Luxury Branding and Marketing Blog for KODA » Articles

Celebrities in Advertising

admin — Mon, 21 Feb 2011 18:14:03 +0000

A recent post we found on Branding Strategy Insider does a fantastic job of validating the ineffectiveness of celebrity endorsements in advertising. Most consumers and marketers would never expect to see the return on investment fall as flat as it does.

Celebrity endorsements may have their place, however the evidence demonstrates how many advertisers are simply following the leader and doing what has always been done without taking an objective view of the data to make sound marketing decisions.

Great read!

The Importance of Brand Heritage

admin — Thu, 04 Jun 2009 16:07:55 +0000

Interesting article below regarding an aspect of branding we push on a daily basis at KODA. Many accept the idea during a conversation but execute very poorly due to their fascination with the newest, and greatest. There is a lot to be said for your roots and your customers are the ones asking.

Read Article: The Importance of Brand Heritage

Return On Design

admin — Mon, 09 Mar 2009 19:23:18 +0000

Seth Godin makes some very valuable points on the value of quality design
Original Article

Return on investment is easy to measure. You put money in, you measure money out, divide and prosper.

But return on design? (Design: graphics, system engineering, user interface etc.)

Design can take money and time and guts, and what do you get in return? It turns out that the sort of return you’re getting (and hoping for) will drive the decisions you make about design.

I think there are four zones of return that are interesting to think about. I find it’s more useful to look at them as distinct states as opposed to a graduated line, because it’s easy to spend a lot of time and money on design but not move up in benefits the way you might expect. Crest might have a better package than Colgate (or the other way around, I can’t remember), but it doesn’t sell any more units…

Negative return. The local store with the boarded up window, the drooping sign and the peeling paint is watching their business suffer because they have a design that actually hurts them. Software products suffer from this ailment often. If the design actively gets in the way of the story you tell or the utility you deliver, you lose money and share.

No impact. Most design falls into this category. While aesthetically important, design in this case is just a matter of taste, not measurable revenue. You might not like the way the liquor store looks, or the label on that bottle of wine, but it’s not having any effect on sales. It’s good enough.

Positive return. We’re seeing a dramatic increase in this category. Everything from a bag of potato chips to an online web service can generate incremental sales and better utility as a result of smart design.

The whole thing. There are a few products where smart design is the product (or at least the product’s reason for being). If you’re not in love with the design of a Porsche 911, you would never consider buying it–same as an OXO peeler. The challenge of building your product around breakthrough design is that the design has to in fact be a breakthrough. And that means spending far more time or money than your competitors who are merely seeking a positive return.

Knowing where you stand and where you’re headed is critical. If you have a negative return on design, go ahead and spend enough money to get neutral, asap. But don’t spend so much that you’re overinvesting just to get to neutral. Watching a local store build an expensive but not stellar custom building is the perfect example of this mismatch.

If you’re betting the whole thing, building your service launch on design first, skimping on design is plain foolish.The Guggenheim in Bilbao would be empty if they’d merely hired a very good architect.

Luxury Lifestyle Marketing defined

admin — Thu, 05 Mar 2009 05:05:53 +0000

Luxury Marketers Can Transit From Instinct To Info-based Decision-making

by Richard Baker, Yesterday, 5:00 AM
original article

Marketers of goods and services for high-net-worth households (top 2% income, 1% of assets) have historically operated on the instinct of their founders or designers. But as the economy presents new challenges, as competition increases, and as leading competitors become publicly owned, reliable information and systematic decision-making processes are required.

One approach is Lifestyle Marketing, the strategy of appealing to the pattern of underlying values (personal drivers) and tangible benefits (attributes) that create harmony in a target Life Style segment. The Lifestyle Marketing process involves a series of nine steps, the first four of which are summarized here.

