The Dilemma of Digital Marketing for Luxury Brands

http://www.theguardian.com/marketing-luxury-goods-feb-15/2015/feb/16/digital-marketing-luxury-brands

This article made me think about the difficulty luxury brand marketing managers face when determining their marketing mix. Many luxury brand customers are likely wealthy people over the age of 35 with a positive correlation between age and their status as a luxury brand consumer, so they are more likely to respond  to the old types of marketing channels. The younger generation has a smaller number of luxury good consumers, but they are the future (assuming we ignore all of the doom & gloom articles about the future written by baby boomers moaning about lazy and entitled millenials), and they respond to a whole different set of marketing tools.

This begs the question, “How does a  marketing manager determine their mix?” Customers who have the largest wallet are an easy target and produce immediate results, but focusing on this segment ignores the future. Does the marketing manager necessarily care about penetrating a segment that will pay off in 20-30 years? I would doubt it, since it won’t affect next quarters earnings.  I think this can be observed in the article with the following quote,

“ There were signs of scepticism in the audience over the merits of digital. One question submitted to the panel via the app quickly rose to the top as people voted for it to be discussed: “The return on investment (ROI) is not as big with digital, so why should we invest in digital advertising?”

And I thought the  response was perfect.

“You are building a relationship with people who may continue to use your product for the next 25 years. Those interactions that you have, particularly through social streams that you can get through digital, are super valuable. It would be a shame not to invest in that.”

It’s easy for a consultant on this panel to say the investment in digital is valuable, but it’s another thing for the practitioner to implement that when they are being pressured by management to produce immediate results.

Luxury Brands and Retailers Still Cautious about Social Media

In the history of marketing, luxury retailers have usually been the last to adapt to technology including radio ads, television commercials, digital marketing, and social media.  While tons of retailers have embraced Facebook and Twitter as the holy grail of social marketing to reach the masses, luxury brands have preferred to not share the spotlight, deciding to remain niche and elite.  However, as social is become a key platform for marketing, some luxury brands are now accepting the inevitable.  Luxury brands Chanel, Burberry, and Louis Vuitton have started to see the value and ROI of social media.  Chanel recently began posting photos on its official Instagram account – and gained more than 2 million followers.  Burberry is now dedicating 60% of its budget to digital, while Louis Vuitton used Instagram to plant clues for followers in order to create buzz for Paris Fashion Week.

However, other high-end brands continue to be reluctant in using social, including Apple, Rolex, and even online publisher Monocle.  It sounds counter-intuitive that a culture/design publication would not try and push its articles via social media.  Andrew Tuck, editor at Monocle, explains “[Social media] feels like a little too much exposure.  For our brand, it seems just a little bit uncomfortable.” Rolex has a Facebook page that is over a year old, but only posts a few times a month.  The brand’s Twitter and Instagram pages are protected.  As the most valuable technology company in the world, Apple is also one of the least engaged in terms of social marketing.  Samsung, one of Apple’s biggest competitors, had the most number of retweets on Twitter with Ellen DeGeneres’s Oscar selfie with multiple celebrities, beating President Obama’s record.

While it may take months or years before luxury brands fully accept digital and social media, the brands will inevitably embrace this change in culture. 

Source: http://www.adweek.com/news/technology/luxury-brands-are-still-casting-leery-eye-toward-social-media-161155 

Luxury Online Flagships Go For a Redesign

Luxury brands have traditionally been a bit slower to take up new technologies, therefore it is interesting to watch when and at what pace they play catch up. Recently some brands have rolled out more frequent website updates to drive traffic from both a search perspective, and visual and UX standpoint. Aston Martin chose to announce the redesign of their site via the brand’s social media outlets, instead of simply releasing the changes through an announcement on the site page itself, noting on Twitter both the “new and improved homepage design and navigation.” This was an interesting tactic for Aston Martin because it helps drive current brand enthusiasts to the new site, in effect to test out changes, tracking time spent on the site and identifying the most popular areas or content. Instead of having to navigate to a particular model, the different cars are the first menu options at the top bar, and slide across as full-screen images on the home page. As most users are likely looking for a particular car within the Aston Martin line, it was advantageous for the company to retool the site to align more closely with those search inquiries and page visits.

Marc Jacobs also recently revamped its online flagship, taking away some of the hierarchy to streamline the process of viewing and purchasing the product. The side menu is now organized in the same way in which customers would shop in-person, structured by gender, rather than by collection. Once navigating to the women’s section, the grid layout carries over from the home page, but there is also a split screen with two scroll bars. This could prove somewhat confusing or overwhelming, but does allow the site to push a ton of content and descriptors onto one page, which may help drive traffic from a search perspective.

Providing frequent website updates can help a brand stay relevant, not only through its content but also by staying up to date with developments in web design and architecture. Incremental changes make it easier to stay on the forefront of a competitive market that demands unique online experiences, meaningful content, and ease of use – and that’s just once the customer is already on the site. Driving customers to the online flagship requires proper understanding of the back end design as well, which Aston Martin and Marc Jacobs appear to recognize and work towards.  

Luxury Brands in the Digital Space

Like any other women my age, I have a bit of a taste for luxury brand bags and shoes. Shocker there, right? But I'm also a marketer and interested in how some of my favorite brands play in the digital space. And of course, most of them don't! Fashion houses like Gucci and Prada, which are historically elitist, have an opportunity to push themselves into the mainstream without losing their aura of exclusivity which has been an ongoing concern. Hence, the Digital Marketing Commandments for Luxury as pointed out by mashable.com. It's an interesting and fun read.. My personal favorite is the push towards actually spending time and money on digital media. You can't just repurpose content from a print ad and expect it to work in a social media campaign. Following these rules will help further elevate a lot of these brands by further creating a following and envy.

http://mashable.com/2011/10/11/digital-marketing-luxury-brands/