1 A Love Affair With Luxe - Cult of The Luxury Brand - Inside Asia's Love Affair With Luxury

15/02/2015
1ALoveAffairwithLuxeCultoftheLuxuryBrand:InsideAsiasLoveAffairwithLuxury
Cult of the Luxury Brand: Inside Asias Love Affair with Luxury
NEXT
PREV
Part One: How an
2 Finding Meaning
1
A LOVE AFFAIR WITH LUXE
Howcomeyoudonthavethemufflerwithchecks,theonethat
Recent
Topics
Highlights
Settings
Feedback
Sign Out
thePremierwears?ThepersonaskingthequestionisJiang
Zemin,untilrecentlyPresidentofChina,thePremierherefersto
isnoneotherthanthemancreditedwithreformingChinas
economy,thedynamicZhuRongji,andthecheckedpieceof
neckaccessoryinquestionistherathercontagiousBurberry
muffler,whichalsocountsthousandsofyoungJapanesewomen
Settings
10 days left in your trial. Subscribe.
Feedback
amongitswillingvictims.
ThesettingofthistruelifeshoppingdramaistheScitech
Sign Out
departmentstoreinBeijing,notexactlyahotspotforluxury
brandsinthefirstplace,andcertainlynotusedtohaving
presidentsdroppingbyunannounced.Jiangreportedlymakesit
tothethirdfloormenssectionunrecognized,beforepanic
ensuesandpeoplerealizethatitsthePresidenthimselfsans
securityentourage.Themanagingdirectorofthestorerushes
downtomeetJiang,whoisincreasinglyimpatienttoseethe
checkedmufflerhehasheardsomuchabout.Unfortunately,the
storedoesnotcarryBurberry.No,headsdontroll,butthenext
daythelocalBurberrymanagementissummonedfortalks.Pick
anyspotyoulike,thedepartmentstoreoffers,justputupa
Burberrystoreasfastaspossible.Avideoconferenceishurriedly
arrangedwithchiefexecutiveRosemaryBravoinLondon,who,
tickledbythestory,givesthegoahead.Anaccessoriescorneris
setupataprimelocationinthestore,andnowBurberrymufflers
arereadilyavailable,justincasePresidentJiangdoesoneofhis
spotchecksagain.
Frompresidentstoofficeladies,fromcaptainsofindustryto
universitystudents,fromwellheeledsocialitestohousewives
buyingfishinthelocalwetmarketsinJapan,eventhe
https://www.safaribooksonline.com/library/view/cultofthe/9781904838050/xhtml/ch01.html
1/29
15/02/2015
fishmongerstuckawaytheircashreceiptsinLouisVuittonbags
everysectionofsociety,everycountryinAsia,isfallingunder
thespellofWesternluxurybrands.Strolldownthebusystreets
ofTokyotoday,andabarrageofLouisVuittonhandbagscome
atyouonthearmsofmiddleclasswomen.Settledownfora
drinkatoneofShanghaishipnightclubs,andpickoutthe
Chanel,Dior,andPradabagsamongthedesignercladcrowd.
RidethesubwayinSeoulandmostwomenarehangingfirmly
ontotheirLouisVuittonsandGuccis.Dropoffyourchildatan
upscalekindergarteninHongKongandaquickglanceatthe
othermumsshouldbringyouuptodateonthisseasonsnew
arrivals.MeetingagovernmentofficialinBeijing?Chancesare
thesuitisZegna,andthatflashofgoldbeneaththesleeveisa
Cartierwatch.
Itshardtoimaginethatluxurybrandswereoncethepreserveof
theEuropeanaristocracy,thatamerehundredyearsagothese
beautifullycraftedpiecesofclothingandaccessoriesweresolely
forthepleasureandadornmentofawealthylite.Nowfamed
luxuryhouseslikeLouisVuitton,Herms,Chanel,Cartier,and
innumerableothersservetheconsumersofAsia,and,inastrange
turnofevents,itisthepopulousmarketsofthisregionthatare
centraltotheirsuccess.Asiahasgrownintotheworldslargest
marketforWesternluxurybrands,andbetweenthebrand
obsessedJapaneseontheonehandandChinaandIndiasrising
newmoneyontheother,thepresentandfutureofluxelie
squarelyinAsia.
HowdidtheluxurybrandculturespreadfromEuropesliteto
Asiashoipolloi?Fickleasfashionis,itsbusinesshistorycontains
enduringlessonsforallmarketers,explainingthestrategiesthat
changedsmallfamilybusinessesintohighlyprofitableglobal
empires.Importantly,itshedslightonsomethingeverymarketer
dreamsoftheseemingparadoxofcharginghighpricesbased
onexclusivitywhilesellingyourproducttoeveryTomoko,
Sadako,andYoshiko.Theluxurybrandindustryhasmanagedto
dojustthatinfact,thefineartofhavingyourcakewhileeating
ittooisitscorebusinessphilosophytoday.
THE GENESIS
TheforcesthatcreatedAsiascultoftheluxurybrandweresetin
motionaround100yearsago.
Intheearly1900s,whiletheBelleEpoqueunfoldedinEurope
1
aheadyperiodofprogressandprosperity,whenwealth
wasshamelesslyflauntedandelaboratewomensdresseswerea
primemethodofshowingfamilystatusatrickleofimported
luxuryproductshadalreadybeguntoflowintoAsia,although
theytouchedonlyasmallwealthylite.Japanhademergedfrom
itslongEdoperiodisolation,andhadbeguntradingwithBritain
andEurope,includingjewelryandotherluxurygoods.Afine
2/29
15/02/2015
crystalvasebyBaccaratwassaidtocostmorethantheaverage
Japanesehomeofthetime.BurberrysetupshopinTokyointhe
1920sthroughalocalimportingcompany.
InChina,ShanghaiwaslivingitsownversionoftheBelle
EpoqueastheParisoftheEastinthegiddy,hedonistic1920sand
1930s.Whilehighsocietywomenstucktothegraceful
cheongsamforpublicoccasions,menworefineFrenchsuits,and
SwisswatchessuchasthosemadebyOmegawhichentered
Chinain1895wereprizeditems.
RoyalfamiliesinIndiahadanaturalaffinityforEuropeanluxury
brands,shoppingontripstoLondonandParis,orsimply
commissioningpiecesfromthelikesofVuittonandCartier.The
famedPatialanecklacewasmadebyJacquesCartierforthe
MaharajaofPatialain1928itsashowstopperwith2,930
diamondstotaling1,000carats,includingthe234caratDeBeers
diamond,theseventhlargestintheworld.
ThencamethecrunchinonewayoranotherforalltheAsian
nations.TheSecondWorldWarknockedthebreathoutofJapan.
InnewlyindependentIndia,itbecamemorechictowearkhadi
ahandspuncottonclothsportedbyadherentsofthefreedom
movementthanluxuriesimportedfromWesterncountries.In
CommunistChina,youriskedyourneckifyoudeviatedfrom
clearlylaidoutstylecodes,andanyexpensiveitemsyourfamily
mighthavepossessedwereconfiscated.Independencestruggles
inSoutheastAsialedtotheAmericansleavingthePhilippinesin
1946,theDutchdepartingIndonesiain1949,andtheBritish
quittingMalaysiaandSingaporeinthelate1950s,
buta
combinationofpatriotismandpovertymeanttherewasverylittle
placeforimportedluxe.InmanyAsiancountriesprotectionist
policieslimitedtrade,andtheimportofluxuryitemswas
punishedwithheftytaxes,iftheywereallowedinatall.Harsh
postliberationeconomicrealitiesmeantthatpeopletoiledto
rebuildtheircountryandthemselvesmakingendsmeetand
savingfortheirchildrensfuturewerethepriorities.Forall
practicalpurposes,importedluxurybrandswentintohibernation
inAsiaforseveraldecades,onlyslowlyreappearinginthe1970s.
AcenturyofworldfashionasseenthroughtheChinese
cheongsam
Evenacenturyago,Asiawastakingitsfashioncuesfromthe
West.HerewetracetheimpactofEuropeandesignersand
Hollywooddivasonthecheongsamthegraceful,body
skimmingChinesedresswithsideslitsthatevolvedintandem
withinternationalfashiontrends.Shanghai,Chinasstylecapital
inthefirsthalfofthetwentiethcentury,dictatedthelook,passing
themantleontoHongKongaftertheCommuniststookover.
1920sThecheongsamwasslimmer,thesilhouettewasslinkier,
copyingthebiascutsofChanelthesleevesgotshorter,theslit
3/29
15/02/2015
higher.Hairwasstraightandbobbed,skinwaspaleandlips,
red.ThinkGaronne.
1930sThecheongsamwasanklelength,thefeelwaslighter,
sleeveswerecuttorevealtheunderarm.Hairwaspermed,
eyebrowsdrawnthinandarchedlikeGretaGarbos.
1940sThecheongsamwaswornwithjacketswithpadded
shouldersandplatformshoeslikeJoanCrawfords.
1950sThebodywasmorestructured,aChinesehourglass,
laChristianDiorsNewLook.Hairwasbrushedintosleek
rolls,strongeyebrows,smolderingeyeslikeAvaGardners.
1960sThecheongsamwasshorterandmoreboxy,patterns
andprintsweremuchbolder.Hairwasteasedupbirdsnest
style.ThinkYvesSaintLaurentorPierreCardin.
1970sThecheongsamwaspairedasatunicwithbell
bottoms.Psychedelicprintsreflectedtheswingingseventies.
1980sApowercheongsamwithamorepaddedshoulder.
VeryGiorgioArmani.
TodayThecheongsamdisappearsfromdailylife,onlytobe
reincarnatedasfashionableeveningwearbyChinesedesign
housessuchasShanghaiTang.
AdaptedfromHongKongbornfashiondesignerVivienneTams
bookChinaChic(NewYork:ReganBooks,2000,pp27074).
Enjoy Safari? Subscribe Today
4/29
15/02/2015
PhotoscourtesyofValeryGarrett,KareemJalal,Elizabeth
Chung,andShanghaiTang.
Inthemeantime,therewasplentyofactiononthecouturefront
inEuropeinthefirsthalfofthecentury,creatingmanyofthe
fashionhousesthatAsialovestoday.Theelaboratedressesthat
hadwomentrussedupincorsetsgavewaytomorecomfortable
clothingthanksasmuchtotheworldwarswhichforcedwomen
toworkinpracticaloutfitsastotheimaginationofdesigners
likeCocoChanel,whopromotedtheGaronnelook.Afterthe
SecondWorldWarChristianDiorbroughtbackthestarsin
womenseyeswithhisextravagantNewLook,waistsnippedinto
createanhourglassfigure.Itwasatimeofdramaticupheavalsin
Europewar,occupation,liberation,economicscarcitybut
despiteupsanddowns,Parisretaineditssenseofstyleand
remainedtheworldsfashioncapital,thankstodesignerslike
JeanneLanvinandPierreBalmain,whoincidentallycountedthe
QueenofThailandamonghisloyalcustomers.
TheUS,wheretheuppercrusthadreliedonParisforimported
couture,slowlystartedcomingintoitsownwiththeemergenceof
5/29
15/02/2015
localdesignerslikeClaireMcCardellandHattieCarnegie.Paris
wasstillthemothershipMcCardellstudiedfashionthere,
CarnegieretailedFrenchlabelsbutbothweredesigningfor
Americansensibilities.WallisSimpsonchoseAmericanborn
designerMainbocher,thenbasedinParis,todesignherwedding
dress.(Incidentallyherhusband,theexkingofEngland,hadhis
trouserstailoredinNewYork,preferringthemoreadvanced
AmericanstylebeltsandzipstobracesandbuttonsSavileRow
atthattimeconsideredbeltsandzippedfliestobevulgar.
USdesignerscontinuedtoriseinthe1970sCalvinKleinand
RalphLaurenamongthemdefiningamoreleisureoriented
casualeleganceastheAmericanstyle.Theyaddedacompletely
newdimensiontothefashionequationsavvymarketing.The
likesofBrookeShieldsadvertisingNothingcomesbetweenme
andmyCalvinsandtheuproarthataccompanieditshowedthe
Europeansthepowerofbrandingunleashedthroughthemass
media.Itwasaturningpointinthehistoryoffashion:Suddenly
itwasntjustthedesignorproductthatwascritical,itwasthe
imageandlifestylethatthebrandprojected.RalphLauren
createdanempirethroughmarketingalifestyleBritishlanded
gentryreinterpretedformodernAmericastartingwithPolo
menswearandextendingtowomen,children,home,formals,
casuals,andjustabouteverythingelse.Theeraofmassmarketing
ofluxuryhadbegun,aforcethatwouldbeadoptedrelentlessly
bytheFrenchinthe1990sastheysetabouttargetingawider
consumerbase.
TheperiodaftertheSecondWorldWaralsosawItalyemergeas
aserioussupplieroffineclothingandaccessoriesforEuropean
readytowearlabelsabitlikeChinaspositiontodayandit
wasonlyamatteroftimebeforethenationemergedasamajor
stylesetter.Theingredientswerealwaysthere:atraditionoffine
craftsmanshipwithleatherproductsandtailoredmenssuits,an
abundanceofexcellentqualitymaterials,modernproduction
technology,and,mostimportantly,apassionforladolcevita.If
FrancewasaboutluxuriouscoutureandAmericawasabout
casualelegance,Italiandesigncombinedbothitgavethefeelof
pureluxuryinreadytowearclothes.ThinkArmanisuit,
exquisitefabric,stylishlycut,immaculatelyexecuted,engineered
forcomfort,theworkofamasterdesigneratapricethatwasnt
totallyoutofreachapowerfulpackageinfurtheringthespread
ofluxe.
Atthesametime,theItaliansshowedthattheyhadwhatittookto
docoutureValentinowasamongtheearlydesigners,his
sumptuouscreationsfindingfavorwithglamorouswomenofthe
time,includingJackieKennedywhochoseaValentinodressfor
herweddingtoAristotleOnassis.WhiletheAmericanswere
mastermarketers,theItaliansexcelledatcreatingtherightkindof
buzz,anotherpowerfultoolinspreadingtheluxeculture.Itcame
naturallytothem,withflamboyantfigureslikeGianniVersace
6/29
15/02/2015
creatingasmuchnewsashisclienteleofprincesses,stars,and
highsocietywomen.ItalyroserapidlyandtodayMilanisas
muchafashioncenterasParis.
ASIAS TORRID AFFAIR WITH LUXE