Defining the lifestyle of the target consumer
Lifestyle is a better tool statistically for segmenting affluent consumers than everything except gender. It is more likely than age, income, education, zip code, etc., to predict what affluent people will do and why. Targeting a Lifestyle, rather than a demographic, provides a more detailed definition of the best prospect, how many, why they buy and specifics about how to reach them.
Project the desired results
Lifestyle segments are statistically projectable to the affluent U.S. population, especially the hard-to-measure top 5%. If a brand has a goal of achieving a certain share of market at a certain price point, it can break that into shares of specific Lifestyle segments. This step allows the development of budgets, projecting marketing ROI, etc., to form the basis for making decisions about advertising, communications, distribution, channel support, and the other tactics in the marketing mix.
Positioning
Lifestyle segments have clear priorities regarding which values (personal drivers) they are interested in satisfying. Some luxury brands refer to priorities as “passions.” A brand can compare alternative positioning within a Lifestyle segment to determine which of the high priority drivers (passions) it can be most competitive and successful in satisfying. For example, Lexus focused on satisfying the personal drivers associated with “practical” and “avoiding social discomfort” whereas BMW competes on “makes me feel good” and “performs as intended.”
Product and service differentiators
After deciding on the personal drivers, the marketer must decide which tangible product and service attributes provide proof that the needs will be satisfied. Again, the importance of these attributes varies by Lifestyle. This step would be very important in marketing any activity, such as travel, which has a cultural aspect. For example, each Lifestyle places a different priority regarding the relative importance of culturally related activities when traveling.
Developing an integrated multi-channel strategy
Today most consumers, even the most affluent, shop multiple channels. But luxury brands are often tentative about developing multi-channel strategies. There is a concern that marketing in the more direct channels (catalog, internet, direct sales, etc.) will create confusion or lower the perceived prestige of the brand.
Word of mouth
Recommendations from peers and family are the greatest influence on all Lifestyles. The principle communication question, then, is “how to create positive word of mouth.” The answer varies by Lifestyle with some more influenced by publicity and editorial than by advertising.
Relationship building
Many premium brands are already shifting more money into “non-traditional” modes that emphasize creating links with many aspects of an affluent consumer’s life. For example with non-profit organizations the affluent cares about. Involvement with these organizations (we call it “social networking”) creates access and intimacy.
Personalization
Lifestyle Marketing provides real personalization in direct marketing. Customers in a ZIP plus four do not have the same motives for consumption. (We say ZIP is worth zilch: Birds of a feather do not flock together.). Marketers need a database, which identifies the Lifestyle of each individual household in the most affluent areas to target messages to the personal drivers and preferred attributes of each recipient.
Alignment
Finally, after a Lifestyle Marketing strategy is developed, the marketer can check to ensure that there is alignment of all elements in the marketing process. Only a research-based framework can guide decisions at each step of the marketing process.

Marketing in an economic downturn

admin — Fri, 12 Dec 2008 17:46:01 +0000

I really enjoyed this article about other ways to connect with your consumer in times of economic turmoil. Stephanie Kang provides both sides of the equation for a great read. Enjoy!

Designating Shortcuts to ‘Happiness’

Warmth Gets a Workout as Marketers Grope for Pitches That Will Resonate in a Recession

Original Article

By STEPHANIE KANG

Be happy. That’s one message marketers are trying out, with ads evoking warmth and good cheer, as they cast about for ways to appeal to consumers amid a recession.

Best Buy’s holiday campaign, created by Omnicom Group’s BBDO, includes TV spots featuring true stories of how Best Buy touches its customers’ lives. Employees of the consumer electronics retailer submitted stories, and documentary filmmaker Errol Morris filmed them telling their tales.

In one ad, an employee talks about selling a Webcam to a man whose grandchildren are moving abroad. Another shows a Best Buy employee teaching a blind man how to use his home-theater system. The tag line for the campaign: “You, Happier.”

Carnival, the Miami-based cruise company, faces its own challenge in trying to persuade consumers to invest in sun and spray as their retirement savings dwindle.

Carnival and its ad agency, Havas’s Arnold Worldwide, decided to throw a party — to be showcased in TV, outdoor and online ads — around efforts to break two Guinness world records. Thousands of people gathered in Dallas to play with the world’s largest beach ball (about the size of a 2,500-square-foot home) and break the world’s largest piñata, six stories high and stuffed with four tons of candy. The tag line: “Fun for All. All for Fun.”

“If there’s ever a time we’re living in pressure and stress and not having enough fun, it’s right now,” says Ruben Rodriguez, executive vice president of marketing and guest experience for the company’s Carnival Cruise Lines. “Fun is good for your health.”

Other marketers, from JetBlue Airways to J.M. Smucker’s Hungry Jack brand, are slipping the H-word into ads this holiday season.

