Luxury purchases account for close to 46 million adults in the US, according to a recent study published by Shullman Research Center. According to Shullman, 85% of all luxury purchases at full retail price for fragrance, fashion, furnishings, travel, and automotive come from households earning $500K and above. Almost 88% of these sales take place in store, and 78% of such purchases start online, either through social media buzz or online research. But, marketing to the uber affluent luxury consumer requires a delicate balance between consumer insights, product placement, public relations, sophisticated promotions, and creative messaging. Sounds a lot like the four P’s of traditional marketing, but for uber luxury affluent messaging, they can take on new meaning.
To be noticed by this discerning and elusive consumer, luxury marketing goes beyond the assembly of vocabulary and visuals and extends into the orchestration of being seen in the right places and being used, worn, or driven by the right people. Marketing to upscale sophisticates is not about price but rather about the emotion a campaign evokes and the call to action that naturally evolves from it. It’s not about expecting a click through in digital response or call volume to measure conversion, but more about the social buzz that is created. A luxury consumer responds to a campaign through adoption of the brand position, creating loyalty, and recognition that transcends time.
There are two primary marketing challenges that affect the success or failure in luxury messaging. The first is in moving a product from a more traditional transactional price position to the upper end luxury tier. (One example is the successful relaunch of Audi in the Superbowl a few years ago which enabled the brand to move from the ninth position in market share to right behind Lexus, BMW, and Mercedes within a 12-month time frame.) The second biggest challenge is when a beloved luxury brand moves to a more mainstream position in its pricing model, hoping to capture the younger affluents without alienating the blue-blooded traditional loyalists. In doing so, the brand runs the risk of cheapening its product perception with a lower price point. (Mercedes fell victim to this strategy a few years ago when introducing its more affordable models and immediately saw an erosion in market share and displaced revenue from its more profitable models. A move Mercedes was quick to recognize and rectify.)
Luxe marketing is a strategic balance of staying true to its authenticity and exclusivity. To elevate reach and maintain a position above the mainstream and mundane, luxury brands must be creative in their approach and innovative in their creativity. The kiss of death is trying to be something to everyone. Success can be accomplished through the clever art of messaging, understanding the affluent mindset, and being brave enough to not deviate too far from the path of luxury momentum. Slow and steady wins the race in the pursuit of luxury versus going for the fast and hard transactional sale.
Smart marketers in the A-List category step outside their traditional marketing toolbox and open up to include non-traditional media, public relations, celebrity marketing, product sampling, and placement. They let their audience help to define their brand following by attending high profile events, charity galas, and red carpet arrivals. It’s all about matching the image of the brand to the places it is seen, worn, or adopted and talked about among the affluents. Luxury marketing is a lifestyle sell and often takes on its own persona, manifested in creating the right image for the brand name. The trick is in acting like a luxury brand and not turning into a discounted transactional sell too fast.
Lifestyle marketing is a specialty of The Point Group. It’s about stretching the imagination and determining the right approach to image-making advertising. Positioning brands in the upper echelon translates to a holistic marketing approach that takes all aspects into consideration. Blending it all together into a play that optimizes conversion and elevates the brand into a viral play are what make all the difference. Let us help you take your brand to the next level on the luxury tier.