Marketers of luxury have four notes at their command, to play music with their consumers – product, service, experience and brand. To attract and retain high net worth consumers, get greater share of their wallet and to convert them into loyalists, fans and advocates is an ongoing challenge. In a competitive luxury market place, marketers cannot afford to pick one or two of the notes as their signature tune. They need to play the full chord of all four notes, while still highlighting one or two notes as their signature tune.

Creating products with the potential for an aura of romance is the way to attract those who ‘love’ the product.  Many products have an intrinsic mystique for a certain group of people – there are bike lovers, car lovers, watch lovers, pen lovers, spa lovers, foodies, fashion lovers, wine lovers, whisky lovers, cigar lovers, hi-fi sound lovers, the list goes on.  At their best and finest, luxury products appeal to the hedonist, the potential collector and connoisseur in all of us.  The much loved product can be a source of endless pleasure and even joy to its owner, especially when experienced in the company of a fellow product lover.  The trading of stories and knowledge, the sharing of obscure bits of information, the shared consumption all go to building a bond among fellow connoisseurs.  Equally, competitive envy and the desire not to be out-done by others, often acts as a spur to ongoing consumption.  And the reward of product purchase arises as much in establishing competitive superiority as it does in the intrinsic pleasure of using the product.  For luxury products to sustain their love affair with their users, the golden rule is authenticity.  The Fake vs. Real dilemma, when played out in a social context acts as a sieve for the ‘true’ product lover to suss out the ‘fake’ product lover and the ‘true’ sophisticate to identify the ‘arriviste’ and the ‘wannabe’.

Those who are at the top of the social ladder are used to being ‘served’.  They grow used to having their wishes gratified, their whims fulfilled and their preferences met.  They are accustomed to the idea that the world exists to please them and ensure their well-being, rather than the other way around.  Thus luxury service addresses the King or Queen, the little Prince or Princess within all of us.  Buyers of luxury service want to have completely personalized and customized service at their convenience.  At the very top, they are able to command the services of the very best craftspeople and the most knowledgeable product experts.  Luxury service is all about elevating the buyer to higher and higher levels of distinction vis-à-vis his fellowmen and women.  The golden rule of luxury service is thus, ego elevation.  However in an era of at least notional egalitarianism and media dominated celebrity culture, where even ordinary people aspire for and can claim their seven minutes of fame, the relationship between those who  serve and those who are served, becomes more complicated.  Even the richest and the most powerful have reason to fear those who serve them, because the latter can use the power of media and celebrity culture against them.  Everyone knows that the masses are always hungry for negative stories about the rich and famous!

Even Imelda Marcos perhaps ran out of cupboard space in her palace for her shoes.  The most compulsive product addict will eventually exhaust his or her appetite for buying more of the beloved product.  But experiences know no limits.  At one level, life itself can be thought of as a series of experiences.  So, there is no saturation point for fresh experiences.  The quality of an experience is experienced totally subjectively and is dependent upon personality and context.  What is worthwhile, fulfilling, meaningful, talk worthy and memorable is unique to each individual and hence cannot be duplicated.  Even simple joys, if rare, can become luxuries.  Sachin Tendulkar and Shah Rukh Khan may enjoy playing frisbee with their children in London’s Hyde Park and feeding the ducks.  Such uninterrupted privacy and space to experience fatherhood are a luxury in an Indian super star’s life.  The golden rule of a luxury experience is memorability.  It needs to stand out in the minds of even the most jaded person who has ‘seen it all’ and ‘done it all’ as a moment to cherish, a moment to remember and something worth talking about.  Sensitivity to nuance and a robust imagination are critical, both to creating and appreciating memorable experiences.  

What about the fourth note, the Brand?  If the product is of outstanding quality, the service superb and the product use experience is engineered to be totally memorable, then what is the role of the brand in the mix?  All of these need to be enveloped within a recognizable aura to have social cachet and currency and the pedigree of the name behind it all, is key to the credibility and sustainability of the aura.  So, brand name matters.  Can pedigree be manufactured?  Or is it so inextricably tied to origin, so the designer, craftsman-jeweller and/or birth place are critical?  A luxury brand cannot become sought after if its pedigree is suspect.  That makes pedigree, the fourth golden rule of luxury marketing.  Nothing creates aura more strongly than a powerful story of the owner/designer’s passion for his creation alongside nuggets of history of the brand’s appeal to the rich and famous people of the time.

Luxury is seductive and powerful and has been so since the beginning of time.  However, in earlier eras, the experience of luxury was restricted to a tiny elite called the nobility.  Modern times have seen the democratization of luxury with the upper middle classes in all societies having access to luxury products, services and experiences as part of a lifestyle upgrade.  Marketers of luxury need to know how to play the four notes together and in tune to create offerings that are music to the ears of their customers.

Creating Branded Experiences

Exclusively located in Burj Khalifa, the world’s tallest building, Armani Hotel Dubai will be the first hotel to bring to life the Stay with Armani promise. Armani’s signature style is woven into each of the 160 guest rooms and suites. A powerful designer brand, a preferred location for the world’s wealthy, a desirable concept all come together with the intent to create a branded experience for the well heeled, the Armani Hotel.  Everything about the hotel seems to suggest not just generic luxury but rather an immersion into  Armani’s own lifestyle.  If you can afford to spend $1000-10,000 per night, you can live like Armani does, is the implicit promise of “Stay with Armani”. 

However, a luxury marketer would do well to note and learn from this effort to create a strongly branded experience of luxury hotel stay.  How do you turn something as generic for the wealthy business man and top professional, as a night’s stay in a top-of-the-line hotel into a branded, differentiated experience – one that is memorable and satisfying?  A powerful concept such as Living the Designer Lifestyle when executed by Armani himself is a one-of-a-kind promise.  The Armani Hotel plays all the notes of the luxury chord – high quality products, superb service, a unique experience wrapped in a Designer Aura.    

Brand-Customer Conversations

One of the significant challenges of luxury marketing is designing and directing the nature of the Brand-Customer conversation.  This includes the explicit and implicit codes of communication.  The fundamental issue is the power dynamic between the Brand and the Customer.  Luxury service is all about ego elevation of the customer and hence the assumed power distance between the brand and customer is of utmost importance.  Who is more powerful – the customer or the brand?  Who respects the other more?  Who cares more about the opinion of the other?  So much of the luxury world is about the subtle and not so subtle markers of inclusion and exclusion that no luxury brand can afford not to take a position on the issue.

Is the brand the expert on luxury, on product quality, on craftsmanship, on the romance of the product/service category and the consumer the novice?  Is it incumbent on the brand to educate the customer to raise him/her to its level of knowledge?  Or are the brand and consumer equals in their knowledge and experience of the world of luxury?  And is this revealed in the gestures the brand makes to cement its relationship with the customer?  Is the customer the King because he pays and is to be treated as such, even if he/she is ignorant or simple in his luxury orientation and not a sophisticate?  Should the brand’s rule be that every customer is to be treated with respect irrespective of his manners?  Or is the Designer the King and the customer the privileged one who gains access to the King’s style through the power of his wallet?  And is the customer expected to respond with awe and appreciation for the access obtained as well as the privileges and experiences granted to him?

The actions that flow out of the brand’s position on power distance impact the customer experience in entirety.  First of all it impacts the kind of people who are hired in customer facing functions as well as in the back office.  Then it impacts their training and skills and how they are taught to interact with prospects as well as with customers.  It impacts the décor and styling and the implicit communication codes of these.  Finally, it impacts the rules for dealing with negative situations that are bound to occur.   

Hamsini Shivakumar is the Co-founder, Leapfrog Strategy Consulting



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