Marketing executives say it is a classic strategy during recessions, or after traumatic events like the terror attacks of Sept. 11, 2001. The idea is to break through to consumers who are being inundated by depressing news. “In all this doom and gloom, happiness is the obvious counterpoint strategy,” says Nick Bartle, director of behavioral planning for Omnicom’s BBDO North America.

It has obvious risks, too. Grinning through your ads in a rotten economy when consumers are deeply concerned about their financial future can seem insensitive or obtuse. “It does have immense pitfalls if executed improperly,” Mr. Bartle says. “You could look like a brand with its head in the sand.”

To do it right, he says, marketers have to be specific about how their products offer happiness, whether it’s a cigar that brings comfort to the smoker or a toy that makes the consumer smile. They also need to be careful about the placement and timing of the spots, he says, recalling a whiskey ad celebrating Ireland that ran in the London market shortly after an attack by the Irish Republican Army. Running an optimistic ad after a particularly steep stock market drop could also backfire.

“It’s tricky to pull off,” says Allen Adamson, managing director at Landor Associates, a branding firm owned by WPP PLC, “because being effective in advertising is communicating that you understand what’s in your customers’ heads. And clearly what’s in people’s heads right now is concern about the economy.”

Still, there are signs that consumers might be ready for a little fun. The comedy “Four Christmases” has been No. 1 at the box office for the past two weekends, beating the brooding teen romance film “Twilight” and the romantic epic “Australia.”

At CBS and NBC, comedies have been strong so far this season, and network executives take that as a sign that viewers are looking for lighter entertainment.

If the happy campaigns do spur consumption, it will be timely. Best Buy recently reported lower-than-expected sales and reduced its earnings guidance.

Greg Johnson, Best Buy’s senior vice president for marketing, says company executives debated whether the happiness theme would be effective when they began discussing holiday marketing strategies this summer.

“We knew things like price and value would be important,” Mr. Johnson says. “We also wanted to make sure we’re connecting emotionally at a time like this.”

Write to Stephanie Kang at stephanie.kang@wsj.com

Creepy or incredibly innovative.

admin — Wed, 10 Dec 2008 05:32:53 +0000

This is a pretty cool concept. Check out this article I received in my email. What a unique way to creep people out.

Jameson Whiskey Texts Targets On N.Y. Streets

by Les Luchter, Friday, December 5, 2008, 4:47 PM

Insert live text messages directed at passersby into projected outdoor billboards and you’ve got an innovative new campaign created by Omnicom’s TBWA/Chiat/Day New York on behalf of Pernod Ricard’s Jameson Irish Whiskey.

The traveling ad show was set to launch in New York City Friday night, at high foot-traffic locations in Chelsea, the Lower East Side, Brooklyn’s Williamsburg–and a fourth site still undetermined as of late Friday afternoon when Marketing Daily spoke with TBWA/Chiat/Day Creative Director James Cheung.

The projected ad moves from place to place in search of Jameson’s target audience, Cheung explained. For instance, if the Knicks had been playing basketball at Madison Square Garden, that neighborhood could have been a target.

Once in place, the ad is projected onto a wall and a person begins typing real-time text messages aimed at specific people passing and then responding to their reactions (such as “Yes, you, in the blue shirt”). The projections are provided by event marketing agency City Eventions with–at least for launch night–the texting handled by Cheung himself.

As he awaited his debut on the streets, Cheung called the live ads a combination of “chatroom, out-of-home and conversation piece,” adding that he was unaware of “anyone else who has done this before.”

The conversational wall projections will move on to Los Angeles on Dec. 19, while projected ads without the live messages also begin this month in Boston, Chicago, Denver and Minneapolis. Jameson has also launched a new radio ad in 20 markets, and a trade campaign highlighting that the brand is “Defying the Economic Downturn.” Jameson cited AC Nielsen figures showing dollar sales up 33% in the six-month period ending mid-October.

