Yesterday, I forgot to mention that I have successfully completed the 30-day Challenge. I am really proud of the fact that, with exception of a few days where things were beyond my control, I was able to write a blog post every single day, for 30 days. Now that I am done, I’ll slow down just a tad to work on some other projects I have. Now on to more pictures from NYC. Continue reading
30-day Challenge – Day 30
In the past two months, I have been to New York City twice. In fact, the first time I was in NYC was when I interviewed the CEO of Saks for this blog. The second time I went up to the “big apple”, I was with my classmates from the Real Estate CAM (Career Acceleration Module) at the Mason School of Business.
30-day Challenge – Day 29
In the second half of this past semester at business school, I took an immersion course in real estate – the best course I have ever taken. The course not only exposed me to the business of real estate, but also introduced me to the nuances of an industry where success is not necessarily about reality, but your ability to create a perception, in which people want to participate.
Real estate can give you a means to exercise your networking, negotiation and selling skills. At the same time, real estate allows you to be very creative in realizing your visions of developing mixed use, multi-family apartments, commercial, or industrial structures. You can literally do anything and the next lines will show that. Continue reading
30-day Challenge – Day 28
It’s been a wonderful and exhausting day. Our LuxRe Club did some consulting work for a large VA winery today, and I’ve been busy doing some necessary follow up.
Today I’m posting a link to an article, entitled “Top 8 Luxury Travel & Marketing Trends for 2012”. I recommend it not only because I read it, but because I do not believe I could give you the gist of it without omitting some important information.
If you are thinking of starting a new business catering to affluent consumers, I recommend you take the 10 minutes necessary to increase your knowledge. The article may validate or refute some of your perspective, but I can assure you that it covers a lot of ground.
I also recommend you read “To Market or not to Market? The No-Marketing Approach“. I read the following lines and couldn’t stop because it’s one of the best luxe conceptualizations I have come across:
We can live without luxury, and we are consciously aware that when we buy it we are spending our money on something we don’t need. So why, in an age of financial instability and austerity measures, is luxury spending on the rise? The decision to purchase luxury good is closely tied to the importance of freedom – freedom of choice, or the freedom to spend our money as we wish.
– Dr. Isaac Mostovicz, consulting academic
30-day Challenge – Day 27
I’m not much of a sports fan, but I couldn’t help but notice recent stories about the former Houston Rockets star, Yao Ming, releasing a line of luxury wines in his native China. Continue reading
30-day Challenge – Day 26
There are a lot of words and phrases to describe the typical luxury consumer. You could use: wealthy, affluent, moneyed, well off, well-to-do, prosperous, opulent, well-heeled, and a bunch of other colorful words. Though today’s luxe buyers can be segmented into different income and wealth categories, we have usually characterized luxury with the most affluent segments of society.
In my post entitled, The Pulse of Luxury, I discussed the definition of “affluent”: those earning incomes of $100,000 or more. For the longest time (or as long as I’ve been around – not too long), much of the literature has considered $100,000 as the “rich” threshold. Well, if you read that post, you will remember that I raised a question as to whether we need to keep using that description because it does not seem to take inflation into consideration or consumer sentiment. Continue reading
30-day Challenge – Day 25
There is a well known adage about business success in relation to a customer’s experience:
A happy customer tells one friend, but an unhappy one tells everybody
Today, I write as both a happy and unhappy customer with experiences in the same product category, from two different brands. More importantly this post is so realistic, it serves as a practical case study on how to deliver the best customer experience possible – whether you are in the luxury, mid, or low product/service segments. Today’s post is about restaurants, and based on the title of this blog, I’m talking about fine dining. I’ll talk about two specific fine dining experiences I had on Sunday (12/11/11), while taking my darling wife on a day of dedicated DSE (dining, shopping, and entertainment) in the Williamsburg, VA area. Continue reading
30-day Challenge – Day 24
For a company with revenues in excess of $6.5B, Swatch is considerably the worlds largest watchmaker. The Swiss company recently received approvals from the regulatory agencies to stop supplying competitors with the movements they use to make their timepieces. This is an ironic twist of events, because I am forced to ask myself, “why didn’t Swatch’s competitors invest in producing their own inner workings?”
