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 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 16
The fact that I’m currently traveling in NY is no excuse to miss out on making my 15th post in the 30-day challenge. However, as I type this post on my mobile phone, from a cab going down E 57th, I must say that I will be rather brief today.
From time to time I get emails from friends, faculty, and strangers about interesting articles on luxury products and services. A good friend of mine, Eric sent me an article by Duke Greenhill, founder and CEO of Greenhill+Partners, an agency for bespoke luxury brand marketing.
We have all learned about the 4Ps of marketing. In fact, I think some marketing nerds might have it tattooed on their foreheads. In his post on Mashable.com, Duke discusses the 4Es. I read it and believe it is worth the time it takes you to click the links above . At the least, you can add another marketing acronym to your bag of buzz terms.
You can now congratulate me on my first mobile post from a yellow cab (now on W 57th). See you tomorrow.
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 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.