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Session 1 - Introducing to the world of luxury & Luxury Marketing…
Session 1 - Introducing to the world of luxury & Luxury Marketing uniqueness
Defining luxury
Luxuria
(extravagant living, excess/abundance)
=/ Lux
(light/shiny)
=> pejorative word "self-indulgence"
17th cent
= accessible to royal court, linked to arts/leisure
19th cent
= Social Status Veblen Effect Contradiction of law of D => qty demanded has an inverse relationship w/ px
20th cent
= Bourdieu, 1979 Social Capital – Taste Leadership
Keywords
Beyond pricy
Individual
Hedonism
: pleasure, beautiful, surprising
Identity
: power/success; status; elevation
Functional
Quality
: handcrafted, superior, authentic (essence of craftsmanship, quality, customer service)
Uniqueness
: limited, rare, creative, inspirational
Social
Ostentation
: elistism; for the very wealthy; exclusive
Luxury marketing
Generations in Luxury Marketing
Young (Millenials & Gen Z)
Polarizing prefs on fast to adopt, new tech, values sustainability, seek guidance from community (ex: influencers on social media)
Luxury market expected to double grow by 2026
Older
Luxury market expected to decrease by 2026
Polarizing prefs on experiential luxury (hotels, wellness...), seek professional guidance
Strategies
Short-term
Capture both segments with tailored strategies
Mid-term
Loyalize Gen Z & Millenials
• Create a new value
• Recruiting New Customers
• Selling more to existing buyers
• Story telling
• Offering more than the product (symbolic benefits)
• Managing accessibility & price carefully
Change in luxury
...In social value
Need for Uniqueness
Being unique & different from other persons
=> More customization / Less predictibility
Three-dimensions
Creative choice counter-conformity = within the limit of social boundaries
Unpopular choice counter-conformity = uniqueness by breaking social barriers
Avoidance of similarity = discontinue commonplace items
Need for status
Social standing through visible consumption to symbolize wealth & power
... In personal value
Brand essence
Aspiration – Be extraordinary
Self essence
Authentic – Be myself
Be unique but still recognize the brand & its’ vision
Luxury value perceptions
Social value
(conspicuous, prestige value)
Individual value
(self-identity, hedonic, materialistic value)
Functional value
(usability, quality, uniqueness value)
Financial value
(price value)
Producing luxury
Key pillars
Triangle
- Heritage (on top), Creativity (bottom left), Experience (right bottom)
Heritage
(History, core continuous values, use of symbols)
Creativity
(Constant Innovation, new design; Imposing a vision)
Experience
(Emotional, Empowering)
Heritage
(Constant Innovation, new design; Imposing a vision) vs
Present
(Elements of Modernity / Trendiness)
Design
Key role of the Designer
= From creation to prototype Modelisti (interpret ideas) -> Prototype (made real)
Exceptional experience
Emotional
(private events)
Self-oriented
(self-esteem/care; gift-giving)
Empowering
(celebrity, influencers, community of owners)
Business approaches
Marketing development
= Strategy approach
3 channels of distribution
Operational Marketing
(Subsidiaries; Export; Travel Retail)
= Commercial approach
Operational manager role
Brand Management
Developing a brand's identity/reputation. It involves creating a consistent brand experience from marketing materials to customer interactions
Trade Marketing
= focuses on building relationships & partnerships w/distributors, wholesalers, & retailers to promote & sell products or services
Product daily life
Product Category Management
• Sales monitoring
• Review of Model Stocks
• Shortage management
Allocation
• Management of the automatic allocation system
• Stock Exchange
End of product life
: Stock Out; Private Sales; Recycling
Luxury categories
Opportunities & Challenges
Sustainability
(pressure for more ethicality; stricter gov./reg.; rise of 2nd hand market)
3 pillars
(People, Profit, Planet)
Digital/AI/evolution of channels
(new tech in value chain)
International development
Categories
Personal goods
Cars
Hospitality
Gourmet food/drinks
Furnitures
Art
Qualities to work in Luxury
(Rigorous; Flexible; Self-improvement; Risk Taking)
Sustainability & Luxury
Opportunities
Enhance their brand image & reputation
Attract new customers (Millennials & Gen Z)
Reduce costs
Build stronger relationships w/ suppliers
Innovate & develop new products
Need for transparency / facts / creative solutions
Need for concrete actions to be more sustainable : using sustainable materials, reducing waste, labor conditions for employees, and promoting fair-trade practices
Challenges
High cost of sustainable materials & practices
Consumer perception
Greenwashing
Luxury & Digitalization
Luxury
= Exclusivity; Personalization; Customer services; Exquisite servicescape; Creativity & innovation
Digitalization
= Convenience; Unlimited access Always just a few clicks away; No barriers to browsing; Gaming & Fun
Luxury & Gamification
Advergame
Video games specifically designed to promote a product or service (ex: Pepsiman; Angry Birds Rio colab)
In Game Ad
ex: objects in the game (LVMH skin; M&M's incorporated ad...)
Luxury & NFT