BackinAsia,itwastimeforJapantoriseanditdidsoontwo
fronts.Itproducedadaringbunchofdesignerswhosprangonto
theinternationalsceneinthe1970sandearly1980sKenzo
Takada,KansaiYamamoto,IsseyMiyake,YohjiYamamoto,and
ReiKawakubo.Thelasttwoinparticularhadthefashionworld
gaspingwithshockanddelight,theircreationsoftatteredragsa
completedeparturefromanythingParishadseenbefore.Onthe
secondfront,Japanproducedanenthusiasticconsumerbasethat
hasgrowntobethebackboneofthegloballuxuryindustry.
Japanseconomicriseinthe1970sandtheheadyyearsofthe
1980sbroughthugebuyingpowertoitspeople,andtheytookto
Europeanluxurylikeafishtowater.Luxebecamethenational
obsessionbythe1990severythirdwomaninJapanowneda
pieceofit.Withluxurygoodsbeingpurchasedonsuchascale,
soonthetopbrandswerecountingtheJapaneseastheirsingle
largestconsumersegment.
Japanesetouristshoppersfirstbecameanoticeablephenomenon
inthe1970sandtheirnumbersballoonedtogiganticproportions
inthe1980sand1990s.Europesluxuryhousessatupandtook
notice,andstartedsettingupshopinJapanGucciopenedits
firststoreinTokyoin1972inresponsetounprecedented
demandfromJapanesetouristsinEuropedittoforLouisVuitton,
whichenteredJapanin1978.SoontheJapanesewerenotonly
turninginhugesalesathome,butalsoshoppingsomaniacallyin
Europethattheywerealmostsinglehandedlysupportingsalesof
luxurygoods.(JPMorganestimatesthattouristsrepresentmore
than80percentofLouisVuittonsChampsElysesstoresales.
5
)ThewiderJapanesetouriststraveled,themorebrandstores
wereopenedatalltheirfavoritedestinationsevenremoteislands
likeGuamhadwellstockedlardersofluxe.Theyjumpstarted
luxuryretailalloverAsiaHongKongsalesskyrocketedinthe
1980sthankstothem,dutyfreesalesinSeoulandTaiwantook
offwiththeirblessing,andevenjustemergingmarketslike
BangkokreportedheartysalestotheJapanese.Storestheworld
overgeareduptocatertothem,pricetagsandlabelswere
renderedinJapanese,andsalesstaffweretrainedtospeaktheir
language.(OneofourmoreendearingsightswasonRomes
luxurystorestuddedViaCondotti,witnessingasvelteItalian
salesgirlservingademureJapanesewoman,thewholetransaction
conductedinfluentJapanesewithplentyofbowingonboth
sides.
Thedevelopmentofeverysuccessiveluxurybrandmarketin
Asiahasfollowedasimilarpatternofgrowingeconomic
prosperityandthegovernmentswillingnesstobekinderon
7/29
15/02/2015
policiestowardsuchgoods.AfterJapancameHongKong,which
experienceditsownheadyriseinthe1980sand1990s,with
muchmoneybeingmadebyenterprisinglocalsonthestock
marketandpropertyspeculation.Sureenough,alongwithmoney
camearobustappetiteforluxe.Today,HongKonghas
developedintoaluxuryshoppingMecca,offeringthebest
selectioninAsia(outsideofJapan),atthebestpricesinAsia,
attractingalargenumberoftouristshoppers.Majorbrandshave
sixorsevenlargestoresinthecity,farmorethantheyhavein
Paris,London,orNewYork.
Armanihasitsglobalflagshipin
HongKong,afeastofeightoutletsspreadover34,000square
feetonthreefloorsofChaterHouseinCentral:GiorgioArmani,
EmporioArmani,GiorgioArmaniCosmetics,ArmaniCasa,
ArmaniFiori,ArmaniLibri,ArmaniDolci,andahugeArmani
Barinconcept,scale,andstyle,thiscollectionofstoresis
cuttingedgeretail.
SouthKoreaandTaiwansluxurymarketsbegangrowinginthe
1990saftertheirgovernmentsdroppedimportdutiesand
loosenedcontrols.SouthKoreaboastsitsownRodeoStreet,with
swankflagshipsandextremelywellstockeddepartmentstores.
Moreimportantly,theSouthKoreanconsumershavegonelabel
crazyasmanyas50percentofSeoulwomenreportedlyowna
LouisVuittonbag,althoughnooneknowsforsurehowmanyof
thosearefake.ForgetkeepingupwiththeJoneses,hereitisall
aboutoutdoingtheKimsandChungs.ThestoryinTaiwan
followsidenticallines.
ThatbringsustoChina.Everyonewaitswithbatedbreathand
toweringexpectationsasChinatakesitsfirstwobblystepsin
ManoloBlahniks,teeteringheadlongintotheworldofbranded
luxury.TheChinesepeoplehavetakenDengXiaopings
exhortationTogetrichisglorioustoheart,andindeedmany
aregettingseriouslywealthy.Whatpuzzlesmanypeople,
however,ishowacountrywithpercapitaGDPoflessthan
US$2,000canbeasignificantluxurybrandmarket.Theanswer
liesinunevendevelopment:Selectedcitiesandregionsare
emergingaspocketsofwealth,andtheoneswithmoneyareina
hurrytospendit.Itsasifadamhasburstand,withnochecksin
place,Chinasgrowingranksofnouveauxrichesaregorging
themselvesonnewfoundgoodies.Conspicuousconsumptionis
thenameofthegameintodaysChinaandeverymajorluxury
brandisalreadytheretoplayalong.
ReminiscentoftheJapaneseinthe1980s,theChinesetourist
shopperismakingheadsturnandjawsdropinthe2000s.The
mainlandtouristhasrapidlybecomethemainstayofHong
Kongsluxuryretailsector,somestoresreportingasmuchas70
percentoftheirsalestothissegment.Withvisarestrictionsbeing
relaxedandmanyWesterncountriesgivinggrouptouristvisas,
thenumberofChinesetouriststoEurope,theUS,Australia,and
indeedtherestofAsiaisrisingsteadily.Thisnewclassoftourist
8/29
15/02/2015
isacquiringareputationforspendinggenerously,routinely
pickingupluxurybrandsasgiftsforfriendsandfamilyback
home.Membersofasmalllitesegmenthavestartedflyingto
ParisandMilantorefreshtheirwardrobeseveryseason.
Andnowtheslumberinggiant,India,isfinallyawakeningits
economysizzlingatamorethan7percentgrowthrateandis
showingallthesignsoffallingunderthespellofluxurybrands.
Indiaalwayshadathinuppercrustofoldmoneythatdiscreetly
shoppedinLondonandNewYorkforluxuryessentials.Now
clankingnewmoneyisjoiningthespendingspree.Theseare
earlydays,withonlyahandfulofluxurybrandsdropping
anchor,andadmittedlytheresalotofspadeworktobedonein
termsofdevelopingaretailinfrastructureandbuildingbrand
awareness.Buttheseareexcitingtimeswhenfundamentalsocial
changesaresweepingaonceconservativecountry.Thespurtin
ITandoutsourcingbusinessesisputtingsubstantialmoneyin
younghands.Themediaexplosionisbringinginglobalvalues.
SplurgingoncreditisreplacingGandhianfrugality.Bollywood,
whichhasastrangleholdonthenationscollectivepsyche,is
depictingextremelyliberalfashionsinitsfilms.Midnights
childrenaregivingwaytoliberalizationsoffspringfertile
groundindeedforluxurybrandstotakerootandprosper.
DEMOCRATIZATION OF LUXURY IN THE 1990S

