How luxury brands do marketing | 24 Anti-Laws of Marketing

Summary

This episode of 'Fashion Brief' delves into luxury marketing strategies, distinguishing between luxury and premium brands. It highlights the unique 'anti-laws' of luxury marketing and how brands like Louis Vuitton redefine luxury. The video explores the importance of craftsmanship, the role of advertising in building brand awareness, and the value creation in luxury goods. It also touches on the significance of brand origin and the preference for enthusiasts as customers. The episode teases further analysis on Gucci's shift towards a luxury strategy under Alessandro Michele, inviting viewers to stay tuned for more insights.

Takeaways

• 👜 Gucci is considered a luxury brand, especially under the creative direction of Alessandro Michele, moving towards a luxury strategy.
• 💎 Luxury brands are dream builders, not just high-priced items, and their value comes from the brand's positioning and strategy, not solely from price.
• 📚 The book 'The Luxury Strategy' by Vincent Bastien and Jean-Noël Kapferer is a key reference for understanding luxury brand management.
• 🛍️ Luxury brands follow 'anti-laws of marketing', with 24 specific rules that sometimes are adapted or redefined by leading luxury brands like Louis Vuitton.
• 🔍 Premium brands like Hugo Boss differentiate themselves by offering more for a higher price, focusing on functionality and benchmarking.
• ⌚ The appeal of luxury goods, such as mechanical watches, often lies in craftsmanship rather than just functionality or accuracy.
• 🎨 Luxury brands use advertising to build brand awareness and create an approachable dream, rather than to directly sell products.
• 💰 Luxury brands set the price as a reflection of their value, and an imagined higher price can create additional perceived value.
• 🚫 Luxury brands lead the market and consumers, not the other way around, often going against traditional marketing practices.
• 🌟 Celebrities are kept out of luxury brand advertising to prevent them from overshadowing the brand's image and values.
• 🏛 Luxury brands are closely connected with art, often choosing classical art that suggests timelessness over popular trends.
• 🚫 Luxury brands aim to attract enthusiasts who fully embrace their values and may intentionally limit accessibility to maintain exclusivity.

Q & A

Is Gucci considered a luxury brand or a premium brand according to the transcript?

The transcript suggests that Gucci is moving towards a luxury brand strategy, especially with the new creative director Alessandro Michele, but it does not provide a definitive answer and promises further analysis in future episodes.

What are the 'anti-laws of marketing' mentioned in the transcript?

The 'anti-laws of marketing' are a set of 24 marketing principles specific to luxury brands, which are contrary to traditional marketing practices. The transcript does not detail each of these anti-laws but implies that not all may be applicable to current luxury brand strategies.

What differentiates luxury brands from premium brands in terms of marketing strategy?

Luxury brands focus on building dreams and are not comparative in their positioning, whereas premium brands operate on a 'pay more, get more' strategy with an emphasis on functionality and benchmarking against other brands.

How does the transcript describe the role of advertising for luxury brands?

The role of advertising in the luxury context is not to sell directly but to build brand awareness and showcase an image that represents the brand's spirit, often without featuring the product itself.

What is the significance of the country of origin for luxury brands as discussed in the transcript?

The country of origin is significant for luxury brands as it adds to their perceived authenticity and heritage. Luxury brands often maintain a strong connection to their origin to uphold these qualities.

Why do luxury brands avoid using celebrities in their advertising according to the transcript?

Luxury brands avoid using celebrities in advertising to prevent the stars from outshining the brand itself. The focus should be on the brand and its values rather than the celebrity.

What is the relationship between art and luxury brands as discussed in the transcript?

The transcript suggests that luxury brands have a close connection with art, often seeking to be curators of taste and gravitating towards timeless classical art rather than popular art.

What type of consumer do luxury brands prefer according to the transcript?

Luxury brands prefer enthusiasts who wholeheartedly share their values. They aim to keep non-enthusiasts out to maintain a select and dedicated consumer base.

How do luxury brands create value for their products, as mentioned in the transcript?

Luxury brands create value by setting their own prices, raising prices annually, and making products seem valuable through marketing strategies that focus on dreams and non-accessibility.

What are some of the 'don'ts' that luxury brands follow according to the transcript?

Some 'don'ts' for luxury brands include not testing, not seeking consensus, not looking after group synergies, not pampering customers' wishes, and not replying to rising demand.

How does the transcript describe the importance of the brand itself in luxury strategy?

