, have decided that they themselves are best able to present their brand at retail.
Brands must perform
Luxury brands must satisfy consumers' performance expectations. Performance is a key word in talking about luxury brands, not only in the sense of mechanical execution, but as it relates to how the product performs experientially. The concept of luxury brand performance must be freed from a narrow mechanistic definition and seen in the more expansive light of experiential marketing.
Luxury jewellery performs as the feeling one has of being more beautiful, more sophisticated, more stylish. Luxury fashion performs in a similar emotional way. So too does home fashion; it performs as an expression of someone's good taste in their personal environment.
The concept of luxury brand performance connects the intrinsic definition of luxury with the experiential. It is through performance that 'old luxury' (the noun) becomes transformed into the 'new luxury' that delivers an experience or an emotion.
Luxury marketers must measure the performance of their brands against the desires of their customers. They need to make certain that the brand incorporates all the promised intrinsic features, and delivers the experiential values that touch the consumer emotionally.
Luxury, corporate strategy and consumer psychology
The role of the luxury brand is to connect corporate strategy (which controls design and manufacturing, and develops branding messages) with consumer psychology (why people buy). It is through brand performance, both tangible and emotional, that the company delivers satisfaction to luxury consumers. Luxury marketers, while they must produce 'best of the best' products, must also realise that the product, in itself, is secondary to consumer experience.
It is on the experiential plane that luxury brands perform magic. Luxury jewellery and watch marketer David Yurman describes the experience of connecting with the consumer: 'We have a consumer religion. We are out there buying. It is sort of our God-given right. We think we can buy and we can get things for ourselves. But that experience is really almost a religious experience. It's like, 'Don't bother me. I am at the counter. Don't put that perfume on me. I'm here to search out that!' And when they hit 'that', that is their connection. So we've made a connection. These are very personal moments, these connections with consumers.'
The essential role of brands and branding in the luxury market is to influence the consumer in their purchase decision. Luxury brands become the medium through which we influence consumers to buy. Brands are the embodiment of corporate strategy, designed, created and directed by the company. The brand connects with consumers' psychology to encourage purchase. Luxury marketers who focus solely on the product and design the ultimate best of the best miss a huge opportunity to deepen their connection with the consumer. Quality items are fine, but do not necessarily motivate at the experiential, emotional level.
In our latest survey, a majority of luxury consumers found the greatest satisfaction in experiential rather than home or personal luxury purchases. And that means less money for marketers of home and personal luxuries. That is why it is imperative for every luxury marketer to embrace the experiential dimension. They need to make sure that their best-of-best product delivers the emotional, experiential satisfactions that today's luxury consumer desires .
The new luxury branding paradigm
Combining product features and benefits with consumer-centric luxury values is the new paradigm for luxury brands.
The business of communicating a luxury brand has become more complex, as marketers must make the leap beyond luxury product features and benefits to delivering experiential luxury performance.
The new generation of luxury consumers, the 76 million baby boomers aged 40 to 58, who are or will soon be empty-nesters, are not driven by crass materialism. They want more from life than simply buying another thing to display, another outfit, a new gadget. Today's luxury generation expresses a need to find a deeper meaning in life. They are more enlightened, less materialistic luxury consumers; we call them'butterflies', as they have emerged from their luxurious cocoons to reconnect with the world in meaningful ways.
Butterflies' consumption is driven by a desire for self-actualisation as described by Maslow in his hierarchy of needs. For luxury consumers who have an excess of material goods, a supportive family and a career that provides status and emotional rewards, self-actualisation becomes the ultimate goal.
This desire to become more and more what one is, to become everything that one is capable of becoming, explains the pursuit of self-fulfillment through greater spiritual enlightenment, the pursuit of knowledge, peace, appreciation of beauty, culture and aesthetics.
The branding challenge is to connect the dimensions of luxury features and experiences with the consumer. Today, luxury must deliver more than quality or design excellence. Luxury brands must deliver emotional rewards and experiential satisfactions.
The role of luxury branding cannot be separated from other purchase influences; the retailer or dealer brand, or price/value equation. All three influencers engage the consumer on the experiential plane. The retailer's brand encompasses the shopping experience, the thrill of the hunt, of finding something wonderful in a magical environment or, conversely, finding something wonderful in the most convenient fashion.