WhatcausedtheexplosionofluxurybrandsinAsia?Afortuitous
alignmentofthestars,youmightcallit.Inthe1990sthe
Europeanluxuryindustrywasgoingthroughamajorchange,
sheddingitstraditionalfamilybusinessmindsetandreinventing
itselfasalean,meancorporatemachinewithglobalretailing
ambitions.Forseniormanagement,changinghemlinesbecamea
lesserprioritythangrowingtoplinesandfatteningbottomlines.
Spunkynewcreativebloodwasinstalledtoenergizeagingluxury
houses,andmoreaffordablereadytowearandaccessorieswere
usedtowooyoungerandmoremainstreamconsumers.
Democratizationwasthebuzzword,throwingthedoorsof
exclusivityopentoordinarypeople.Atthesametimethe
economiesofAsiawereboomingandafreshlyprosperous
generationwasraringtoacquirethenewfangledsymbolsof
wealth.Thefrugallivingethicoftheirhardworkingparents
slowlyevaporatedmoneymadeeasilywasspentjustaseasily,
andthecultofluxurywentfrommildinfatuationtomanic
obsessioninthespaceofafewquickyears.
Hautecouturefinallyranoutofcommercialsteaminthe1970s,
withthenumberofclientssaidtohavedwindledto3,000,
not
enoughtokeepanindustrygoing.Theroleofhautecouture
shiftedfrommaincoursetoappetizerbigrunwayshowsusedto
spinoutmarketingpropaganda,onthebackofwhichranthereal
moneymakingbusinessofreadytowearandaccessories,a
practicethatcontinuestoday.Thenewclientswereyoungerand
9/29
15/02/2015
theyneitherhadthebigbucksneededforserioushautecouture,
norwasittheirstyletobetieddownbyelaborateoutfitsinthe
freespirited1970s.Readytowearandaccessorieswerealsothe
idealvehicleforexpandingintonewmarkets,whichbecamea
necessityasluxuryhousessearchedforfreshavenuesforgrowth.
DesignerslikeYvesSaintLaurentopenedboutiquesworldwide.
Licensingbecameacommonmethodforenteringnewmarkets,
anditsmasterpractitioner,PierreCardin,builtanempirelending
hisnametoagrowingandattimesbizarrelistofproducts,
includingchocolatebarsandfryingpanstodayPierreCardinhas
900licenseholdersin140countries,27inChinaalone.
FranchisingwasalsoapopulardistributionmethodforEuropean
brandstoextendtheirreach.
However,manylicenseestookagreatdealoflicensewiththe
brandsundertheircare,theproductoftenbeingcheapand
damagingtothebrandname,completelydisastrousintheluxury
context.ManyAsianfranchisees,ontheotherhand,mayhave
stucktothebriefintermsofhowthebrandoperationwasrun,
buttheyhadatendencytomilkitdry,alwaysreluctanttoinvest
inthemarketingexpendituresonecessarytobuildandsustaina
name.Asaconsequence,manybrandsunderperformed.Luxury
companiesawoketotheneedforcontrolandsteppedintothe
retailingarenathemselves.Theyboughtbacklicensesenmasse
10
forexample,YSLhadboughtback152licensesby2001. They
centralizedproductionandintegratedvertically,backwardsand
forwardstheluxurycompaniessimplytookchargeofthe
wholeshowfromdesign,production,andmarketingtoretailing.
Costcontrolbecameamajorpriority.Profitswereinfashion
again,andrapidgrowthwasthenewmuse.Frombeingprivately
owned,manycompaniesalsonowansweredtothestockmarket,
amoredemandingmistressthananyfashionistatheyhadever
served.
Overthe1990s,luxurycompaniesadoptedaseriesofstrategies
tospreadtheirgospel.
First,thestrategyofdistributioncontrolevolvedintomoreand
moreelaboratefreestandingstores,themostdizzyingexamples
inTokyowherebrandcathedralshavesprungup,risingseveral
floors.Forexample,thePradaEpicenterinAoyama,Tokyoisa
futuristicsixstoryglassconfectionwithcaveliketubesthatserve
asanintimateretailsetting.Thequalityofexecutionatthesenew
storesisoutstandingalloverAsia,andinTokyosomeareso
beautifulyoufeeltheurgetokneelandworshipandofcourse,
walkoutblessedwithapieceofluxe.Theirroleinbringingthe
brandaliveandofferingtheconsumeranintimate3Dexperience
hasmadetheseflagshipsyetanothermarketingtoolintheluxury
arsenal.
Secondly,brandslikeChristianDiorreincarnatedthemselves,
virtuallyabandoningtheiroldavatarforayounger,sexierone,
10/29
15/02/2015
whichstruckhomewithAsiasrelativelyyoungerconsumers.In
mostAsianmarketsthebiggestspendersonluxurybrandsare
youngwomenbetweentheagesof20and30.Appealingtothese
youngwomenmeantrecalibratingabrandscoolquotient,that
slipperyintangiblethatdefineshowinthebrandisamongtheir
peergroup,howwelltheyrelatetoit,howrelevantitistotheir
lifestyle.Itentailedsheddingthebrandsstaidoldimagefora
youthfulone,orwideningitsappealbyaddingtrendierproducts
likeadenimhandbagtotheclassicrepertoire,asLouis
Vuittondid.
Thirdly,theluxuryindustryplayeditsmastermove,thelogo
ficationofthehandbag,plasteringinstantlyrecognizable
symbolsinacontinuouspatternalloverthebag.ForAsian
consumersthiswasagodsend:Itdidthejoboflettingpeople
knowyouwereofacertainclassandstandinginsociety.We
examinethestatusdefiningroleofluxurybrandsingreaterdepth
inthenextchapter,buthereweemphasizethatthelogofication
ofbagswasthesinglemostimportantfactorinspreadingthe
luxurybrandmaniainAsia.Luxurycompaniescottonedonto
thesimpletruththattheLVmonogramandtheGucciGswere
whatAsianconsumerswereafter,andsooneveryotherbrand
fromCoachtoDior,FenditoFerragamowasdoingitstakeon
themonogram.Itisalessonthatmarketersofotherconsumer
goodscanlearnlogolineshavegrownsofastthattheyaccount
11
forupto80percentofsalesforsomebrands. Asiawasinthe
bag,sotospeak.
Fourthly,luxurybrandsstretchedtheyslicedanddiceda
personslifeandofferedaproducttofiteveryaspectofit,inside
out,24/7,whereverheis,whateveractivitysheisengagedin.A
brandmighthavestartedlifeincouture,itsstrengthmightliein
handcraftedleathergoods,oritmighthavebuiltareputationfor
finejewelrybutnowitisextendingitsequityoveraspectrum
ofproducts.Everybrandseemstobefirmlyheadeddownthe
pathofprovidingafullsuiteofproductsandthatsuiteitselfgets
redefinedandenlargedeachday.Goingforaholidayonthe
beach?TryaPradabikiniandD&Gflipflops.Skiing?Chanel
hasarangeofglamourskiwear.Riding?Howaboutasaddle
fromHerms?Goingtotheoffice?MaywesuggestaDunhill
briefcasedesignedtocradlealaptop?Wantthetime?Checkout
LouisVuittonslatestlineofwatches.Somethingforbaby?
Hermshasarangefornewborns.Adiaperbagformommy?
BabyDiorhasthelook.AniPodcase?TryGucci.Loungingat
home?Versacesofa.Goingtosleep?RalphLaurenbedsheets.
DecoratingtheChristmastree?ArmaniCasahasmodernbaubles.
Thisinvasionofdesignerbrandsintoeverydetailhastakenthe
culttoanotherlevel,andbyincreasingthecatchmentarea,luxing
upeveryaspectoflife,companiesarerakinginevenlarger
revenues.
Luxuryhasntjustbeendemocratized,itsbecomeinescapable.
11/29
15/02/2015
THE MALLING OF ASIA