Original Article

Luxury Brands: Marketing the Upscale During a Downturn

admin — Thu, 13 Nov 2008 14:42:18 +0000

This is a great article providing insight on the luxury market in this economy. I typically stear away from some of it due to media hype and being plain sick of it. However, this article has a bit of both sides, but more importantly it explains the value of maintaining brand integrity even in the down economoy

Published: November 12, 2008 in Knowledge@Wharton

As 2009 shapes up to be the most challenging year in more than a generation for luxury items such as high-end apparel and fragrances, marketers’ plans for targeting aspirational 16-year-olds and expanding rapidly into the new money hubs of Russia or the United Arab Emirates are suddenly “out,” according to a panel at the recent Wharton Marketing Conference. What’s now “in” for marketing luxury in this difficult era is pampering the wealthiest and most loyal customers with everything from monogrammed shirts to personal in-home visits.

“I really think the foundation of luxury is customer service — that is what we are hearing,” said panelist Cori Galpern, worldwide marketing and advertising director for Tom Ford International, the designer’s growing chain of fashion houses. “I think what we’ll see because of the economic crisis is that you lose a certain amount of that aspiration customer. Somebody who will buy a couple pairs of shoes over the course of the year is making other choices. The core for a luxury brand is a customer with very considerable wealth.”

The issue of who will remain wealthy over the next two years, and how they might spend their disposable cash, was very much on the minds of the panelists, including top marketers with experience at some of the most storied names in luxury items and apparel — from Gucci and Prada to Tom Ford and L’Oréal.

Upholding Your Brand

The panelists agreed that in a recession in which even upscale consumers may find themselves strapped for disposable cash, it is a bad strategy to chase customers too far down the economic ladder. “We don’t want to see huge price cuts that will create a lower-priced brand,” said Brad Farrell, skincare brand manager for L’Oréal Paris. “That’s because you don’t want to tarnish your brand. When this is all said and done, you still have your brand reputation to uphold.”

Indeed, the deepening economic slowdown was such a hot topic for these luxury marketers that there was surprisingly little discussion of the panel’s planned topic: “Targeting the New Luxury Consumer in a Flat World: Identifying Opportunities for Growth in a Global Luxury Market.”

Several of the panelists said their firms remain hopeful that the next couple of years will bring expansion into some of the world’s fastest-growing economies, including the so-called BRIC nations of Brazil, Russia, India and China, as well as the oil-rich Middle East. But they added that the rapidly evolving financial turmoil could hinder some of their most ambitious ideas. Alexandra Gillespie, who launched her own FLR Group for luxury marketing after a stint as senior vice president of Gucci, warned about “focusing too much on the luxury sector in emerging markets” because they, too, have been deeply affected by the economic downturn.

Many experts believe that the economic pain of the deepening recession could fall disproportionally on these marketers of high-end perfumes, trendy clothing or sleek fashion accessories. A study by Bain released in October found signs of a slowdown already in the personal luxury goods sector that includes shoes, jewelry and fashion; it predicted that sales could drop by as much as 3% to 7% in 2009 if current trends continue. Gillespie flatly predicted that “2009 will be the worst year on record for the luxury sector.” The parent of her former employer, Gucci, just reported its worst third quarter since 2005 because of the slowdown.

Conspicuous consumption seems practically un-American in these troubled times, according to some observers. Renowned trend analyst Faith Popcorn recently said that “[i]f you go up Madison Avenue [in New York], past Fendi and Prada, those stores are empty. Women are shopping in their own closets. You feel shame in buying even if you can buy.”

But that glum tone wasn’t evident at the Wharton panel discussion. Several participants noted that their core customer base, the truly wealthy, may cut back some on their discretionary spending but will not eliminate luxury purchases altogether. According to Randy Kabat, executive vice president of marketing and advertising for Prada USA, roughly 50% of the firm’s sales come from just 5% of its customers, although she is worried about the potential loss of some so-called “aspirational” middle-class consumers — 16-year-old girls spending a small fortune on the “it” handbag — during a recession.

As a result of the hard times, the panelists suggested that consumers are likely to see some moves aimed at selling high-end products at a slightly lower cost. L’Oréal’s Farrell suggested that one obvious step would be to sell fragrances in smaller containers, as long as the actual product is not diluted. “You can still maintain your brand integrity, but you’re selling at a price point that’s more accessible for the consumer in today’s market.” A similar move, Farrell added, is to ensure that some version of your key products are more available in mid-market retailers like Target or even — in the case of skincare products — drugstores like CVS, because during a recession even upscale Americans are likely to do more shopping in such stores.