The transcript emphasizes that in luxury strategy, the brand itself is everything. Luxury brands aim to lead the market and consumers rather than following them.

Outlines

00:00

👜 Introduction to Luxury Branding and Marketing Strategies

This paragraph introduces the concept of luxury branding and the distinctions between luxury, premium, and fashion brands. It poses the question of whether Gucci is a luxury or premium brand and sets the stage for a discussion on luxury marketing strategies. The speaker references the book 'The Luxury Strategy' by Vincent Bastien and Jean-Noël Kapferer, highlighting its influence on their understanding of luxury branding. The paragraph also introduces the idea of 'anti-laws of marketing' specific to luxury brands, with a particular mention of Louis Vuitton's innovative approach to these laws. The focus then shifts to the role of luxury brands as 'dream builders,' emphasizing their non-comparative nature and the importance of brand positioning over price. The example of Hugo Boss is used to illustrate a premium brand's strategy, contrasting it with luxury branding. The paragraph concludes with a discussion on the imperfections of luxury products, such as mechanical watches, and the role of advertising in creating brand awareness rather than selling products.

05:03

🎨 The Essence of Luxury Branding and Consumer Dynamics

The second paragraph delves deeper into the luxury branding strategy, emphasizing value creation and the crafting of dreams that are both unattainable and within reach. It discusses the independence of luxury brands from market trends and their role as market leaders rather than followers. The paragraph outlines several 'don'ts' that luxury brands adhere to, such as not catering to customer wishes or responding to rising demand. The importance of a brand's origin is highlighted, using Italian luxury brands as examples, and the connection between luxury and art is explored, with luxury brands favoring classical art for its timelessness. The paragraph also touches on the type of consumers luxury brands prefer—enthusiasts who share the brand's values—and the strategies employed to maintain exclusivity, such as the example of purchasing an Hermes bag. The dual nature of luxury value for oneself and for others is discussed, and the need for a broader brand familiarity is emphasized. The paragraph concludes with a teaser about Gucci's shift towards a luxury strategy under its new creative director, Alessandro Michele, and an invitation for viewers to stay tuned for further analysis.

Keywords

💡Luxury Brand

A luxury brand is defined by its high-end products and services, often associated with exclusivity, quality, and a rich heritage. In the video, luxury brands are portrayed as 'dream builders' that are not merely about high prices but also about creating an aspirational image and experience. Examples given include Louis Vuitton, which is described as redefining the meaning of luxury through its innovative collaborations and style.

💡Premium Brand

A premium brand is positioned below luxury but above standard brands, offering products with enhanced quality and features at a higher price point. The script mentions that premium brands like Hugo Boss differentiate themselves through functionality and a 'pay more, get more' strategy, with sub-brands targeting different consumer segments.

💡Brand Positioning

Brand positioning is the strategy of creating a unique image or identity in the minds of consumers. The video discusses how luxury and premium brands position themselves differently, with luxury brands focusing on non-comparability and premium brands on functionality and value for money.

💡Anti-Laws of Marketing

The term 'anti-laws of marketing' refers to the unconventional marketing strategies employed by luxury brands, which often contradict traditional marketing principles. The video script mentions that there are 24 such anti-laws, and it uses Louis Vuitton as an example of a brand that pushes the boundaries of these laws.

💡Mechanical Watch

A mechanical watch is a timepiece powered by a mechanical mechanism, which is often less accurate than its quartz counterpart but highly valued for its craftsmanship. The video uses mechanical watches as an example to illustrate why consumers might choose luxury items for reasons beyond functionality.

💡Advertising in Luxury Context

Luxury advertising is not about selling products but about building brand awareness and evoking a dream or aspiration. The script contrasts this with functional advertising, citing a Cartier ad that showcases an image rather than a product, aiming to embody the brand's spirit.

💡Value Creation

Value creation in the context of luxury brands is about making products seem valuable and desirable, often by setting prices that are perceived as higher than the actual cost. The video explains how luxury brands intentionally create an imagined higher price to enhance the perceived value of their products.

💡Market Independence

Market independence refers to luxury brands operating independently of market trends and consumer demands, leading rather than following. The video emphasizes that luxury brands have their own motto, 'Don’t follow anyone,' and they aim to set their own paths rather than conforming to market pressures.

💡Country of Origin

The country of origin is important for luxury brands as it can signify heritage, craftsmanship, and authenticity. The video mentions Italian luxury brands and how their origin is integral to their brand identity and appeal.