HandinhandwiththeeconomicboomandurbanizationinAsia
cameanexplosioninretaildevelopment,therebyprovidingthe
necessaryinfrastructureforluxurybrandstores.Itstartedwith
departmentstorechainsinJapan,suchasMitsukoshi,Sogo,
Isetan,Seibu,andDaimaru.SoontheJapanesebecamesogoodat
settingupdepartmentstoresthattheyweredoingitinotherAsian
marketslikeHongKong,Taiwan,andSouthKorea.Elsewherein
Asiasmegacitiesshoppingmallsstartedspringingupinthe
1980s,atrendthatacceleratedinthe1990s.Theyoffereda
merrymixofretail,food,andentertainment,aonestopleisure
destinationthatpulledinthecrowds.IncitieslikeManilaand
Bangkok,mallsalsoplayedaverybasicroleinprovidinga
chilledatmosphereratherthanfryinginthehotsunoutside,
loungearoundinthecoolerclimesofanairconditionedmall,
evenifyouonlywindowshop.
ThemallingofAsiaandhereweusetheterminabroadsense
toincludethevarietyofretailcenterformatsthatdottheurban
landscapehasplayedmidwifetothebirthofthecult,making
availableupscaleretailspace,theambienceandatmospherics
consistentwiththehighendimagethatluxurybrandsneed.In
fact,inmanyupandcomingAsiancitiesthelackofsuitable
retailspacehassloweddownthemarchofluxury,forcingfriends
LouisVuitton,Gucci,Prada,etal.tospendthefirstfewyearsin
improvisedstoresinthelobbiesoffivestarhotelsuntiltheretail
infrastructurecatchesup.
Moreimportantly,themallingofAsiahasprovidedareallife
settingforconsumerstolearnaboutluxurybrandsandthe
lifestyletheydenote.ThisisthethemethatsociologistKen
Youngamplifieswhenhecallsshoppingmallsopenaccess
12
academiesofsocialdistinction. Aspeoplewanderthrougha
mall,lookingatshopwindows,tryingoutproducts,observing
othershoppers,theyaretakinginimportantlessonsin
consumptionbehavior.Whatismore,theyarelearningtoslot
brandsintostatushierarchies,pickingupcuesfromthestore
settingsandlocation.Oftenthecheapandcheerfulbrandsareon
thelowerfloors,andasyourisehighersodoesthecaliberofthe
brandand,needlesstosay,theprice.Howdoyouwantto
packageandpresentyourself?Overtime,andaprocessofhitand
miss,youlearntherightbrandsandproductstohelpyoucreate
theidentityyoudesire.
THE WORLDS BIGGEST MARKET TODAY: ASIA