Price/value is also experiential. The joy of finding a good deal, or finding a $500 jacket for $250, are powerful motivators for shoppers. Remember, ultimately consumers do not buy because of the luxury brand: the brand justifies the purchase.
The true measure of a luxury brand is how well it delivers satisfaction, experientially. The luxury brand becomes the means to connect corporate strategy with consumer psychology. This is the new paradigm for luxury branding in the 21st century. It is all about the experience.
:SugarwareZ-167::SugarwareZ-167::SugarwareZ-167::SugarwareZ-167:
Here's some interesting stuff which is really interesting if u read it interestingly:kelw:
Luxury Brands: Setting The Record Straight
We know some consumers buy luxury brands because they are 'luxury brands'. Be it status, badge value, or a desire to feel part of the in-crowd, some people buy Burberry for its plaid, Mercedes for its hood ornament, Chanel for the 'CC'. But that is not the scenario for the typical luxury consumer.
In only a handful of luxury categories automobiles, cosmetics and beauty, watches, consumer electronics do a majority of affluent consumers rate the brand as 'very important' in their purchase decision. In every other category in our annual luxury surveys and quarterly tracking studies, the brand plays a supporting role.
New luxury insights[/U]
To better understand the role of the luxury brand in affluent consumers' purchase decisions, we conducted seven focus groups, followed by two annual consumer surveys that asked about the influence of brands on purchase. This gives brand owners and retailers a new perspective and provides actionable strategies for building brands that will resonate with today's luxury consumer.
Brands justify purchase
Brands are not the reason one buys: rather, the brand justifies the purchase. Despite the widely held belief that brands are the main attraction in the luxury market, our research does not provide any supporting evidence. The fact is that among luxury consumers, the affluent top 20% of US households with incomes of $75,000-plus, the brand is not why people buy.
Only in a handful of categories, generally mechanical or highly personal, is it a 'very important' purchase driver. For all other luxury categories, brands are rated 'somewhat important'. Luxury consumers do not buy because of the brand, nor do they use it as a criterion to define luxury. Fewer than 25% surveyed agreed that 'Luxury is defined by the brand of the product. So if it isn't a luxury brand, it isn't a luxury.'
What role, then, does brand name play in the purchase decision?
The brand serves as a justifier that gives the consumer 'permission' to buy. Luxury consumers have an emotionally driven, right-brained desire to purchase. The shopper falls in love with an item and finds herself at the cash register before her rational mind reminds her that she does not need another one of those or one that costs so much. (I use 'she' because women buy about two-thirds of luxuries.)
'Justifiers' are left-brain rationales that give consumers permission to buy luxuries. The more extravagant the purchase, or the more cautious the shopper, the more justifiers one needs to tip the equation in favour of purchase.
A luxury brand justifies its purchase by confirming that the product is of outstanding quality, is a classic, is well worth the price, will be admired and noticed, and so on. The role of purchase justifiers is hardly insignificant, but is clearly not the reason why people buy. People buy because they love to. Brand reputation encourages the consumer to pay a little bit more and is a 'Good Housekeeping Seal of Approval'. Justifying the purchase is the essential role of the brand and the reason that companies must continue to invest in building customer relationships.
Old luxury is about the 'thing': new luxury is about 'experience'
Luxury brands are defined intrinsically and consumer-centrically. When I talk to marketers two definitions of luxury crop up continuously. Many executives define luxury as the special qualities, features and attributes intrinsic to a product. Whether fashion, cars, furniture, linens, jewellery, or tabletop, most people can agree that specific product features constitute luxury.
For cars it is leather seats and wood detailing, in jewellery it is platinum and real gemstones, in linens it is 500-threadcount sheets of Egyptian cotton, and so on. Luxury may include hand-crafting, careful attention to detail, superior quality and design, special colours and textures, natural or exclusive materials, or durability. Based on the intrinsic definition, the product expresses features that confer 'best of the best' status.
Others recognise this definition of luxury is too confining, or does not reflect recent marketplace changes. They recognise a need to incorporate consumers' experience and perception of luxury into the equation.