The key is not to make any move that will diminish the value of a brand with a well-established name for luxury. “Good management weathers good times and the difficult times, and fashion doesn’t change,” said Patrick Abouchalache, who analyzes the retail industry as a managing director at Roberts Mitani, a New York-based investment firm. “You have to stay the course.”

Panelists agreed that marketing and branding issues are very different for high-end luxury companies than for large mass-market consumer goods firms, which typically seek to identify sizable voids in the marketplace and then create new products in an effort to fill them. For luxury goods, they noted, the business plan places trust in the artistic vision of a designer — and hopes that will lure customers.

“With high end fashion, you’re buying into a lifestyle,” said Prada’s Kabat. “You’re buying into someone’s point of view, and that’s reflected in the products that are created.” Miuccia Prada, the Milan designer who began creating the current incarnation of the company in the 1970s, is content to leave the business side of marketing new products to others so that she can focus on European runway shows, Kabat pointed out. “She had the freedom to produce newness — and a new point of view in her fashion.”

No Billboard on Times Square

Because of the luxurious image they must portray, these marketers said they also need to guard their brands in ways that mass-market companies do not. Tom Ford’s Galpern notes that her company rejected an idea for a digital billboard in Times Square as insufficiently high-brow. Tom Ford sees its fragrances as competing with Chanel — and “would Chanel have a billboard in Times Square?”

That does not mean, however, that luxury firms do not want their products to reach a fairly broad audience. Indeed, Kabat had words of praise for a trend she described as “Targetization,” in which the coast-to-coast mass retailer Target offers something of a higher design aesthetic to customers who are slightly more upscale than those of rival chains. Still, she noted that the United States can develop its appreciation for good design much further. “In Europe, fashion and design [are the] fabric of the culture, but [they are] not a part of the fabric of our domestic culture.”

Indeed, luxury marketers believe that their success in establishing an aura of desirability is what will ultimately get them through the financial crisis. It may be counter-intuitive, but Abouchalache said that demand for a consumer product like Cheerios cereal is finite, in a way that the need for a luxury item is not. “When it’s a tough day and you’re on the way home and you have to buy that handbag … it’s just a different factor driving that purchase. A customer could always use another purse.”

But to boost the bottom line, fashion firms are likely to focus now on pampering their best and most loyal consumers, using computer technology to increasingly customize upscale products that will be designed or tailored especially to their needs. The success of individualized luxury goods — such as designer clothes or eyewear — is a development that could keep a customer repeatedly coming back for more, according to the panelists.

“Everybody wants to be a lifestyle — and they’re going to want to stay for 10 or 15 years with your product,” said Abouchalache. Among the designer trends in customization are monogrammed handbags, personalized options for a color or a fabric in accessories, or a wider array of fragrances that are “personalized.” According to Kabat, Prada — which started its success with a simple but well-designed nylon backpack — is focusing on a similar approach, one in which “customization makes the purchaser feel special and unique.”

“This is not a time to panic,” added Gillespie, referring to the difficult fiscal environment. “This is a time to define and redefine the brand.”

Ironically, while the panelists were not particularly enthusiastic about the short-term prospects for emerging overseas markets, their companies continue to position themselves for when the time is right. Tom Ford International, for example, has already awarded franchises for stores in Beijing, Hong Kong and Dubai as it weighs a much larger presence in Asia; the firm has also spoken of plans to market made-to-measure Middle Eastern men’s robes called dishdashas.

L’Oréal’s Farrell noted that a lot of demand in Europe is coming from Eastern Europeans and especially from Russia, which has been swimming in oil wealth because of the price spikes in crude in 2007 and 2008. But he worried that the bubble of financial growth in such markets could burst quickly, adding that “you really have to be careful.”

Still, regardless of where the global economy winds up, luxury marketers say their principle mission will remain the same: Selling a more glamorous way of life to aspiring consumers. “You’re buying into that dream,” Kabat said. “And you’re buying into that grand theme, which is our job.”

This May Surprise You

admin — Thu, 30 Oct 2008 17:23:20 +0000

Study: Magazines Beat TV In ROI

by Erik Sass, Tuesday, Oct 7, 2008 4:06 PM ET

A new study of magazine advertising ROI by Marketing Evolution found that magazines are the most cost-effective means of influencing consumer behavior at certain stages of the decision-making process, or “purchase funnel,” beating out TV and online media. Specifically, magazines dominate two crucial stages: brand familiarity and purchase intent.

