Luxury Marketing: Wants outweigh needs

Marketing luxury brands is about the emotional appeal of an image

Luxury Marketing. Does anyone really need an iPhone G3? For that matter, is there anyone who could not actually live without a cellular mobile telephone? Probably not, but in the recent introduction of the iPhone G3 in the United States, Australia and several other countries, millions have scrambled to be the first to get one and among them are people who really cannot (or should not) afford it. The iPhone G3 is probably one of the best, recent examples of an effective luxury marketing campaign.

Luxury marketing is not exactly a cakewalk

Luxury marketing is to marketing what cake is to bread—it is similar, has similar ingredients, but the expectation is nothing alike. Marketing luxury products is one marketing segment that is the more unfamiliar and more confusing to the marketer than other consumer products. Marketing luxury products is a specialized area that most marketing professionals avoid because of that lack of familiarity. Yet, luxury marketing is the most recession-proof. If a business wants to protect itself in tough economic times, it would be a good idea to keep luxury products in the product line. The reason luxury products are resistant to bad economic times is that buyers do not base decisions to purchase on need, durability or utility; they base their decisions on style, quality, glamour, and because they wish to stand out in a crowd. These buyers want the product; they do not need it.

“What’s all the hubbub, Bubba?”

The new model of iPhone was introduced a few months ago and the line-ups to purchase one were reminiscent of the line-ups for the last Star Wars movie. What causes such a remarkable hoopla over such a pedestrian product as a telephone device? Many of those lined up to purchase the iPhone would sleep in a car to save money, yet spend hundreds on the phone and up to $2,000 a year at ATT Wireless just to use its features. It isn’t the product that is needed; it is the status the product provides that is needed. The iPhone fulfills a need for status and exclusivity. The newest generation of consumers sometimes referred to as Gen-Y is picking up where Generation-X left off: a blurring of the difference between wants and needs. The basic characteristic of the generation is an “it’s all-about-me-and-what-I-can-do” attitude.

What is the main focus for branding luxury products?

Luxury marketing is largely about personal selfishness and indulgence. The primary audience is Gen-Y (the twenty-somethings), its predecessor, Generation-X (thirty- and forty-somethings) and the affluent buyers. Further, luxury marketing is not subject to the ups and downs of the economy because price is not the object. Actually, the price of the product is not a measure of quality or reliability as we all learned in past generations. Price is more of an indication of its scarcity or uniqueness. Think back three or four years ago to the introduction of another cellular telephone, Motorola’s RAZR. Although the RAZR commanded a high price, it was subject to failures and flaws that kept Motorola busy with its customers for many, many months. Quality and durability simply were not there but the uniqueness and cuteness of the product still commanded large sales, even throughout the troubled introductory phase.

What we once thought of as “rich people” has been replaced

Even the new definition of the luxury marketing audience is not the same as it was thirty or forty years ago. Our old definition of “rich people” focused on the “old money” population of inherited wealth, the elderly and white, male-dominated population. These were the children and grandchildren of the nineteenth and early twentieth century captains of industry. This audience bought Paris fashions, fine furs, and real gems in their handcrafted jewelry of unassailable workmanship.

The new products and the new “rich people”

The “new rich” is a completely different audience made up of athletes, film stars, rock singers, and trust fund kids. Even the children of the instant millionaires from the dot-com bomb era are part of it. In addition to all these people who have access to money (although many didn’t really earn it) there are what is known as aspirational buyers, or those who deserve to have the great, quality, latest-rage, cutting-edge items but really cannot afford them.

The Gen-Y buyer is at the heart of this audience and the iPhone is a perfect example of the promotion that rings bells with this growing and spending audience.

The appeal of the new generation of luxury products is different from the appeal of other consumer products. It is not about need, durability, utility or value. It is about exclusivity, scarcity, craftsmanship and innovation. Branding luxury products takes years of consistent promotion, focused solely on the attributes of luxury and pointed at the emotions of the new affluent buyers. The benefit, of course, is that successfully marketed products are virtually bulletproof when it comes to bad economic times.

Case Study

case studiesThrive Marketing helped Vala Dancewear create a brand identity for their new dancewear manufacturing company, which wholesales to dance retail stores across the US. The inspiration for the brand identity and accompanying marketing collateral is 1940’s Hollywood glamour. This is not only a big trend in the fashion world today, but also conveys the classic elegance that appeals to their high-end audience. bulletRead Case Study

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