Features, expert advice & great top tips
Are you luxury enough?
Luxury is a market under the microscope. High-end consumers have become much more discerning about the purchases they make and will scrutinise brand credentials to a much higher degree.
Fortunately, real luxury brands have their own eco-system. They share a number of key characteristics, which clearly set them apart from more mainstream products:
Firstly, luxury brands are icons. They exude utter confidence in what they do and how they do it. This usually manifests as examples of over-engineering that signal to customers an obsession with quality or delivery beyond normal expectations. For example, Rolex has created a watch to work at up to 200m below sea level. Examples of over-engineering also provide great alibis or reasons to believe in the authenticity of the brand.
Secondly, they have real authenticity. This will typically stem from an inner conviction or belief that created the business or brand in the first place. For example, BMW with rear wheel driving, Mont Blanc with highly crafted pens that can work at high altitude and Hermes with its artisan approach to leather and saddles. The authenticity of the design, craftsmanship or service clearly signal ‘luxury’ to a potential customer. Patek Philippe watches even position the brand as an heirloom in waiting, with the ‘begin your own tradition’ strap-line.
The third key characteristic is scarcity or rarity. Increasingly, customers want to feel a sense of connoisseurship or discovery. Gucci has recently suffered a dip in results which it attributed in part to over-exposure and too many entry-level products. Interestingly, BMW has managed the clever trick of being the fourth largest-selling car marque in the UK without losing the brand cachet. The Kelly bag by Hermes is, of course, the best example of this – openly publicising the long waiting lists and encouraging customers to wait in line for ‘their turn’.
Using these principles and approaches, real luxury brands can retain their status and remain relatively unaffected by economic turbulence. They can hold their nerve.
The key is to avoid the temptation to chase sales by broadening their product portfolio, opening up distribution or even discounting products. This can cause real long-term damage to the reputation and brand. Pierre Cardin’s lengthy period in the wilderness and gradual comeback to date are testament to that brand’s overexposure in the 1980s.
For premium brands that run the risk of being caught out in the middle – neither value for money nor luxury – the solution is to quickly adopt a brand-building approach that focuses on key luxury brand behaviour. Certain elements are integral to a real luxury brand: building an authentic story, creating alibis that evidence that story, developing the notion of rarity or scarcity and allowing customers to create a sense of connoisseurship.
So to any brand out there looking to grab a share of the high net worth consumer’s pocketbook, there’s just one question it should be asking itself:
Do you feel luxury, punk? Well, do you?