TheAsianluxurygoodsmarketconstitutes37percentofthe
globalmarketofUS$80billion(Figure1.1).Theactualsizeof
AsianspendingishigherbecauseoftheAsianpenchantfor
shoppingabroad,ablyledbytheJapaneseandChinese,easily
addinganother1520percenttothecontinentsshare.By
conservativeestimates,itwouldbefairtosaythatAsians
12/29
15/02/2015
consumehalftheworldsluxurybrands(Figure1.2).
Figure1.1Asiaistheworlds#1luxurymarket:
Geographicbreakdown
Source:Authorsanalysis.
Figure1.2Majorbrandsearnmorethanhalftheirrevenue
fromAsianconsumers.
Source:JPMorgan,EuropeanLuxuryGoodsSector,2
November2005.
WithinAsia,Japandominateswithasumosized62percentshare.
HongKonghasalwaysbeenthesecondbiggestcurrentlya12
percentsharebutthatsapositionitwillsoonhavetocedeto
China,whichisgrowingbyleapsandbounds.SouthKoreaisthe
nextsubstantialmarketwithan8percentshare.Taiwanand
Singaporecontribute23percenteach.OtherSoutheastAsian
countriesThailand,thePhilippines,Indonesia,andMalaysia
arestillrelativelysmallluxemarkets,butthereisaselectgroupof
extremelywealthybusinessfamilies,mostlyofChineseorigin,
whoregularlyshopabroad,eitherinHongKong,Singapore,or
Europe.
Letslookatthingsfromabrandsperspective.Ifyoursisa
majorbrand,expecttogetathirdtohalfofyoursalesfromAsia
13/29
15/02/2015
(pluslotsmorefromAsiantouristsflockingtoyourstoresin
EuropeandtheUS).Ofcourse,theJapaneseconsumerwouldbe
yourdarling,aluxeglutton,gorgingheartilyathomeandthen
feastingabundantlyabroad.IfyouremovedtheJapanese
consumermomentarilyfromtheequationafeatthatcouldonly
beaccomplishedbydraggingherscreamingandshoutingina
mostunJapanesemannerthenyoursaleswouldsimplytakea
nosedive.Thatisthedegreeofluxebrandsdependenceon
Japan.
HowdeeplyentrenchedistheluxehabitinAsia?InJapan,an
estimated25percentoftheadultpopulationownsaluxury
product.ForotherAsiancountriesthepenetrationofluxeis
abouthalfofJapans.Asurveybymarketresearchfirm
Synovate,coveringHongKong,SouthKorea,andSingapore,
foundthatbetween12and15percentofAsianshadpurchaseda
13
luxurybrandinthelastsixmonths. Thesamesurveyvalidated
whatisabundantlyclearonthestreetsAsiasloveforthe
designerbag.InHongKong,awhopping64percentofluxe
shopperssurveyedhadboughtleathergoodsinthepastsix
months.
WhatareAsiasfavoritebrands?Asiansmakenobonesaboutthe
factthattheyareafterfamousbrandsthetermforluxury
brandsinseveralAsiancountriestranslatesintojustthat.So
whileAsiaisahighlycompetitivemarketwithover100
companiessluggingitout,consumersaremoreinterestedinthe
winners.Basedonsalesfiguresandbrandimageindicators,we
havecompiledAsiasTopTen(Table1.1).Itconfirmswhat
everyluxelovingAsianalreadyknows:Thereisnothingtobeat
thecharmsofLouisVuittonandRolex.
Wherewillfuturegrowthcomefrom?Theansweristhesameas
foreveryproductcategoryintheworld:ChinaandIndia,the
twinenginesofgrowthinthetwentyfirstcentury,Chinaoffering
themoreimmediateopportunity,Indiathelongertermplay.
BernardArnault,chairmanandCEO,LVMHGroup,remarkedin
thecompanysannualreportthatgeographicalgrowth
opportunitiesaremainlytobefoundinAsia,mostnotably
14
China,amarketthatisawakeningtoluxuryproducts. He
shouldknow:LouisVuittonhasseenitsbusinessgrowbycloseto
50percenteveryyearsinceitenteredChinain1992,anditwas
profitablefromyearone.Needlesstosay,ArnaultseesIndiaas
15
anotherpromisingterritoryforthefuture.
Table1.1LouisVuittonisAsias#1favorite
14/29
15/02/2015
GivenChinasgunghogrowthtrajectory,thequestioniswhen
itsluxurymarketwillsurpassJapans.Thegeneralexpectationis
around2014,aboutthesametimethatChinaseconomyis
expectedtoovertakeJapans,butitmaywellhappensoonerfor
severalqualitativereasons.ThedelicateJapanesecultureallows
foronlysubtledisplaysofwealth,butinChinaitisallabout
blatancyyouwinrespectandadmirationforachievingsuccess.
TheJapanesearediligentemployeeswhotoilhardinbig
corporationsforfixedsalariestheChineseareanationof
aggressiveentrepreneursintentonmakingitrich.Japanesemen
allowtheirwivestoshopfortheirclothesChinesemenhaveled
thefashionmovementinChina,andthemensmarketisbigger
thanthewomenseventoday.Japanesewomentendtobe
followers:Theyallrushintothesameshops,buyingupthesame
products.Ofcourse,fashionbydefinitionhastohaveapopular
following,butthefactthatChinesewomenaremotivatedbythe
needtostandoutasagainstmergeintoaLouisVuittoncarrying
crowdmeansthatthereismoreroomforavibrantfashionscene
toemerge.AndthentherestheChinesetrumpcard,the
Shanghainesewoman,bornwithinbuiltfashionantennaeanda
tankfulofsassandspunk.ShellmakesurethattheParisofthe
Eastregainsitsrightfulplace.
IsChinathenewJapanforluxurybrands?Onlyinsofarasit
presentsanuntappedpotentialformassivelongtermgrowth.For
themostpart,ChinaissimplythenewChina.Itoffersitsownset
ofopportunitiesandchallenges.Thereisplentyoflegworkstillto
doandrobustprofitabilityisdowntheline.IanHawksworth,
executivedirectorofHongKongLand,whichholdsthemost
prestigiousretailpropertyportfolioinHongKong,comments:
Itsnotaprofitablemarketdomesticallyinthenextthreetofive
yearsbecauseofthecostofdoingbusinesstherethe
15/29
15/02/2015
establishmentofnewstores,theestablishmentofdistribution
channels,thetaxationpositiononluxurygoods.AsWTObites,
themarginswillbecomeeasiertoachieveinChina.
16
THE RISE OF SHOWBUZZ