This consumer-centric definition of luxury focuses on experience, the personal dimensions of luxury. Consumers describe luxury in the following ways.
• Quality is in the eyes of the beholder, often associated with expense, but they do not necessarily go hand in hand. Sensual experience, massage, a wonderful dinner, travel, something very special you do for yourself.
• A state of mind, the ability to do something that I could not do before.
• I can live my life my way and not worry about money. Luxury means comfort.
• Luxury is a privilege; to be able to do things in regard to services, time, material things.
• The greatest luxury is to have the time to do whatever one wants and to be able to afford to do it.
• I buy what I like and what I want.
When we talk about luxury from this experiential perspective, brands are irrelevant. What matters is how the brand delivers a luxury feeling or experience.
The new luxury
The term 'new luxury' is bandied about without any clear-cut definition. 'New luxury' usually refers to recent luxury concepts that are more affordable, as opposed to 'old luxury' that describes heritage brands Mercedes, Tiffany, Cartier, and such like. 'New luxury' is often associated with the 'democratisation of luxury' or 'mass-tige' brands: in short, more affordable luxury goods.
A more useful definition of 'new luxury' should be defined from the consumer perspective, related to the experience of luxury. 'Old luxury' is defined by the quality, features and attributes of the product without reference to the consumer. It is about the 'thing' (a noun); 'new luxury' is about experiencing (a verb).
Luxury's triple play
Product brand, dealer brand and the price/value relationship interact to make sales.
In luxury marketing there is a subtle interplay between these three factors that influence the consumer to buy. Depending on whether the shopper is buying a home luxury (linens, furniture, appliances) or a personal luxury (cars, apparel, fashion accessories or beauty products), the relative importance of each factor may shift, but in all categories these three factors interact to encourage the consumer to buy.
In home luxury purchases, price and value are the key factors. Brand or company reputation, and the store or dealer's reputation/ brand follow and are of nearly equal importance. In these categories, product brand plays the most significant role in the purchase of electronics and photography (brand rated 'very' or 'somewhat important' by 86%), kitchen appliances, bath and building products (brand rated 79% 'very' or 'somewhat important'), kitchenware, cookware, housewares (78%) and tabletop, dinnerware, stemware, flatware (75%).
Product categories with high brand importance incorporate greater 'performance' values in terms of purchase. These luxury products tend to 'do' something practical or functional. Less branded categories linens and bedding, furniture and floor coverings, fabrics, wall coverings and windows, art, antiques and garden products have a higher decorative component driving purchase: they are expected to look good, but not necessarily to be practical.
In personal luxury categories automobiles, fashion and accessories, jewellery, watches, and cosmetics/beauty products the brand is very important in the purchase decision: automobiles and recreational vehicles (83%), fragrances and beauty products (62%), and watches (64%).
As in the home category, highly branded personal luxuries imply mechanical performance or intimate personal use. For clothing and fashion accessories shoes, handbags, luggage, and so on more luxury consumers rate the brand 'somewhat important', rather than 'very important'. For jewellery, the product brand is 'very' or 'somewhat important' to a small majority (52%), which suggests that luxury jewellery marketers have an opportunity to build brand awareness and loyalty.
In the personal luxury category, product brand ranks first, followed by price/value relationship, and the store or dealer's reputation or brand. This underscores the critical importance for the luxury brand marketer to pick the right retail distribution partners. It also explains why many marketers embrace captive retail as their favoured distribution channel, rather than allow the brand to get lost among all the other brands in a department store, displayed by hourly workers who do not care or know enough to showcase the brand effectively. Many companies, especially personal luxury companies, have decided that they themselves are best able to present their brand at retail.
Brands must perform
Luxury brands must satisfy consumers' performance expectations. Performance is a key word in talking about luxury brands, not only in the sense of mechanical execution, but as it relates to how the product performs experientially. The concept of luxury brand performance must be freed from a narrow mechanistic definition and seen in the more expansive light of experiential marketing.
Luxury jewellery performs as the feeling one has of being more beautiful, more sophisticated, more stylish. Luxury fashion performs in a similar emotional way. So too does home fashion; it performs as an expression of someone's good taste in their personal environment.
