Brand Engagement and Luxury Brands

Over the past years, the luxury industry has been facing a number of market and consumer changes that have led to a revolution forever changing how the luxury brands approach their market. The economic crisis kicked in and brands were forced to consider broadening their communication in order to reach enough consumers to sell their goods. The digital revolution meant that luxury brands had to relate to a whole new communication channel that offered huge potential but also potential danger!

By: Linda Christensen
Published: 22-01-2014

What is luxury?

Let us start by defining ‘luxury’:
‘Luxury brands are regarded as images in the minds of consumers that comprise associations about a high level of price, quality, aesthetics, rarity, extraordinariness and a high degree of non-functional associations’.

Consumers have a clear picture of what a luxury brand is and what they expect of these brands.

Top three most popular luxury brands internationally among Top 50 income luxury consumers:

Consumers also have a clear idea about what they expect from a luxury brand and many of their expectations are centered around unforgettable experiences and building a relationship with their favorite luxury brand.

Luxury Brands & Traditional Code of Conduct
Luxury brands are operating in a world with a strict code of conduct. There is a way to act when you are a luxury brand and this code of conduct is respected by the real luxury brands.

From a communication point of view, this has been translated into a highly controlled strategy where brands would focus on the selected few and a presence in key communication channels that allowed them to stage and control the brand in the right way. This meant a focus on e.g. glossy fashion magazines, VIP events and creation of limited editions that were hyped via controlled PR launches.

The LVMH Luxury Group is representative of the general media approach of the luxury industry still indicating a high focus on print.
LVMH media spend split in the US in 2012:

Key words for the luxury brands were: High brand control and limited access rendering the brand accessible only for the ‘happy few’.

Luxury brands have thus been known to lead a very conservative communication strategy – but on the other hand, it is also luxury brands who have created some of the most innovative and spectacular creative ideas. Because they have to stand out. Because them sell dreams. Because it is expected of them. Because they value quality over quantity.

The Game Changer
The game changer for the luxury brands has come in the shape of key market and consumer changes:
- A global economic crisis
- The digital revolution

A global economic crisis
The seriously rich have been