Twomajorforcesfueledthespreadofluxury:the
conglomerationoftheluxebusiness,andtheemergenceofanew
kindofmarketing,partshowbiz,partprofessionalbuzzwecall
itshowbuzzmarketing.
17
Conglomeration of Luxury
Inthegoodolddaysthedesignerwasthebrand.JeanneLanvin
startedthehouseofLanvin,GabrielleChanelwastheforce
behindtheHouseofChanel,ChristianDior,HubertdeGivenchy,
YvesSaintLaurenttheyallbroughttheirowntalent,
personality,andmystiquetobearincreatingacouturehousein
theirname.Theymayhavebeenapprenticedunderan
establishednamebeforeventuringoutontheirown,asYves
SaintLaurentwasunderDior,ortheymayhavetakenthe
helpinghandofasavvybusinesspartnertobankrollthem.Orit
mayhavebeenafamilyaffair:AldoGuccicarryingonwhatdad
Gucciohadstarted,orGeorgesVuittonbuildingonthefine
traditionofparentLouis.Thenameonthebusinesswasthename
ofthedesignertheirvisionledthefutureoftheirdesignhouse.
Theymayhavefloggedthename,asPierreCardinandYves
SaintLaurentdidusinglicensingarrangementstospreadtheir
wingstofarflungplaces,squeezingasmuchprofitaspossiblein
onelifetimebutatleastitwastheirownnametheysold.The
designerwasintegraltothebrand,andthebusinessmodelwas
simple:thedesigner,theirname,theirbusiness.
Allthatchangedwithoneman,BernardArnault.Sofarthe
Frenchhadexcelledatdesigningfashion,butthisFrenchman
tookagiantleapoutsidetheboxandsetaboutdesigningthe
businessoffashion.Arnaultdidntseethepointoflimitingthe
scopeofacompanybyrunningitlikeamomandpopstore,
albeitahighfashionone,whentherewasthepossibilityof
conqueringtheworldandrakinginhighersalesandhigher
profits.Andhedidntseethepointoffollowingrules.Inhis
visioneverythingwasinterchangeable,designerscouldbehired
andfired,brandscouldbeboughtandsold,management
changed,andcompaniesrestructured.Big,thatswhatArnault
wasafter,abigconglomerateofbrandswithbigrevenuesand
bigprofits.Likeagameofluxemonopoly,hesetaboutbuying
prestigiousbrandsandbuildingthemintolargerprofitgenerating
machines.Withonebrandyouhadonlysomuchreach,financial
muscle,andnegotiatingpowerwithastableofbrandsyoucalled
theshots.
Arnaultsetthetrend,andotherluxemonopolyplayersfollowed.
Thispursuitofgreatersizeandgreaterprofitshelpedtheluxury
16/29
15/02/2015
culturespreadlikewildfire.Theformulaofthe1990sconsisted
offindingnewbrands(eveniftheywereacenturyold)tobuy,
findingahotnewdesignertobreathelifeintothemandahot
newmanagementtomatch,findingnewproductstostampthose
brandson,findinglargenewconsumersegmentstobuythem,
andfindingnewmarketsallovertheworldtoselltheminall
thetimeexercisingcontroloncosts,controlonproduction,
controlondistribution,controlonbrandexpression.Control
freakswithexpansionisttendencies,youmightcalltheseluxury
conglomerates,justthesortofcompaniesthatstockmarketslove,
soofcoursegoingpublicbecamethemode,listingonbothsides
oftheAtlantic,bringingincashtofinancealltheexpansion
activity.
Theconglomerationoftheluxurybusinessbeganinearnestwhen
ArnaulttookoverChristianDiorinthemid1980s,buyingits
holdingcompany,abankrupttextilefirmcalledBoussac.He
followedthatwitharatheracrimonioustakeoverofLouisVuitton
MotHennessyin1989,andhesbeenshoppingaggressively
18
eversince. Theresult:anempireofover50brandswhich
19
broughtin13.9billioninrevenuesin2005 thatwillkeep
youcoveredinluxuryfromheadtotoeandinfinespiritstoo.
ArnaulthasfashionandleathergoodsbrandssuchasGivenchy,
Loewe,Celine,Kenzo,MarcJacobs,Fendi,DonnaKaran,and
more.Hehaspickedupanequallyimpressiveportfolioof
cosmeticandperfumebrands,ParfumsChristianDiorand
Guerlainamongthem.HehasboughtwatchbrandslikeTAG
Heuer,Ebel,Zenith,andChaumet,andhasnowextendedthe
LouisVuittonnameintowatches.Hesgottopqualitywinesand
spirits:Mot&Chandon,DomPerignon,andVeuveCliquot,
whichisapparentlythebeverageofchoiceatthefamedLouis
Vuittonstoreopeningparties.Hesalsointoretailingwith
designercosmeticsatSephoraandsellingluxurytotravelersat
DFS.Thejewelinthecrown,however,remainsLouisVuitton,its
monogrammedwaresspreadinglikeanunstoppableepidemic.
IfLouisVuittonisthebread,butter,andjamfortheworlds
biggestluxurygroup,theFrenchbrandCartierplaysthesame
roleforthesecondlargestgroup,SwitzerlandsRichemont,
startedbySouthAfricanbillionaireAntonRupertin1988and
laterrunbysonJohann.Richemontisanotherwellspread
conglomeratewithamajorinterestinwatchesandjewelry,which
20
accountsfortwothirdsofitsbusiness. Ithasadrawerfullof
topdrawerwatches:Piaget,Baume&Mercier,Vacheron
Constantin,IWC,JaegerLeCoultre,andLange&Shneamong
them.TheresVanCleef&Arpels.TheresMontBlanc.Theres
AlfredDunhill.Inotherwords,theresacollectionofbrandsthat
Asialoves,especiallyChina,wherepeoplebuyCartierwatches
bythedozenasgifts,aswellasenoughblazersandbriefcasesto
keepDunhillsretailnetworkof50pluspointsofsaleticking
away.Intermsofsales,theRichemontGrouphasaboutathirdof
LVMHs.
17/29
15/02/2015
ThethirdsignificantluxeconglomerateistheGucciGroup.Its
businesshistoryreadslikeaHollywoodthriller:Anearinsolvent
feudingfamilybusinessbecomesthemosttalkedabout
turnaround,thenthesubjectofafiercetakeoverbattlebytwoof
themostheadstrongFrenchmenintheluxurybusiness
LVMHsArnault,andFranoisPinault,whoheadstheFrench
retailconglomeratePPR(previouslyPinaultPrintempsRedoute)
thentransformsitselfintoamajorluxurygroupandgoes
shoppingforbrandsitself.Inthelate1980sGucciwasgasping
forbreathandDomenicodeSoleasCEOandTomFordas
creativedirectorwerebroughtintoresurrectit,whichtheydidso
successfullythateverybrandsincedreamsofdoingaGucci.
Fordssexydesignsandsavvyadvertisingcampaignsnotto
mentionhisownmoviestarlooksandirresistiblecharmhad
womendroolinginthenewlyrevampedchainofGucciboutiques
aroundtheworld.GuccishookAsia,itbecamethebrandtodie
for,andeventoday,althoughLouisVuittonoutstripsitinsales,
formanyAsiansGucciisthefirstbrandthatcomestomind,and
theonetheywouldlovetobuy.
Table1.2TheconglomeratesbehindsomeofAsias
favoritebrands
In1999ArnaultmountedatakeoverattemptonGucci,buthis
bidwasfoiledbyPinault,whopurchaseda42percentstake.It
wascorporatewarfare,glovesoff,withplentyoflawsuitsand
controversialpress.Theboardroomactionbecameasinteresting
astheshowonthecatwalks.Pinaultwontheday.Healso
subsequentlyboughtanothercompanythatArnaultwasafter,
SanofiBeaut,whichownsYSL.
GucciGrouphassinceacquiredSergioRossi,BottegaVeneta,
Boucheron,andBalenciaga,besidesluxurywatches,cosmetics,
18/29
15/02/2015
andperfumes.InyetanothertwisttotheGuccisaga,Fordandde
Solelefttheempiretheyhelpedcreatewhentheircontracts
expiredin2004reportedly,theycouldntseeeyetoeyewith
21
Pinaultontheirdegreeofautonomyinrunningthebusiness
tobereplacedbyRobertPolet,formerheadofUnileversice
creamunit.PinaultfinallyownsthewholeshowPPRbought
backminoritysharesandtheGucciGroupwasdelistedfrom
theAmsterdamandNewYorkstockexchanges.
Theforcesofconglomerationinfluencedsmallerluxuryhouses
aswell.Pradawentonashoppingspree,buyingJilSander,
HelmutLang,andChurch&Co.Hermsacquireda35percent
stakeinJeanPaulGaultier.
Partoftheconglomerationstrategyistoinfusefreshlifeinto
acquiredbrandstodoaGucci,sotospeak.TodoaGucciyou
needaTomFord,andwhilethereisjustoneofhim,theresafair
supplyofexcitingnewdesignerswithplentyofartistictalent.The
searchforgutsydesignerstogiveamoderntwisttoagingbrands
hasresultedinaninterestinggameofmusicalchairs.Ironically,
vintageFrenchandItalianbrandsarebeingentrustedtoyoung
AmericanandBritishdesigners.
Arnaultistheacknowledgedmasteratconductingtwentyfirst
centurysurgeryonnineteenthcenturybrands,findingtheright
balancebetweenlifegivinginnovationandthebrands
traditionalcore.AmericanMarcJacobsisthedesignerbehindthe
updatedimageofLouisVuitton,wittilyaddingatouchofpop
andkitsch.FellowAmericanMichaelKors,knownforhis
minimalistapproach,wasthemanArnaultchosetoreviveCeline.
ForChristianDior,ArnaultfirsthiredGianfrancoFerrein1989,
thenreplacedhimwithSpanish(butraisedintheUK)John
GallianofromhousebrandGivenchy.BritishdesignerAlexander
McQueenfilledGallianosspotatGivenchy,beforedefectingto
rivalGucciGroupandsettinguphisownlabel.Inthemeantime,
Gallianocontinuestoshockanddelightwithayoung,brash,
urbansexinessthatisthenewnewlook,milesawayfromthe
ladylikeglamorousNewLookthatChristianDiorcreatedin
1947.
AtRichemontsfashionhouseChlo,StellaMcCartney(daughter
ofexBeatlePaulMcCartney)succeededthelegendaryKarl
Lagerfeldin1997,makingwaveswithherfirstcollection,which
combinedvintagetoucheswithmoderntailoring.McCartneydid
aMcQueen,formingherownlabelundertheGucciGroup.Her
assistantandgoodfriendPhoebePhilo,alsofromBritain,took
overatChlo(untilshealsoleftin2006),withsuchsuccess
rumorsswirledthatPhilowasdoingthedesigningallalong.
ItsnotjustAmericandesignerswhoarelendingahandinthe
rejuvenationofEuropeanbrands:Americanmanagersare
pitchingintoo,bringingamuchneededprofessionaltouch.
RosemaryBravosturnaroundoftheveryBritishlabelBurberry
19/29
15/02/2015
isashiningexample.Shearrivedin1997and,withthehelpof
ItaliandesignerRobertoManichettiandanadvertisingcampaign
bymasterphotographerMarioTestino,teleportedBurberryinto
moderntimes,showingsupermodelKateMossinaskimpybikini
madeoftheancientBurberrytartan.MichaelBurke,another
American,hasbeenwithArnaultrightfromthestartofhis
LVMHempirebuildingforay(itshowsinBurkesfaultless
Frenchaccentandeffortlessshouldershrugging),playeda
significantroleinthegroupssuccessandtheturnaroundof
ChristianDior,andisapplyinghistouchtogroupbrandFendi.
The Emergence of Showbuzz Marketing