The Marketing Evolution study is actually a continuing meta-study, based on a survey of 38 different studies commissioned by various clients in recent years.

The most recent edition adds 18 studies to the 20 originally surveyed for Marketing Evolution’s cross-media accountability study published in 2006. Both focused on big categories, including automotive, entertainment, electronics and pharmaceuticals.

Marketing Evolution used an ROI model based on “cost per impact” in three stages of the purchase funnel–brand awareness, brand familiarity and purchase intent. Impact was assessed quantitatively in each case, meaning that Marketing Evolution assigns numerical values to things like knowledge about a particular product, planning to look for it in the store, etc.

At each stage, ROI was defined by three interrelated measures: the average number of people influenced, the number influenced per $1,000 of advertising spending and the cost per individual impact, a per capita figure. The study used TV as an index of 100 because it gets the largest portion of ad dollars. In all three stages, TV dominated the first measure–total number reached–for reasons of scale. However, magazines proved more cost-effective in brand familiarity and purchase intent.

In the first stage–brand awareness–Marketing Evolution examined how consumers came to be aware of the existence of a particular brand. Here, magazines almost pulled even in terms of people reached per $1,000 of ad spending, with 91 versus 100 for TV. Magazines came in between TV and online for cost per impact in this stage. TV led with $0.98 per impact, with magazines following at $1.08 and online trailing at $1.97.

Moving on to brand familiarity, magazines were almost twice as effective as both TV and online in number reached per $1,000, indexing at 181 people reached versus 100 for TV and 101 for online. Put another way, the per capita cost to increase brand familiarity was about $1.40 for magazines versus $2.61 for TV and $2.58 for online.

Finally, magazines also dominated purchase intent, influencing 145 people versus 100 for TV and 68 for online. Expressed as a per capita expenditure, magazines cost about $1.23 per individual impact, versus $1.77 for TV and $2.61 for online.

Highest earners are cutting back on spending

admin — Mon, 20 Oct 2008 18:27:42 +0000

In the Current Economy, the Highest-Income Affluents Have Cut Their Spending the Most

In the latest luxury consumer survey conducted after the stock market implosion Unity Marketing found that the ultra-affluents are changing their luxury lifestyles

Stevens, PA October 17, 2008 — For luxury marketers that are counting on their most affluent consumers to see them through the current economic crisis, evidence is mounting that even the most wealthy shoppers can’t provide them protection.

A new Unity Marketing survey of luxury consumers fielded October 3-8, while the stock market was in free fall, found that ultra-affluents who represent the top 2 percent of U.S. households are changing their lifestyles and shopping behavior.

On a year-to-date basis the ultra-affluent consumers (incomes $250,000 and above) have cut their spending on luxuries by nearly 20 percent. By comparison, luxury consumers with incomes from $100,000 to $249,999 cut their spending by some 10 percent in the first three quarters of 2008 vs. the same period in 2007.

“The results of the most recent luxury tracking survey challenge the conventional wisdom that the most affluent are immune to economic ups-and-downs,” says Pam Danziger, president of Unity Marketing, a consumer insights firm that specializes in the luxury consumer mindset.

“This time the ultra-affluents are being hit in the source of their wealth: the value of their homes and their stock portfolios. In a sign of their pain, some 44 percent of ultra-affluents said that the value of their investments have decreased by 25 percent or more and 31 percent said the value of their homes have dropped by 25 percent or more. Nearly half said that their financial situation is worse now than it was three months ago.

“In a dramatic reversal of the ‘wealth effect,’ half of the ultra-affluents said they are spending less on luxury now as compared with twelve months ago and 55 percent expect to spend less on luxury in the next twelve months,” Danziger explains.

How ultra-affluents are saving money

Ultra-affluent shoppers are taking action to cut their expenditures. About half of the ultra-affluents surveyed said they are:

Shopping more strategically, such as preparing lists, researching purchases and comparison shopping.
Going shopping less frequently.
Reducing the number of times they dine out.
Cutting their spending on personal fashion purchases, such as shopping sales, visiting outlets, and opting for less premium brands.

