What has been missing throughout this blog, will be my final post for the assignment.
It is all about creating and developing a service. People may not realize that products and services differ in a huge way. The biggest challenge for companies when they sell (luxury) services is making people pay for something intangible.
Important aspects to know about services:
- You can't stock services
- Once you delivered it, it's gone.
- Services are intangible
- Customers are co-designers of the service, it is an inter-relational exchange.
However, like in the normal marketing mix, the service marketing mix has the 7P's as well.
- Product: These services are the products. They are all about heterogeneity. Not 1 service is exactly the same, nor is the why the service is being experienced.
Most of the time, a service doesn't stand alone on its core product. There are facilitating as well as enhancing services around it. This is being shown by the Flower Of Service
All the elements if the flower are assuring that a service has to be as unique, convenient and good as possible to fulfill the needs of the customers.
It should work as a checklist.
- Price: A service offered to the clients are free or to be paid. The core of the service often is at a cost (hotel overnight, for example). Any of the other complementary service for the checklist is optional/free in the price of the core/.... It depends on how the company, offering the service, wants to position itself towards their clients.
- Promotion (Marketing Communication): Like mentioned before in the blog, the marketing communications have to be in line with the DNA of the brand. Choice of channels, choice of colors, music, emotions,... All these elements have to match the brand values and image
- Place: Place can be both the organization's place, or the customer's place or a random place
- People : The people aspect could one of the most important factors of the service mix. People make or break the service since a service always, ALWAYS involves interaction. Friendliness is not hard to show and can the experience for customers going from: 'It's ok', up to 'Woow, AMAZING'
- Processes: Blueprinting the service, online possibilities, self-service technologies...
- Physical Evidence: If a service is being performed away from the consumers home, in a hotel or shop for example, the environment is important. 5 senses are being stimulated, willing or not. Keep that into account!
If any of my loyal readers are willing to set up a service, keep in mind this post. Let the service match the brand DNA and values, like I made my Tiffany Service matching the current brand values and image.
And NOW...
If any readers wanting some tips concerning luxury brands, do not hesitate by contacting me on :
vic.dresen@gmail.com
Last day of class we brought a visit to the restaurtant Criterion on Piccadilly Circus.
Having one of the highest footfalls in London, it is still hidden away from the tourist. No advertisement, no screamy billboards, nothing to attract attention.
The picture on the left shows the entrance of the restaurant. Situated on Piccadilly Circus, literally thousands of people walk by the restaurant without even realizing that there is a restaurant.
But once you enter the restaurant, you WILL be amazed by the interior. The sober the exterior, the more beautiful and richness the interior is.
The set of following pictures illustrates this.
The dining hall.
The bar
Dining hall again
The ceiling, which exists out of pure gold and precious and semi-precious stones.
Like every brand and service provider, they also need to have an USP (Unique Selling Point) to differentiate themselves from the competition.
Criterion's first and main USP is this extraordinary interior. The ceiling, the room, the bar,... everything lives and breaths class and luxury. People come to lunch and dinner to see this interior.
However, to be a premium luxury restaurant and luxury brand in general, there is more to it than just looking good!
One of the aspects that makes luxury luxury, is the heritage and history. Criterion made good use of its heritage and history and you can see it in some 'subtle' placements in the restaurant and the restaurant's environment.
Sherlock Holmes and John Watson memorial wall inscription. The have visited the bar 1881.
A book with signatures and notes, all throughout history
Reference on their menu
First Page on their website
Another aspect why luxury brands can charge a price premium, and that is linked with the heritage, is telling a story. This makes people relate to the brand and giving them an 'excuse' to pay more.
The owners of Criterion also thought about this and they indeed are telling a story.
First of all with the heritage and history, also with the former and famous visitors.
But what was remarkable as well, was that even the promotional menu had a story around it. Every course was related to history and the period of Queen Victoria, like the apple and pear Sausage for example.
When talking about services, it is of biggest importance that the staff has the expected level as well. I haven't been to the restaurant for lunch nor dinner, but the way the staff was handling phone calls, handling us pleasantly surprised me.
The kitchen staff was really nice as well. We met headchef Matthew Foxon, who gave us a tour around the kitchen and interesting talk about the way the kitchen works.
Matthew is being promoted as a chef by Criterion. This is another aspect for luxury brands. A luxury brand focusses on handcraft. By promoting Matthew, they try to sell this craftsmanship to the customers.
Like mentioned above, Criterion is applying a lot of different aspects of luxury. Heritage, storytelling, craftsmanship, environment,... all these elements are contributing to the status of Criterion as a luxury restaurant.
The only thing that is missing in this post, is the analysis of the food. I haven't got the opportunity yet, but that will come. (one day)
The new trend for Luxury Brands is Sustainability.
According to many specialists in the sector, it is the new hype of CSR and charity events.
But what is sustainability?
Is it the way you treat the employees? The way you product? What happens with the products after they served their time? Sustainability is all about these issues.