Withtheluxurybusinessitselfchangingmassivescale,global
coverage,professionalmanagementthemarketingand
promotionofthatbusinesstookonsimilarcharacteristics.
WhereasthelikesofCocoChanelandChristianDiorpresented
theircollectionsinasmallsalon,todaysfashionshowsare
nothingshortofshowbiz.Whereasearlierafewinfluential
magazineeditorsdictatedthedisseminationoffashion
information,nowhugemediaempireswithglobalcoverage
carpetbombtheplanetwithuptotheminutefashion
intelligence.Thecreationofbuzzgettingyourbrandtalked
about,makingsureitstaysinthenewshasgoneprofessional
too,deployingarangeofPRtechniquestomakeasplash,
includinghiredcelebritiesandoverthetopevents.Itsthenew
showbuzzmarketing,combiningtheprinciplesofshowbizand
belowthelinebuzzgeneration.
Theneedforthisnewkindofmarketingwasclear.Theearlier
conceptofluxurygoodsbasedonskilledcraftsmanship,
exclusivity,andlongevitybecameincreasinglyirrelevantwithina
machinemade,technologyenabledproductionprocess,with
batchesfarmedouttofactoriessometimescontinentsawayfrom
thehomeofthebrand.Today,itstheauraandimagethatyou
buildaroundthelogo,theintangiblecomehitherappealthatyou
embedinitsleather,orthecoolquotientthatyouimbueintothe
luxeconsumingpublicsmindthatswhatconsumersbuyas
muchastheybuythebag.Fromtheproductanditsinherent
quality,thefocushasshiftedtothebrandanditsimage.Grant
McCrackeninCultureandConsumptioncallsthistheprocessof
meaningmanufacture,wherethankstoadvertisingandthe
fashionsystem,culturallysignificantmeaningismovedinto
consumergoods.
22
Asfarasluxelandisconcernedshowbuzzmarketingboilsdown
tocreatingtherightkindofbuzz,packagingitneatly,andselling
itatthestore.Wellbeforetheconsumerreachesthatstore,theres
awholearmyofimagesandwordsassaultingher,createdbya
mediaandmarketingjuggernautworkingatfullblastonbehalf
ofthebrand.Bythetimeshetriesonadressfromthelatest
collection,orconsidersthepurchaseofanewbaginthestore
window,shealreadyhasdefiniteperceptionsaboutthebrandand
20/29
15/02/2015
theparticularpieceinquestion.AndifsheisJapanese,shecould
effortlesslywritea2,000wordpaperonit,fullofexquisite
detailsaboutthedesigner,thethemeofhislatestcollection,how
itlinksbacktohisearlierwork,themodelwhowalkeddownthe
catwalkwearingit,thebignamesintheaudience,the
internationalcelebritieswhoaresportingitcurrently,andthe
localonestoboot.Todaysluxeconsumerconsumesthebuzzas
muchasshedoestheproduct,andshespendstimediscussingit
withherpals.Latestbrandarrivalsarealegitimatetopicof
conversation,andwhatyouhaveonandwhatyouplanto
purchaseareinterestingfacilitatorsofsocialinteractioninAsia.
Themassmesmerizationwithfashiononaseasonbyseasonbasis
isadirectresultoftheindustrytakingoncharacteristicsof
showbiz.Thesamehumanfascinationwithglamourand
celebritiesthatdrawsadoringcrowdstoHollywoodmoviesand
alltheperipheralactionandgossipalsodrawsthemtothefashion
world.CatwalkshowsinParisandMilanhavebecome
extravagantproductionsstagedwiththeatricalexpertise.Theme,
venue,music,lights,sets,choreography,stylingeverythingis
managedtocreateabigbang,visualimpact.Itspure
entertainment,audaciousclothes,glamorousmodels,andplenty
ofleg,breast,andmoreondisplay.Andtheshowsarestagedas
muchfortheliveaudienceofAlistheadturnerssittingaround
thecatwalkastheyarefortheglobalpressthatbeamsthem
instantaneouslytotheworld.
Therearetelevisionchannelsdevotedtofashion,leavealone
numerouswebsites.Imagesfromtheshowsarecarriedbyfashion
andlifestyleglossies,internationaltitleslikeElle,Vogue,and
Cosmopolitan,aswellasaslewoflocalmagazinesthatdishout
fashionadvice.InChinaalone,some200newfashionand
lifestylemagazineshavesprungupinthelastfiveyears.Japanese
fashionglossieshavebecomesogoodthattheyaresoughtafter
inmarketslikeTaiwan,wherethecurrentgenerationcanteven
readJapanese.Butthatsthepoint:Thisvisualcultureis
universallyunderstood,itdoesnotneedtobetranslatedintoany
writtenlanguage.
21/29
15/02/2015
Fromthecosycalmoftheearlysalonshowingstothe
razzledazzleoftodaysrunwayacts,fashionshowshave
transformedintoshowbiz.Left,amodelposesinanearly
ChristianDiordressinarathersedatesettingbelow,a
modelstrutsdowntherampinadazzlerfromJohn
22/29
15/02/2015
GallianoscollectionforDior.
PhotoleftbyHenriCartierBresson,courtesyofMagnum.
PhotobelowcourtesyofDior.
WomeninAsiaareknowntotearoutpicturesfrommagazines,
shotsstraightfromtheramps,andwalkintostoresseekingthe
entirelook,headtotoe.Therichandfamousgoastepfurther
andtaketheleadfromthericherandmorefamousforexample
HalleBerrysElieSaabdesignedOscardress,asheersheathwith
strategicallyplacedflowers,wassportedbyHongKongsocialite
OliviaDavies,whohastoppedlocalbestdressedlists.Lesser
mortalshaveavirtualrelationshipwithdesigners,muchlikeafan
ofJenniferLopezwouldwiththesinger.Ifyouheartheintimacy
withwhichaJapanesewomantalksaboutMarcJacobs,youare
convincedthatheisindeeddesigningthoseexquisiteoutfitsand
accessoriesjustforher,oneonone.
Sowhatistheroleofadvertisinginthisshowbuzzmarketingera?
Itsaliveandwell,butitsrolehasevolved.Advertisingcreates
awareness,itdefinesthebrandsimage,buttodaysskeptical
consumerpaysmoreheedtowhatmagazineeditorialsaresaying.
ManyAsianconsumersdontevenbotherwiththeinherent
imageofabrand.Tryexplainingthefactthatthefavoritebrand
ofJapaneseteenagersisthedecidedlymaturewomansHerms
theyareonlyinterestedinhowinthebrandisamongtheir
peers.Forthatkindofinformation,itisfarmoreusefultocheck
outwhoiswearingwhatinthecompanyofwhomatwhich
eventbacktogoodoldbuzzconsumption.Thatswhere
advertisementscomeinextremelyhandyafterall,whicheditor
isgoingtotreatabigadvertiserunkindlyintheireditorial
content?Ifyoureaconglomerateyourstableofbrandsputsyou
inanenviablepositionbesidesexcellentadvertisingrates,you
arelikelytogetexcellenteditorialcoverage.
Brandpartiesaretheragethesedays,withthelocalwhoswho
inattendancethesecanrangefromcozylittleaffairsto
mammothextravaganzas,especiallyinChina.Theyensurethat
brandnamesfillthesocietypagesandgossipcolumnsinlocal