Aside from writing on this blog, I’ve got some other nice skills, particularly in the areas of financial analysis and valuation. I am also fortunate to be part of a select group of MBA students, who manage approximately $500K for the Mason School of Business. In my duties as an equity analyst for The Batten Fund, I cover the consumer staples & discretionary sectors, and as such all the securities associated with luxury firms fall under my purview.
Yesterday, Francesco Lavecchia, an equity data analyst with Morningstar Italy published an opinion piece on the biggest decision luxury brands are facing in their bids to enter the growing Asian market. There are two choices lux companies have in conquering Asia: Continue reading
30-day Challenge – Day 22
As my classmates and I get closer to graduation in May 2012, the anticipation of finding a job only increases. Today’s post will shed some light on where some luxury companies may be hiring – specifically hospitality.
Hilton Worldwide recently made an announcement of its intention to add more than 8500 new jobs in Europe by 2014. Check out the press release here.
The company is opening more than 110 hotels in Europe, via new builds and conversions. Key growth markets for the company include the UK, Russia, Turkey, Germany and Poland.
A range of award-winning training and development initiatives are also available at Hilton Worldwide such as the fast-track graduate programme, Elevator, which identifies and nurtures talented graduates and high potential candidates from within Hilton Worldwide. These rising stars go through a thorough 18 month training programme before assuming their first management position, and then are usually fast tracked to senior leadership positions, with the aim of developing into successful hotel general managers.
30-day Challenge – Day 21
If you are an affluent consumer earning more than $100,000 in annual income, then the recent report by Bain & Company on diamond prices should worry you. If you make upwards of $250,000 a year, then you shouldn’t be as perturbed because you will not be greatly affected by the forecasted jump in diamond prices.
The global consulting firm has put out a report estimating that diamond demand will grow at a 6% CAGR over the next decade. The company believes that as we approach 2020, diamond supply will not be able to keep up with demand due in part to the growing economies of China and India. Those markets alone are estimated to push diamond demand at a CAGR of 6.6% in diamond volume alone. While demand is estimated to grow, diamond supplies are only expected to grow by 3% (CAGR) in volume. Continue reading
30-day Challenge – Day 20
A while back, our business school, the Mason School of Business, was visited by Tetsuya O’ Hara, the Director of Advanced R&D. It was a momentous visit especially for students who had never heard of this manufacturer of outdoor gear and apparel.
One thing Tetsuya told us about the company, was in regards to the new marketing campaign it was executing. Basically, Patagonia was asking its customers not to buy its products – for environmental reasons. As a professional in the luxury market, this certainly looks like a great way to market your product. However, there is some sincerity behind the company’s plea.
30-day Challenge – Day 19
As long as time continues, tastes will change, new desires will emerge, and premium goods and services will be valued above their regular substitutes. However, the definition of luxury will be a moving target depending on cyclical economic patterns and societal mores on the exhibition on wealth.
I have been reading a couple of books to help my thought on luxury and they all say the same things differently. Most of those books were published in times when special circumstances were affecting the luxury market (think 2001 dot-com bust or the 2007 housing bubble).The intention of this post is to bring attention to one of those varied views on luxury, but this one is important because, unlike the books I’ve been reading, this perspective has its relevance in the now, and it is supported by empirical data.
Ipsos Mendelsohn is an international market research company ranked high in the global playing field. For the past 35 years, the company has put out its annual Affluent Survey, a study of affluent households (incomes of $100,000 or more) in the US. The survey has been a key reference for many luxury brands because it is considered a reliable measure of the pulse of the US luxury consumer.
