Luxury Brands: Marketing the Upscale During a Downturn

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.”

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This May Surprise You

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.

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Highest earners are cutting back on spending

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.

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