💡Art and Luxury

The connection between art and luxury is highlighted in the video, with luxury brands often being associated with creativity, boldness, and timelessness. Luxury brands are described as preferring classical art that suggests a lasting legacy over popular or trendy art forms.

💡Enthusiasts

Enthusiasts are consumers who are deeply engaged with and passionate about a brand's values and products. The video explains that luxury brands prefer enthusiasts because they align with the brand's values and are more likely to appreciate the non-accessible yet approachable dream that luxury brands create.

💡Luxury for Oneself and Others

This concept refers to the dual value of luxury goods, serving both as a personal indulgence and as a status symbol for others to recognize. The video discusses how luxury brands aim to have a broad familiarity among consumers, even if only a select few can afford to purchase their products.

Highlights

Gucci is a luxury brand, not a premium brand.

Luxury brands are differentiated by more than just price.

Luxury brands are special and irreplaceable due to their unique qualities.

There are 24 anti-laws of marketing in luxury that brands follow.

Louis Vuitton redefines luxury by pushing the boundaries of traditional marketing laws.

Luxury brands are dream builders, not just product sellers.

Luxury brands do not use comparative positioning like premium brands.

Premium brands focus on functionality and 'pay more, get more' strategy.

Hugo Boss is a prime example of a premium brand with distinct sub-brands.

Many brands blur the lines between luxury, premium, and fashion strategies.

Mechanical watches, despite their flaws, are valued for their craftsmanship.

Luxury advertising focuses on building brand awareness rather than selling products.

Luxury brands aim to create an approachable yet exclusive dream for consumers.

Luxury brands are independent, not following market trends but setting their own path.

Luxury brands avoid using celebrities in ads to prevent overshadowing the brand.

The country of origin is crucial for luxury brands, adding to their prestige.

Luxury brands prefer classical art that suggests timelessness over popular trends.

Luxury brands target enthusiasts who fully embrace their values.

Luxury brands intentionally limit accessibility to maintain exclusivity.

Hermes exemplifies luxury brands' selective customer qualification process.

Luxury has dual value facets - for oneself and for others to aspire to.

Brands often combine luxury, premium, and fashion strategies based on their core focus.

Digitalization and changing consumer behavior force brands to be more flexible in their strategies.

Gucci's shift towards a luxury strategy under Alessandro Michele will be further analyzed in future episodes.

Transcripts

Quick question:

Is Gucci a luxury brand or a premium brand?

Speaking of luxury brands, some brands might pop up in your mind

And many people differentiate luxury brands by price but is it correct?

What makes luxury brands so special and irreplaceable?

Are there any rules of being luxury brands?

What is the difference between luxury, premium and fashion strategy?

You’ll figure that out via this episode.

Hi everyone! Welcome to fashion brief!

This episode I would introduce luxury marketing strategy

This will be a general guide for you to differentiate brands by brand positioning

The information is based on a book called the luxury strategy.

Written by 2 scholars Vincent Bastien/ Jean-Noël Kapferer are internationally recognized thought leaders on brand and luxury management

and both of them are professors at HEC Paris.

This is actually a book that opened the world of luxury for me

So I think it is also necessary for you to know

If you are interested in the book, I also put the link below.

According to the question I asked the beginning,

are there any special rules of being a luxury brand?

Yes there is.

There are some laws of marketing in luxury

It is called anti-laws of marketing

There are 24 of them

However, personally I do not everything can be applied to the current situations now

when we observe from what the luxury big names are doing

For example, Louis Vuitton the brand in my point of view is playing on the edge of the laws

For either style or collaboration with streetwear brands

But I mean if they are one of the pioneers of luxury brands

What can we say?

Maybe they are also redefining the meaning of luxury

Let’s figure that out!

Luxury brands are dream builders.

Speaking of luxury brands

We really need to forget about ‘positioning’ because they are not comparative

In comparison to premium brands although they are also in a higher-level positioning

They tend to leak information of some functions in their marketing strategy

Premium strategy is about pay more get more

Functionality is key because it enables consumers to benchmark and compare

with different functionalities and brands

For me, the best example of premium brand is Hugo boss

Hugo boss’s brand strategy is divided into 2 sub brands namely HUGO and BOSS

HUGO is young and hipster

while BOSS is more mature and premium

I have to say plenty of brands set their brand strategy in between luxury and premium strategy

Sometimes it is not easy to differentiate

Also although luxury products are expensive with high quality

They are not flawless

I think this example should be interesting, namely “watches”

There are two sorts of watches which are mechanic & quartz

The biggest flaw of mechanic watches is that it's not as accurate as quartz watches

Why do people still buy mechanical watch?