As a side note, I will say that the definition of affluent doesn’t seem to have changed in the last 7 years. Most, if not all of the books I have been reading use the same income definition. I wonder if we should think about changing that number especially because of the effect of inflation, or the fact that some luxury items are no longer accesible by just the wealthy – but I digress.
The results of the latest Affluent Survey warrant a view not just from those currently in the industry, but also from people looking to get hired in the space. These results may not tell you what the next best innovation will be, but if you are truly passionate about serving this specific segment of consumers, it might be useful to draw upon these insights in your interviews and casual conversations with luxe professionals.
I wouldn’t recommend anything I haven’t tried, so be rest assured your reading time will be well spent on these publications. You can get the gist of the survey in two different ways:
- Justluxe.com interview with Stephen Kraus, chief research and insights officer at Ipsos Mendelsohn
- Article entitled, “Affluency: New Definitions of Luxury“
Let me know if you see something unique or worthy of comment.
30-day Challenge – Day 15
I am devoting today’s post to Leaders in Luxury, a series of insights from esteemed professionals leading global luxury brands. My thanks go out to FT.com for making these available. Enjoy…
Sung-Joo Kim, head of MCM Group, on her career and the business of luxury
Leonard Lauder, Chairman Emeritus of Estee Lauder on the next luxury consumers.
30-day Challenge – Day 14
If you have been in touch with much of the happenings in hospitality, then you would have noticed a huge emphasis on rolling out more value-added services to complement the commoditized room revenue segment. Over the past year, one of the hotel and travel components being actively pursued by hospitality groups, developers, and licensees alike, has been spa services.
I can’t remember where I heard or read it, but someone once said something very profound about luxury brands:
Luxury brands don’t discount, they add value.
30-day Challenge – Day 13
Today, I am going to highlight an ingenious new brand platform put out by Ritz-Carlton. If you don’t want to read the post and just get to the core of an exciting and counterintuitive differentiation strategy, play the video below.
30-day Challenge – Day 12
Today, I am looking at emerging themes in luxury with a focus on the hospitality industry. With rooms becoming commoditized, hotels have but one option to capture the hearts of its customers – differentiate. How do you differentiate one luxury hotel brand from another? Well, for starters we are way past thread counts, serving sumptuous breakfasts, and delivering the morning newspaper. Upscale hotels are having to differente themselves on the experiences they can provide their guests. In the next posts, I’ll talk about how some hotel groups are doing just that. We’ll kick off the series with Orient Express. Continue reading
30-day Challenge – Day 11
Over the course of writing this blog, I have learned a lot by covering the evolving themes in the business landscape occupied by premium brands.
For any of my readers interested in working in the luxe space, these themes are what I believe will dictate and most possibly define their success. I have talked about luxe-related issues ranging from social media to responsible business. Today I want to talk about sustainability. If you have already got a dose of this in my earlier posts, then I am re-emphasizing it in light of recent news articles highlighting how some brands are introducing sustainability in their corporate strategies.
Who would have ever known that acclaimed jeweler, Tiffany, would build a dedicated web page to highlight its efforts in corporate social responsibility (CSR); or that the renowned Peninsula Hotels would make a bold (and maybe costly) decision to stop serving shark fin in its restaurants?
Well, its happening all around us today. Whether or not you believe in the sincerity of these varying corporate initiatives, sustainability is no longer a matter of lip-service. Brands are actually paying attention to many of the concerns of consumers. In his opinion piece on luxurysociety.com, Leslie Pascaud, Director of Added Value Paris, discusses why luxury brands should and will embrace sustainability in the near future. See the article here.