Danziger concludes, “It is not all doom-and-gloom for luxury marketers. The latest research shows that the luxury consumers are still indulging in their favorite luxury brands. What is changing is that they are being more selective in the luxuries that they buy. For example, instead of splurging on a whole new outfit including a dress, handbag, shoes and piece of jewelry, the newly frugal ultra-affluent shopper will treat herself instead to just one item, be it the handbag, a new pair of shoes, or the dress — which ever one really grabs her fancy.

“This latest survey emphasizes how luxury brands need to stay connected with their customers and understand the dramatic changes in attitude and mindset that are taking hold among the ultra-affluents. By understanding their customers better than their competitors, luxury brands will be able to weather the current economic storm,” Danziger advises.

Article brought to you by: Unity Marketing
Author: Pam Danzinger

Using Video to Elevate Luxury Marketing Online

admin — Tue, 14 Oct 2008 17:03:56 +0000

It takes a lot to make a brand site interesting these days, especially when you’re playing in the ultracompetitive luxury goods space. Securing an online audience is even more of a challenge when your brand doesn’t actually sell those products on your site.

Many luxury brands have struggled with how to represent themselves on their sites, in particular how much or how little to offer consumers. Some brands continue to maintain sites that are simply double-page magazine spreads in digital form that link to authorized online retailers. Others, like Tod’s, the Italian leather goods company, have chosen to use the Web to display not just their products but also the lifestyle they represent through innovative site features and technology.

Visiting the Tod’s brand site is like traveling to a foreign destination, where the culture is expressed through music, scenery, and especially fashion. All are represented on the site through a series of sections and features anchored by the image of the brand’s newest spokesperson, Gwyneth Paltrow.

Included on the site is “On the Spot,” a section devoted to the brand’s advertising. Site visitors can peruse its recent print advertising campaign and click on the Tod’s items featured therein. It’s a nod to the brand’s true comfort zone and that of most luxury brands: the print world offline, glossy and glamorous in all its painstakingly styled still-life glory.

It’s the reason you don’t see many luxury brands advertised in banner ads. Whether a valid concern or not, the notion is that banners generally can’t do the beauty of luxury goods justice. But Tod’s has found a way to translate the rich glamour that can be expressed in print to the Web. It has launched Tod’s TV, a site feature offering an original short film starring Paltrow and directed by Dennis Hopper.

The film channels the Italian neorealism genre to tell the story of Paltrow’s love affair with the brand’s Pashmy handbag. It has been the talk of many a fashion blog in recent months, as fans of the brand (and the star) analyze the work that actually debuted at the Cannes Film Festival earlier this year.

The film has also received some criticism, but as a marketing piece it certainly packs a punch. In less than five minutes, any consumer can come away with a clear understanding of the image Tod’s endeavors to portray, and the audience the flick is intended to address is sure to enjoy the over-the-top, self-indulgent whimsy.

The beauty of developing a video such as this — beyond its ability to present your brand in an environment dripping with style and fantasy — is the countless ways in which it can then be used to promote your products beyond your site. This is of particular importance for luxury-goods manufacturers whose priority is sustaining their brand cache, as opposed to generating immediate sales.

The best way to do this online is through visually engaging rich media work that highlights a brand’s products in the context of the environment and lifestyle they’re meant to complement. Short films like these are a popular choice among luxury manufacturers in the automotive space (recall this year’s Audi R8 Godfather Super Bowl spot, but few marketers extend their efforts to media buys, despite the fact that they could significantly expand their reach and the life of their videos by doing so.

How you go about doing it is a matter of determining your ad unit preferences and what sites appropriate for your campaign have to offer. Standalone video assets can be edited down and repurposed as pre-, mid-, or post-roll ad units, video banners, or sponsored video content media buys wherein Internet users watch an intro video ad in exchange for uninterrupted video content. In the case of Tod’s, a teaser version of the film would drive consumers to the site to view the full version. Other brands might also upload their video advertising assets to a microsite developed and hosted by one of their online retailers.

As a luxury brand bridging the gap between the familiar world of print and the Web, Tod’s has hit the mark with its site and video feature that go way beyond the once-traditional brochure-style brand destination. Even if your own video work doesn’t involve two megastars or debut at Cannes, it will be worth the investment, particularly if you can elevate it through a successful media campaign.

Author: Tessa Wegert, Oct 9, 2008
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