People buy it because of its craftsmanship

Speaking of advertising, the role of advertising in the luxury context is not to sell

Namely they usually provide or demonstrate a pure visual

Instead of emphasizing on some functionalities of some products

Take the Cartier ad for instance

you can see there’s only one panther in the middle

With a red classic Cartier box

This is really obvious that they are not trying to sell any products

Because there is no product in the ad

Rather they showcase just an image representing the Cartier spirit

So what's the aim of advertising in luxury?

The aim is to build up brand awareness of course

And also keep reminding consumers that this is the dream you are chasing for

Luxury customers are normally educated customers.

They are ready to pay more... but getting much more.

Luxury sets the price, price does not set luxury

This is also the reason why people misunderstand expensive products are luxury goods

It really depends on the brands’ positioning and strategy

In luxury when an imagined price is higher than the actual price, it creates value

Normally if we don’t have an idea of the price range for luxury brands

We might guess it in a higher price level than its actual price

And this is exactly the endeavor that luxury brands are doing

to make us feel the products are valuable

If you have the experience of buying luxury goods

You might notice that the price will be raised by certain percentage every year

By doing so, luxury brands are also creating even more value for the products

Luxury strategy is mainly about value creation, namely building up dreams

Dreams have a dimension of non-accessibility yet remaining at a close distance

Hence, it is important to create an approachable dream

Now you might notice that luxury brands are independent from the market

They are walking on their own way

“Don’t follow anyone” is exactly the motto of luxury brands

The brand itself is everything

And there are lots of don’ts

“Do not test

Do not look for consensus

Do not look after group synergies”

And there are some interesting don’ts that are really against how the market works

Don’t pamper your customers’ wishes

Don’t reply to rising demand

Luxury brands need to lead the market and consumers not the other way around.

Due to the fact that luxury brands put themselves in the center

Chances are high that celebrities might outshine the brand in the ad

This is what luxury brands want to prevent at all cost

Just keep stars out of advertising

When we think about certain luxury brands for example Prada, Tods, Bottega Venetta

They are from Italy

It might be easy for us to connect the country of origin of the brands

So now you understand why luxury brands are not leaving their origin

Because it is really impoortant for them

Now let’s talk a little bit about art

Normally the connection between art and luxury is close

As we know that luxury brands don’t like to follow anyone

and prefers to be the curator of taste

They seek to be creative, bold and different

Hence, its decision to stay away from popular art

Instead, it gravitates towards art that suggests timelessness such as classical art

Now I have a question in between

What kind of consumer do luxury brands like the most?

Enthusiasts!

That’s why luxury brands are making every effort to keep the non-enthusiasts out

Because they need someone who share wholeheartedly with their values

Well although luxury brands like enthusiasts, they tend to lower the accessibility

I’m not so sure whether you heard the story

that it’s actually not easy to purchase some of the luxury goods

Take Hermes bag as an example

you actually need to be qualified by the brand until you are be able to buy the bags from Hermes

Because the customers luxury brands want are those who really understand the brand or product

However, it is also important to communicate to those whom you are not targeting

Luxury has two value facets – luxury for oneself and luxury for others

To sustain the latter facet, there should be many more people that are familiar with the brand than those who could possibly afford to buy it for themselves

There, the distinction between luxury, fashion and premium strategy of prestige brands operating on the luxury market is crucial

Since the purchase needs time and effort to be deserved

I will talk a bit more about the relationship between luxury brands and internet in the following episodes

So now from my explanation

you might notice that not every brand follows purely luxury, premium or fashion strategy

It is normal that they combine these strategies together by sticking to a core strategy

I think the digitalization and the change of consumer behaviour

Force the brands to be more flexible

Let’s go back to the unanswered question:

Is Gucci a luxury brand or a premium brand?

I would say since the inauguration of the new creative director – Alessandro Michele

The brand is heading toward luxury strategy

Want to hear more why I would say Gucci is now heading more to luxury strategy?

Stay tuned to future episodes for futher analysis!

That’s basically it

If you like my video, please give me a like and subscribe my channel

Tell me about whether you agree with these laws or not

Also, share with me what kind of analysis you are interested in!

See you next time!