30-day Challenge – Day 9
One thing that I highly admire about companies in the luxury segment of any product or service category is the uncompromising passion with which they pursue their strategic goals. I have never been a fan of trying to be everything to every consumer because it is not always an efficient way to drive your business. However, I do believe in leveraging your brand in any way possible to reach your current and future customers. That brings us to today’s topic on co-branding. Continue reading
30-day Challenge – Day 8
The term “luxury” evokes a multitude of disparate meanings for different people. For some luxury is synonymous with “expensive”. For others it can be associated with “unique”, “exotic”, “rare”, “sophisticated”, or “exclusive”. However, I want to make you aware of two words that I feel are most synonymous with the definition of luxury today – “custom” and “bespoke”. Continue reading
30-day Challenge – Day 7
Today, I am both glad and proud to write about a company, with which I have done business: both as a pre-MBA professional and as a consumer. I have to say that I wasn’t surprised when I came across this article announcing Hilton Worldwide’s initiative to give people around the world better access to the hygiene that can help prevent fatal illnesses such as diarrheal diseases and pneumonia.
In partnership with the Global Soap Project, Hilton Worldwide is leading the charge to help develop a cost-free way for hotels around the world to recycle left-over bars of soap, which are provided to guests during their stays. In the first year of this partnership, Hilton Worldwide expects this investment to result in the donation of more than one million new 4-ounce bars of soap to people in need. Learn how it works here. Continue reading
30-day Challenge – Day 6
Today, I found another brand that cares about its social and environmental impacts. It’s also not surprising that this brand is associated with the LVMH family of brands (more than 65). One reason I admire LVMH is that it is a company that is comfortable with being the leader in just about every luxury segment. And now, Bernard Arnault is pushing his massive company past another frontier with Edun. Continue reading
30-Day Challenge – Day 5
Since my last post, I have begun an investigative search to identify brands that actually care about the issue of responsible business. I am not talking about businesses that pay lip service to corporate social responsibility (CSR), but brands that truly try to act responsibly in all ways. Continue reading
30-Day Challenge – Day 4
Yesterday, I watched a documentary describing the tumultuous experience of workers in the garment manufacturing industry, as they campaigned for better wages and working conditions. Titled Made in LA, the documentary follows “three Latina immigrants working in Los Angeles garment sweatshops as they embark on a three-year odyssey to win basic labor protections from a trendy clothing retailer” (http://www.madeinla.com).
While putting aside my political and economic views on the subject of immigration, my mind focused on the theme of responsible business – that is doing business the right way and ensuring that all who partake in commercial activities receive benefits (economic and otherwise) that are in line with their inputs. As this concept continued to stir in my head, I had a moment of pure enlightenment. Rather, it was an unanswered question: do brands (luxury brands in particular) care about the things I care about, specifically responsible business?
As the son of a diplomat, I’ve grown up an advocate of all things fine, unique and exclusive. If you think, I grew up with a silver spoon, then think again. My taste and refinement came as a result of the people and cultures, to which I was exposed. I was raised to understand that anything considered unique, exclusive, rare, and pleasurable had a right to be deemed luxurious. More importantly, I learned about the relativity of luxury – what might be luxury for me may be a staple for you. In third world countries, where ample food and water are especially rare and exclusive to the rich, wouldn’t they be considered luxury items.
So you might ask how does this all relate to a blog about an industry focused on goods that some will say are inaccessible to much of the world’s population? At this point I don’t know, but I intend to find out a little more in the coming posts.
30-Day Challenge – Day 3
Yesterday, I highlighted one obvious problem brands face when employing social media in their marketing strategies. Today, I’m continuing that post with some focus on possible solutions.
Going Where Your Customers Go
Brands need to understand is that social media can influence the decisions of its consumers, especially in the longer term. Luxury companies should be more interested in it because it allows them to communicate with current and future customers. Rather than developing accounts on all the available platforms, companies can start by figuring out which social media tools are being used by their consumers. This reminds me of Mark Bonchek’s (SVP of Communities & Networks, Sears Holding Company) advice on sociographics.