newspapersandmagazines.Inanecontroversiesarecreated.For
example,aHongKongactresswasaccusedofhijackingthe
Fendishowingofitsautumnwinterfurcollectionbyarrivingin
aLouisVuittondresswithanecklinethatdidntjustplunge,it
bungeed.Asaresult,theactressandherassetsgotmorepress
23
coveragethantheFendimodels. Celebritiesareincreasingly
beinghiredasbrandambassadors,withthespecificpurposeof
appearingateventswearingaparticularbrand,resultinginreams
ofnewscoverage.
Sometimesthebrandsdontevenhavetotrytobeinthenews.
TheluxuryculturehasnotonlyspreadtoAsia,ithasseepedinso
deepthatitwellsuponitsown,withoutanyeffortbythebrand
atall.Showbuzzonautopilot.Inthe2003SuddenAcute
RespiratorySyndrome(SARS)epidemicthatsweptthrough
23/29
15/02/2015
HongKong,residentsrushedtobuyvirusprotectivemasks.
RumorsspreadthatGucciandLouisVuittonhadputdesigner
masksonthemarket,theLouisVuittononeapparentlymadeof
supersoftleatherwithamonogrammedsterlingsilverclasp.This
ledtoadelugeofcallsatthecompanysstoresandoffices.It
turnedouttobeahoax,butmanywishedithadbeentrue.After
all,agirlneedsagoodlookingmasktogowithherGucciand
Chaneloutfits.
24
FASHION
1837LouisVuittonstartsmakingtrunksatthecourtofEmpress
EugenieandgoesontoopenhisfirststoreinParisin1854.A
centuryandahalflater,hisbrandconquerstheheartsofthe
Japaneseanditsbrownmonogrambagsbecomederigueurfor
Asiasnouveauxriches.
1837ThierryHermsstartsasaddlerycompany,whichis
modernizedacenturylaterbyhisgrandsonEmile.Itsfamed
Birkinbagsatjawdroppingpriceshavemadeitthemostdesired
statussymbolinAsia.
1895ThomasBurberrycreatesthetrenchcoat.Firstwornby
BritishofficersduringtheBoerWar,itisnowsowellentrenched
inAsiathatBurberryistheKoreanwordforraincoat.
1913CocoChanelopensherfirststoreinParis,andgoesonto
shakethecitywithherbreakingthemoldfashionstatements,as
wellasherunconventionallifestyle.Today,hersignaturestyle
hasfoundawidefollowinginAsia,fromJapaneseteenagersto
Koreanbarhostesses.
1915ThebeginningofBurberryslongandcheckeredhistoryin
Japan,includingBurberryfeverinthe1980sandaJapanonly
BlueLabel,immenselypopularwithyoungwomen.Gettingthere
earlycertainlyhelpedBurberryenjoysoneofthelargestretail
salesamongimportedluxurybrands.
1932GuccioGuccidesignstheclassicGucciloafers,asymbolfor
thewealthy.Ayearlaterhisson,Aldo,createstheinterlocking
doubleGlogo(afterhisfathersinitials),whichhalfacentury
laterbecomestheragealloverAsia.
1935SalvatoreFerragamosetsuphisworkshopinFlorence.He
wasdubbedshoemakertothestarsandhisshoesareamust
haveitemforeverySouthKoreanwomantoday.
1947ChristianDiorsNewLookcollectioncreatesastirinParis,
reshapingthefemaleformintoaneleganthourglass.Halfa
centurylater,JohnGallianosoutrageousdesignscauseasimilar
stiramongAsiasAlist.
1956HermsnamesGraceKellysmuchlovedbagafterheron
hermarriagetoPrinceRainierofMonaco.Waitinglistsforthis
24/29
15/02/2015
todieforbag,costingUS$510,000,areindefinitelyclosedin
Asia.
TIMELINE
25
1978MiucciaPradainheritshergrandfathersbusiness.Heruse
ofinnovativefabricsandherminimalistdesignsmakethe
triangularPradasymboloneofthehottestinAsia.
1983KarlLagerfeld,newdesigndirectoratChanel,reinventsthe
originalspiritofCocoinamodernmtier.Thisisthefirstof
whatsoonbecomesabrandrejuvenationtrendamongluxury
brands.
1986ImeldaMarcossfamed3,000strongshoecollectioncomes
tolightafterthePeoplePowermovementoverthrowstheMarcos
government.
25/29
15/02/2015
1990TomFordjoinsGucciascreativedirectorand,together
withDominicdeSole,revivesthecompanytoamazingheightsof
success.
1999BurberryssignaturechecksonabikiniwornbyKateMoss
transformthe100yearoldlabelintoamoderndaybrand.Asia
issoonawashinBurberrychecks,somewithalittlehelpfromthe
fertilecounterfeitmarket.
2001Hermss11storyglassbrickretailextravaganzaopensin
Ginza,Tokyo,creatinghysteriaamongwomenwhoqueueup
severaldaysinadvancetobuythelimitededitionbagspromised
onopeningday.TheRenzoPianodesignedflagshipstoresetsa
highnoteforthemegasizedflagshipstoretrendthatcatcheson
inJapan.
2001Plaza66,astateoftheartluxurymall,openson
ShanghaisfamedshoppingstreetNanjingLu,pushingthecitys
retailtoworldclasslevelsinonestroke.
2002Queuesbuildupthreedaysinadvancefortheopeningof
LouisVuittonssixfloorflagshipstoreinOmotesando,Tokyo,
anappropriateretailtemplefortheluxurybrandmostreveredby
theJapanese.
2006ThelikesofArmaniandChanelstagehautecoutureshows
inHongKong,signalingtheopeningupofalucrativeultrahigh
endsegmentinAsia.
2007Indiaentersanewphaseofluxuryretailingwiththelaunch
ofDLFEmporioinNewDelhi,thecountrysfirstluxurymall
withawhoswhorosteroftopbrands.
26/29
15/02/2015
Thelogoficationofbagsacceleratedthespreadofluxe
27/29
15/02/2015
maniaacrossthecontinent.
PhotoscourtesyofCoachandFendiAsiaPacific.
28/29
15/02/2015
Everheardofathreeyearwaitinglistwhichyoucanno
longergetontoforabag?!Theculprits:Birkinand
KellybagsbyHerms.
PhotoscourtesyofHerms.
PREV
Part One: How an
NEXT
2 Finding Meaning
People who finished this also enjoyed:

BOOK SECTION
Targeted male
from: Fashion Brands, 3rd Edition by Mark
Tungate
Released: October 2012
17 MINS
Business / Business Communication
Recommended / Queue / Recent / Topics / Settings / Blog(http://blog.safaribooksonline.com) / Support(http://msupport.safaribooksonline.com/?prod=flow) / Feedback / Sign Out
2015 Safari(http://www.safaribooksonline.com/).
Terms of Service / Privacy Policy
29/29

1 A Love Affair With Luxe - Cult of The Luxury Brand - Inside Asia's Love Affair With Luxury

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

1 A Love Affair With Luxe - Cult of The Luxury Brand - Inside Asia's Love Affair With Luxury

Uploaded by

Copyright:

Available Formats

15/02/2015

Part One: How an

Enjoy Safari? Subscribe Today

ASIAS TORRID AFFAIR WITH LUXE

DEMOCRATIZATION OF LUXURY IN THE 1990S

THE MALLING OF ASIA

THE WORLDS BIGGEST MARKET TODAY: ASIA

THE RISE OF SHOWBUZZ

The Emergence of Showbuzz Marketing

Part One: How an

People who finished this also enjoyed:

You might also like