CH1: Luxury and Fashion Marketing

 Defining Luxury:

• Luxury is the “extraordinary”, it stands out from the ordinary in terms of quality, design, and exclusivity.
• It consists of scarcity (limited availability) and beauty at a time.
• It is mainly adopted because of its intangible perceived value: Its value transcends mere functionality or utility
and is primarily derived from intangible qualities such as prestige, status, and emotional fulfillment.
• Consumers are willing to pay premium prices for luxury goods or experiences not only for their tangible features
but also for the symbolic meaning and social recognition associated with owning or experiencing them.

 Luxury characteristics:

• Physically manifests wealth and authenticity. luxury has tangible markers of wealth like premium material,
exquisite craftsmanship, attention to detail, and authenticity/customers expect genuine material
• Known for the emotional and intellectual impact of its “aura” over perceivers. It creates strong emotional and
intellectual responses: desire, aspiration, admiration, pleasure, pride, sense of belonging.
• Reflective of a distinguished social status. Luxury goods serve as symbols of social status and prestige, reflecting
the owner's elevated position within society.
• Caters to a niche segment within the broader consumer market.

 Defining Fashion:

• Deriving from the verb “to fashion”, denoting the act of shaping, forming to, or designing for, it typically implies
change and transformation.
• Fashion serves as a reflection of the beliefs, values, ideas, attitudes, and assumptions—of a particular community
at a given time.
• It is thus creative-based ( imagination, design, and craftsmanship) and necessitates three dimensions to happen:
time, space, and individuals. It evolves over time and responds to different tastes, technological advancements,
socio-economic factors, and varies across geographical regions and demographic groups.
• It goes way beyond its traditional materialistic aspect and can be manifested throughout arts, manners and
philosophies.

 Fashion Characteristics:

• It is an interminable evolving process rather than a bunch of independent events. Continuous and dynamic process
characterized by ongoing change and evolution.
• Intrinsically imitative in nature. trends and styles being inspired by existing ideas, Trends often propagate
through social imitation and emulation.
• Reflective of cultural and social identity.
• Fosters a sense of belongingness. By providing individuals with opportunities to express their identity, connect
with like-minded communities, and participate in shared cultural experiences.
• Broad range of people. It caters to a broad spectrum of tastes, preferences, and lifestyle choices. fashion offers
something for everyone.

 Similarities: both are subject to external perceptions and both may apply the anti-laws of marketing.

 Luxury and Fashion: A historical overview

  Historically, luxury drove fashion, with elites setting the trends that trickled down to the lower classes.
 However, modern cultural backlashes against elitism and exclusivity have opened the scope for fashion to
autonomously evolve.
 In certain contexts, fashion now drives luxury, with designers and street style influencers shaping trends that
luxury brands seek to emulate or co-opt. High-low collaborations between luxury brands and streetwear labels
have blurred the lines between high and low fashion, democratizing luxury and challenging traditional
hierarchies.
 The rise of the middle class has democratized luxury consumption, making high-end products more accessible to
a broader audience. As fashion trends become more democratized and inclusive, luxury brands may find
themselves influenced by the tastes and preferences of the middle class, leading to a situation where fashion
trends are driving luxury.

 The contemporary landscape:

 Whilst all contemporary luxurious products/services are fashionable. Not all fashion products/services are
necessarily luxurious!
 Luxury brands and products often incorporate elements of fashion to maintain relevance and appeal to modern
consumers.
 While fashion items may be fashionable and reflect current trends, they lack the exclusivity, craftsmanship,
quality, and prestige typically associated with luxury goods (mainstream fashion and fast fashion).

 Marketing Luxury and Fashion Brands

 Marketing is all about psychology! Successful marketing campaigns leverage insights from psychology to
understand consumer motivations, preferences, and decision-making processes.
 "Advertising is the art of convincing people to spend money they haven't got on things they don't need." – Will
Rogers. Advertising has the power to create desires and wants in consumers, even for products or services they
may not necessarily need.
 "Marketing is no longer about the stuff that you make, but about the stories you tell." - Seth Godin. Shift in
marketing philosophy towards storytelling and brand narrative.
 "The conscious mind may make the final decision, but the subconscious mind is whispering in its ear." -
David Berreby. While consumers may believe they are making rational, conscious choices, their decisions are
often influenced by subconscious biases, emotions, and social cues. Marketers employ various tactics, such as
visual imagery, color psychology, and social proof, to appeal to consumers' subconscious desires and motivations.

 Maslow’s hierarchy of needs:

 Physiological needs ( air, water, food, shelter, sleep, cloths, reproduction… )

 Safety needs ( security, employment, health, property )
 Love and belonging ( friendship, intimacy, family, sense of connection… )
  Esteem ( respect, self-esteem, status, recognition, strength, freedom..)
 Self-actualization ( desire to become the most that one can be )
 BRANDING in self-actualization is inevitable!
- Branding plays a crucial role in facilitating self-actualization by offering products, services, and
experiences that align with consumers' values, aspirations, and personal goals.
- By associating their products or services with self-actualization themes such as personal growth,
authenticity, and empowerment, brands can position themselves as enablers of individual fulfillment
and self-expression.

 The two golden formulas never to be forgotten when doing marketing:

Perceived Value = Benefits – Cost
 Benefits: functionality, quality, convenience, and emotional appeal.
 Costs: money, time, effort, or opportunity cost.
Satisfaction = Reality – Expectations
 Reality: actual performance or quality of the product or service as perceived by the customer.
 Expectations: preconceived beliefs or anticipations about the product or service, based on factors such as
marketing messages, brand reputation, and past experiences.

 Marketing Luxury and fashion brands is indeed about marketing, but it is also about:

 Buying expertise: Ability to select and procure products for retail or distribution channels that align with the
brand's image, target market, and pricing strategy.
 Merchandising skills: Effective merchandising goes beyond simply displaying products; it involves creating
immersive and aspirational retail environments that communicate the brand's values, lifestyle, and aesthetic
vision. Merchandising strategies may include visual storytelling, product placement, and experiential elements to
engage and captivate customers.
 Consultancy aptitudes: Ability to provide expert advice and guidance to luxury and fashion brands on various
aspects of their business, including marketing, branding, product development, and market expansion. leverage
their industry knowledge, market insights, and strategic thinking to help brands identify opportunities, overcome
challenges, and achieve their business objectives. This may involve conducting market research, analyzing
consumer behavior, and developing tailored strategies to optimize brand performance.
 Trends’ forecast competencies: the ability to anticipate and analyze emerging trends in fashion, consumer
behavior, and market dynamics to inform strategic decision-making and innovation ( staying ahead of trends).

 Marketing Luxury Brands: Critical variables to consider:

 The market size. Typically target niche markets characterized by a smaller customer base compared to mass-
market brands. Understanding the size and dynamics of the luxury market is essential for identifying opportunities
for growth and expansion.
 Customers’ profiles & expectations. Luxury customers are often affluent individuals who value exclusivity,
quality, and craftsmanship. It's crucial to understand their demographics, preferences, and lifestyle to tailor
marketing strategies effectively. Luxury customers have high expectations regarding product quality, service
excellence, and brand prestige. Meeting or exceeding these expectations is essential for building brand loyalty and
reputation.
  Customers’ relationship management. Building and nurturing relationships with luxury customers is paramount.
Personalized experiences, exceptional service, and exclusive events can help foster a sense of belonging and
loyalty among customers.
 The financial affordance of heavy, long-term investments. Marketing luxury brands often requires significant
financial investments in areas such as product development, brand building, and experiential marketing. Luxury
brands must carefully assess the ROI of their marketing initiatives and allocate resources strategically to ensure
long-term profitability and sustainability.

 Marketing fashion brands: Critical variables to consider:

 Market competition. The fashion industry is highly competitive, with numerous brands vying for market share
and consumer attention. Understanding the competitive landscape is crucial for positioning the brand effectively
and identifying opportunities for differentiation. Analyzing competitors' strengths, weaknesses, market
positioning, and marketing strategies can provide valuable insights for developing a unique value proposition and
setting the brand apart from competitors.
 Customers’ affordability. Fashion brands cater to a diverse range of consumers with varying levels of
affordability. It's essential to understand the target market's income levels, spending habits, and purchasing power
to develop pricing strategies that are both competitive and accessible.
 Fashion trends and forecasts. Monitoring industry trends, consumer insights, and cultural influences can inform
product development, marketing campaigns, and merchandising decisions. By aligning with current trends and
anticipating future shifts, fashion brands can stay ahead of the curve and maintain a competitive edge in the
market.