The fact that social media exposes your brand to an exponential amount of customers (for whom you may not be able to count on for a future purchase) forces luxury brands to see it as a threat. Conventional perspective in the luxe space portends that social media could cheapen brands by exposing them to customers that don’t fit their target psychographics. However, if it is done right, social media can give your brand a connection to the next generation of consumers. It would help to mention Coca Cola and Pepsi at this point because both are such iconic consumer brands. These companies have done well in mining their own business intelligence to determine one of the critical times when beverage consumers are most likely to develop their taste preferences – in their college days. As such, Coke and Pepsi spend a lot of money, competing for the exclusive rights to sell their products on college campuses across the US (and obviously the globe).
In the same vane, social media has an influencing capability where users-turned-brand-advocates (evangelists), can help create brand desire within their networks. There is great opportunity for brands who start to view social media more as a long-term brand builder rather than a click-thru conversion enabler. In his article, Rony Zeidan (of RO New York Inc) says:
Advertising has been traditionally about making products desirable, about infiltrating the minds of people to create needs and fuel desire from one particular source. It communicates with consumers, promotes products, creates brand identity, and generates brand awareness.
Social media is the new tool of advertising, and it could be a better marketing tool than the interruptive conventions advertisers have used. I used the term interruptive because traditional advertisements (TV, billboards, and print) have formats that require your focused attention (away from the show or article you really wanted to watch or read) on what the brand is trying to tell you. Today, social media has the power of creating conversations that are user generated, allowing brands to be part of a more intimate and voluntary relationship with consumers. They may not have control over what people are saying, but brands surely have a more proactive capability to know and affect what the market really thinks about their products.
Social media has the potential to introduce brands – whether they are considered household names or deemed obscure – to markets that were never accessible. It takes word-of-mouth marketing (the best ever for luxury products) a step further by amplifying the brand message. The only thing that that firms have to actively ensure, is that they are using the right social media tools to reach their target markets. To do that they need to go where the customers go.
I enjoy writing about these topics. Blogging is both cathartic and enlightening at the same time. Let me know if you’ve gained something from my perspective.
30-Day Challenge – Day 2
On my way to school this morning, I had a conversation with one of my classmates about the thin line bloggers and social media publishers straddle between overuse and underutilization of the social media apparatus. Since starting this blog, my objective has developed from just gaining exposure to the luxury goods and services segments, to making connections with people that have similar interests. I’m not worried about how many followers I have (make no mistake I am thankful for my handful); how many facebook “likes” I get; or how many people choose to comment on my posts. I am more interested in the discovery of other publishers, consumers, and readers who have an iota of perspective on the topics I discuss. Continue reading
30-Day Challenge #1
I said I would have my first post in 24 hours, but I couldn’t hold the excitement of my first entry in the 30-day challenge.
While rummaging through my ever-thinking cerebrum for something to write, I found it difficult to focus on just one particular topic. I am interested in a lot of things, so why should I have to limit my posts to just one story or event in the world of high-end goods and services.
I decided to write on themes that are taking place in the luxury and retail space. Today’s theme is a pretty nebulous one: social media and digital marketing in the luxre (a pun resembling the offspring of luxury and retail; and also the name of my club at W&M ) space. Continue reading
As someone new to the blog sphere, it has been difficult to maintain some level of consistency in the frequency of my blogs about issues in luxury goods and services. Today, I am taking cue from fellow blogger, Greg Fitz (aka the social media ringmaster) of Create and Consume, and I am signing on to his 30-day challenge. The challenge is basically to blog about something each day for the next 30 days.
The challenge is inspiring because it is an authentic effort at making yourself accountable. It is also an effective way to be more creative because “any creative breakthrough inevitably rests on the shoulders of all that came before it. For a painter, that might mean studying the masters” (from Tony Schwartz on How to Think Creatively). For me, the next 30 days will involve a lot of reading on a wide range of topics in luxury and retail which I believe will be more randomly selected and varying than my current set of posts.
If you have just read this post, thank you. Look out for my first entry in the 30-day challenge in the next 24 hours.