The concept of luxury brand performance connects the intrinsic definition of luxury with the experiential. It is through performance that 'old luxury' (the noun) becomes transformed into the 'new luxury' that delivers an experience or an emotion.
Luxury marketers must measure the performance of their brands against the desires of their customers. They need to make certain that the brand incorporates all the promised intrinsic features, and delivers the experiential values that touch the consumer emotionally.
Luxury, corporate strategy and consumer psychology
The role of the luxury brand is to connect corporate strategy (which controls design and manufacturing, and develops branding messages) with consumer psychology (why people buy). It is through brand performance, both tangible and emotional, that the company delivers satisfaction to luxury consumers. Luxury marketers, while they must produce 'best of the best' products, must also realise that the product, in itself, is secondary to consumer experience.
It is on the experiential plane that luxury brands perform magic. Luxury jewellery and watch marketer David Yurman describes the experience of connecting with the consumer: 'We have a consumer religion. We are out there buying. It is sort of our God-given right. We think we can buy and we can get things for ourselves. But that experience is really almost a religious experience. It's like, 'Don't bother me. I am at the counter. Don't put that perfume on me. I'm here to search out that!' And when they hit 'that', that is their connection. So we've made a connection. These are very personal moments, these connections with consumers.'
The essential role of brands and branding in the luxury market is to influence the consumer in their purchase decision. Luxury brands become the medium through which we influence consumers to buy. Brands are the embodiment of corporate strategy, designed, created and directed by the company. The brand connects with consumers' psychology to encourage purchase. Luxury marketers who focus solely on the product and design the ultimate best of the best miss a huge opportunity to deepen their connection with the consumer. Quality items are fine, but do not necessarily motivate at the experiential, emotional level.
In our latest survey, a majority of luxury consumers found the greatest satisfaction in experiential rather than home or personal luxury purchases. And that means less money for marketers of home and personal luxuries. That is why it is imperative for every luxury marketer to embrace the experiential dimension. They need to make sure that their best-of-best product delivers the emotional, experiential satisfactions that today's luxury consumer desires .
The new luxury branding paradigm
Combining product features and benefits with consumer-centric luxury values is the new paradigm for luxury brands.
The business of communicating a luxury brand has become more complex, as marketers must make the leap beyond luxury product features and benefits to delivering experiential luxury performance.
The new generation of luxury consumers, the 76 million baby boomers aged 40 to 58, who are or will soon be empty-nesters, are not driven by crass materialism. They want more from life than simply buying another thing to display, another outfit, a new gadget. Today's luxury generation expresses a need to find a deeper meaning in life. They are more enlightened, less materialistic luxury consumers; we call them'butterflies', as they have emerged from their luxurious cocoons to reconnect with the world in meaningful ways.
Butterflies' consumption is driven by a desire for self-actualisation as described by Maslow in his hierarchy of needs. For luxury consumers who have an excess of material goods, a supportive family and a career that provides status and emotional rewards, self-actualisation becomes the ultimate goal.
This desire to become more and more what one is, to become everything that one is capable of becoming, explains the pursuit of self-fulfillment through greater spiritual enlightenment, the pursuit of knowledge, peace, appreciation of beauty, culture and aesthetics.
The branding challenge is to connect the dimensions of luxury features and experiences with the consumer. Today, luxury must deliver more than quality or design excellence. Luxury brands must deliver emotional rewards and experiential satisfactions.
The role of luxury branding cannot be separated from other purchase influences; the retailer or dealer brand, or price/value equation. All three influencers engage the consumer on the experiential plane. The retailer's brand encompasses the shopping experience, the thrill of the hunt, of finding something wonderful in a magical environment or, conversely, finding something wonderful in the most convenient fashion.
Price/value is also experiential. The joy of finding a good deal, or finding a $500 jacket for $250, are powerful motivators for shoppers. Remember, ultimately consumers do not buy because of the luxury brand: the brand justifies the purchase.
The true measure of a luxury brand is how well it delivers satisfaction, experientially. The luxury brand becomes the means to connect corporate strategy with consumer psychology. This is the new paradigm for luxury branding in the 21st century. It is all about the experience.
:SugarwareZ-167::SugarwareZ-167::SugarwareZ-167::SugarwareZ-167: