• Transform magazine
  • March 03, 2024

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Living, loving or losing luxury

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The luxury sector can be contradictory. It is at once focused on the future and the past, on digital and traditional communications, on exclusivity and awareness on sustainability and on sales. Yet, it’s ultimately the brand that matters. In a roundtable discussion co-hosted with Siegel+Gale, luxury brand professionals share their thoughts and experiences. Brittany Golob reports on luxury’s changing communications

Chanel CEO Maureen Chiquet said, “The risk of any great luxury brand that has its history in the past is that it can get dusty.” A strong brand requires more than just a burnished surface, but a strategy that will ensure little to no dust amasses in the future. That is the challenge facing modern luxury brands.

For those in the luxury space, balancing the exclusivity that is synonymous with luxury and the transparency afforded by modern technology requires a deft approach to communications. Transform magazine held a breakfast debate in London last month at which 10 brand and communications professionals from across the sector discussed their experiences, challenges and expectations.

Heritage, for established brands at least, is what luxury brands are desperate to both protect and exploit. Centuries of experience can be exploited to build brand awareness and trust. Yet, heritage can, as Chiquet alludes, become constricting. The demands of the modern consumer require all brands to adapt faster than ever before, forcing luxury, often for the first time, to deal with that pace of change.

One of the attendees, from a single malt scotch distillery says, “A brand evolves over time…But that brand cannot stay the same over 120 years. There’s a sense that this is the brand and we have to hold on to what we are and we can’t change it because we have heritage and richness and values. But, you need to be confident that there are things that are rock solid and things that I’m willing to flex or develop or enter into with the brand.” She points to specific icons within the brand language that should remain fixed – for they are the primary promoters of brand awareness.

That’s the easy part, a Louis Vuitton bag will likely feature the iconic monogram and a bottle of Johnnie Walker Blue will have a diagonal label on the bottle. These are things that tie back to the history of a brand and give it a sense of place. The founder of luxury golf company, RolleyGolf, says his startup could have benefitted from that sense of long-term visual strategy from the outset. After a quick rebrand, the company lost some of the equity apparent in the initial branding and is still working to rebuild awareness.

And yet, as the distillery communicator says, things have to change in some regard. This is most apparent when companies begin working in new markets. Fashion and taste for food and drink varies wildly worldwide so the height of luxury in London may be just a bit too traditional for a young, wealthy Emirati. Different customs also influence the ways in which people consume luxury. In Japan, whisky is ordered by the bottle and drunk alongside green tea. This may horrify master distillers in Scotland, but is perfectly normal for those partaking in the scotch.

“The brand has to be able to adapt to situations without losing its core brand values,” a breakfast attendee says. Liana Dinghile, group strategy director at global brand consultancy Siegel+Gale, with whom Transform co- hosted the breakfast, says brands should be “Identifying which signatures are core and identifying where in the world that adaptation needs to happen so that you create that connection and appeal and show the respected appreciation of the cultures you’re trying to work with.” It’s a possible evolution for even the most traditional of luxury brands, as long as some core elements – like a brand icon, taste, packaging or design element – remain consistent.

Luxury, however, also caters to bespoke creations and one-of-a-kind craftsmanship. Luxury car companies offer customers the ability to envision their dream automobile and mobile phone providers dream up the best of the best in handheld technology. For London-based chandler Rachel Vosper, bespoke work allows the brand to reach easily into new markets. Offering custom-made candles and scents to royalty – both literal and figurative – the world over is a sophisticated approach to localisation without compromising the brand.

Brand ambassadors can help, brand managers say. Local celebrities, respected figures or prominent faces in the target market can build awareness and develop trust between the brand and the consumer. A digital manager for a British designer says unofficial brand ambassadors also serve this purpose. Yet even in this arena, practices have begun to shift. Whereas ambassadors used to accept products as gifts, now many are expecting payment as well. “Marketing budgets are not infinite,” the digital manager says, as this makes it difficult to prove ROI on ambassadors.

The logical shift then, for most, has been into digital. Though the strategy is not always gold-standard nor the approach always innovative, the move to digital has been surprisingly embraced almost whole-heartedly by the luxury sector. Many find digital and social media a great way to exert control over their message, to reach global audiences and to localise content to make their offer relevant to all markets.

Building narrative through digital strategy by Anant Sharma, CEO, Matter of Form
Luxury brands, by their nature, are built around scarcity, exclusivity and low promotional activity. This doesn’t sit well with the bulk of marketing tactics, especially digital. Digital can, potentially, destroy the shroud of mystique luxury brands have worked so hard to create, leaving them naked and exposed – something that no brand wants.
Digital in luxury has to exist in a landscape where human service carries an increasing premium. High- end brands have had some success in their efforts to deploy digital first marketing campaigns, like Burberry’s Art of the Trench. But how many of these initiatives have been part of a holistic, coherent brand strategy, and how many have fallen flat as partially functioning gizmos and gimmicks? In order to realise the true potential of digital there is one core premise brands must embrace – the fact that the concept of ‘integrated’ campaigns no longer exists.
Attempting to create integrated brand communications in a digital world inevitably results in brands needing to compromise, and this is the first area in which most luxury brands fall flat. Instead of restricting themselves, brands must look to create wider strategies that are supported by a raft of sharp, tactical campaigns and structures that bare a deep sensitivity to the essence of the channel.
The days of print, television and outdoor are gone, and with it the traditional ‘single message’ that luxury brands in particular relied so heavily upon. Now, brands need to be aware of the nuances of each marketing channel and tailor their approach to maximise effectiveness while maintaining a consistency.
Agencies working with luxury brands have an obligation to help prepare them for a rapidly changing world. Every strategy and plan they propose should enable the brand to feel that they are arming them with the right tools to respond to the rapid rate of change needed, with confidence – something luxury brands are not naturally comfortable with.
Today’s luxury consumer isn’t just focused on individual interactions and particular channels; they care about the narrative behind the brand and its products. Building and communicating this narrative addresses the inherent trepidation of many luxury brands that creating an online experience will detract from the wow factor of their stores. It also explains why humanisation through colloquialism, curatorship and audience engagement is actually key to a brand’s success rather than the downfall many luxury brands believe it to be. With the rate of change only increasing, brands cannot afford to balk away from leveraging digital to become more human. Being more human drives a deeper level of connection, which in turn drives loyalty and revenue. As a sector, luxury brands have always been held up as inspiration when it comes to consumer engagement. If they are to continue to be seen as leaders, they need to capitalise on their momentum and embrace their human side.

But, if it’s going to be done, do it well. “It has to cross all channels. If it doesn’t, I always question, ‘Is it worth doing?’” the digital manager says. An omnichannel approach is one way to link the history of excellence in advertising and offline marketing in luxury to the new content coming out of the sector. For brands that can easily prove the authenticity of their product through expertise and knowledge, shown through video, imagery and other online content, this makes sense. Yet, the problem of exclusivity versus brand awareness rears its head again.

A communicator from a London-based men’s fashion house says, “If you’re talking about a luxury brand in the physical sense, it’s very exclusive. But in the digital sense, it’s very inclusive. So it’s a necessary consequence that if you put yourself out there, you can control your presentation but you can’t necessarily control an outcome. It’s how you choose to deal with a negative in that context, if you deal with it at all.”

It also requires a bit of creativity and trial and error. For brand that rely on sensory experience – hoteliers, perfumiers, food and drink – digital storytelling can be difficult. “There does have to be an element of the company going, ‘We’re not quite sure what this is, but let’s give it a go and learn something along the way,’” one attendee says. “Particularly for an old brand, getting the right tone of voice, saying things in a digital forum without sounding like a 100-year old brand is a difficult balance to get right.”

Yet in the fashion industry, sales drives ROI. This informs digital strategy and encourages these brands to get creative with their e-commerce efforts. An attendee representing a major British designer says wholesale partnerships help – if approached in the right way. Her products are featured on Net-a-Porter, Harrods and other major retailers’ websites, but they are linked by a newsworthy story or promotion to ensure take-up. “I’m competing against myself,” she says. “If there’s not a story to tell they’re not going to talk about it. Even though I’m competing against Net-a-Porter, Net-a- Porter is competing against Harrods, against Saks.”

It’s difficult, in that respect, to balance the need to achieve sales targets and the desire to build the brand. She says though, “It’s a very good thing for brands because I don’t have 6m unique visits and Net-a-Porter does.” E-commerce manager for premium British tailor Paul Costelloe Man, Mark Palfreeman, agrees, “The easiest way to achieve brand awareness is to maximise established channels alongside your own e-commerce activity. Your own web presence gives you greater control over your brand’s positioning. You control the look and feel and extol what you deem to be important USPs, but it relies heavily on generating organic traffic.”

He adds that the ability to achieve cut-through among the masses of competition on larger retailers’ sites is aided by promotions, storytelling and a justification of the brand’s values. “Working with established partners can harness the online presence of high street retailers. This is not quite as cost effective due to the related overheads, but benefits from established e-commerce practices. However, you are positioned directly next to competitors, though that variety is often what draws traffic to the site,” Palfreeman says.

Luxury has long been able to link its products to its brand values and story. It’s no surprise, then, that shifting that connection to the digital world has been a logical development in the sector. Yet some look to the future and see further change in store for luxury brands. Dinghile and colleague on the strategy team Samira Qassim, say “As with any brand, awareness is key to marketing strategy. The challenge for luxury brands is to be exclusive and inclusive. Iconic luxury brands face this paradox with their DNA, their unique luxury codes, to build experiences inviting outsiders in. Whether it be through media or public art exhibitions, the commonalities of luxury – superior craftsmanship, artisanal design and best quality sourcing – can tell stories or create experiences with mass appeal. This being relevant to scaled luxury businesses or those with like ambitions.”

To achieve this, luxury will shift to become a value proposition, says the brand manager for a British men’s tailoring company. “There are brands being very savvy coming into this luxury space who have worked out the behaviour of a luxury brand, come in a bit cheaper and are doing incredibly well. What it’s making us all do is think about our value proposition. And if you don’t have a strong value proposition with the customer, they’re gonna catch you out and it’s going to finish,” he adds.

Competition from premium brands and luxury startups will only continue. The focus on value – rather than cost – is a way in which brands can justify their expense and their exclusivity while remaining relevant to people’s lives and interests. “You have to be so much better at defining why you’re spending that much money,” the brand manager says. Education comes into play, as does involvement and conversation about topical issues like sustainability.

For the chandler and a British luxury chocolatier, allowing customers to participate in the process of making the product, the brand is building connections and establishing their value and worth.

Sustainability is not often on the top of the communications agenda for luxury brands. Yet on the B2B side, some like L’Oreal, have made sustainable business part of their core purpose. One attendee explains a detailed sustainability programme before adding that it would never be used in communications. However, for the chocolatier and brands that use sustainable energies inherently, sustainability is built into the brand offer; cocoa farming must become sustainable to ensure a consistent supply. Yet this conversation is yet to make it into the consumer-facing communications channels in the luxury sector.

But, if required by the brand in the future, it may just do so. Because, ultimately, it’s brand that counts in luxury. Dinghile adds, “In an industry that is luxurious and ornate and has so much depth to it, sometimes it is a challenge to understand its value. That’s clearly not the case. Being true is the sign of a strong brand a brand that will survive. The rules haven’t changed, the opportunities have changed.”