Luxury brands have the responsibility of ensuring the same future for next generations as well. Because luxury brands are as precious as the earth itself!
What are sustainable goods? Goods like jewelry, sun glasses and watches are goods that can be a sustainable since the lifecycle of the products can be really long.
Patek Philippe made their USP of being a watch that is so sustainable that it is actually a watch that will be passed on towards next generations
Loro Piana is another brand that carries sustainability really high in their values. They use Vicuna fibres, while keeping them alive and breading them since they were almost extinct!
Some brand are really holding the values of sustainability in their 'hearts' and their DNA. On the other hand, almost all brands are doing it right now.
Do they really mean it, or do they just do greenwashing? Do they just go with the flow, as if it was a new fashion trend?
An industry that is under heavy criticism from sustainability point of view is the transportation industry. Cars, aircrafts, boats,... have a huge carbon footprint on this planet. A way to counter this criticism is being innovative and finding techniques to lower pollution. New fuels et all, are being tested when we speak by almost every single car manufacturer.
But why is the sustainable suddenly so popular? Due to the economical crisis, climate change and other worldwide events, people are getting more educated about the world problems. They suddenly start caring and they expect brands to do it as well!
The biggest wake-up call for the brands was the WWF report on luxury brands and their scores on sustainability. Not a single brand scores higher than a C+.
This raised questions out of the audience and society, so that luxury brands had no other way than changing the way they act.
This raises another ethical question: Do brands do it because of their brand values, or because of the value for their shareholders?
Yesterday, we have had the workshop of groups of 7/8 students each and they has to sell their ideas!
My group existed of Dana, Fleur, Lara, Nina, Ramla, Sonia and myself.
The Ideas
Dana:
Dana used Prada as a brand to achieve an extension for. She did propose Prada to make a make-up line. She felt that Prada already has a lot of products to complete the 'Prada-woman', except for make-up.
Fleur
Fleur took Manolo Blahnik as a brand and proposed them to make a hat-line.
Lara
Lara's Idea was launching a hotel for Hermes, in collaboration with Vertu and luxury car brands. The location would be at the lakes in Italy or Swizterland.
Nina
Nina proposed for Louis Vuitton bed linen
Ramla
Ramla had the idea of making a Louis Vuitton television in co-oporation with Sony.
Sonia
The last idea during my presentation group was Sonia. She proposed LVMH to buy an island in Brittany, the north-east of France, to build an resort on it as vacation resort. By invitation only!
My own idea you have already read during the previous posts in this blog. I won't go any deeper into it again.
Last class we have had a very interesting discussion about the use of models in campaigns and advertising.
What makes a company chose for supermodels and celebs, or the normal people on the street as subject and endorsers for their brand?
The choice is all about the dilemma of going for a recognizable face or for a credible person.
Some brands wishes to be a brand of the people.
Dove has made their decision on using 'real women' for the advertising campaigns. By using there women, they want to convince other women buying Dove, because the women showed in the ads are credible. They are 'just like them'.
This happens, when a brand wants to be on the same level as their customers.
It is doubtful that this approach will work for any luxury brand. Luxury brands have the intention of not being among the 'normal' people, but the brands want to have the image of being above the people.
The better option for luxury brands is using endorsees that people can aspire to. This fits the brand image better as well. No luxury brand wants to be amongst the people.
L'oreal, for example, almost always uses celebrity endorsement.
The company uses it for people to aspire to them.
Again, the choice for using normal people, super models or celebrities has to fit the brand image and brand DNA, just like everything else the brand does.
Continuing on the theory of previous post, this will be a product development.
I am proposing Tiffany to design a consultancy service to arrange 'love' affairs. This is a new product/service that will be launched in the market they already operate in: Product Development!
The details of my proposition:
3 main aspects to the consultancy service
- Wedding Planning Service
- Honeymoon Planning Service
- General Romance Service
The wedding planner service could be anything, varying from location search, to cake selection and security. Everything you can think of you might need during the wedding can be booked and executed by this service.
Honeymoon Planning Service is a travel agency-styled service that makes the honeymoon a vacation with stress and with exclusive things to do. From booking the hotel and tickets, up to airport pickup by limo and exclusive dinner reservations can be made by this part of the service.
General Romance Service can be booked just to make reservations in restaurants or limo pick-up.
More details are in the report, so I am not going to put my all my brilliant ideas on this blog ;)
I feel that by offering these services, Tiffany could enhance their Brand Values of Love, Romance and Care and become the ultimate 'Love Jeweler '. Therefore, this extension might just be able to work out great for Tiffany.
The assignment for Managing Luxury brands was inventing a brand extension and saying why it would work.
Before I post a summary on my finished project, I am going to give an overview on how Luxury brands can extend.
There are 2 possible ways of extending a brand.
The first way is extending following a verticall model, or the pyramid model
This model describes how brands can go upwards or downwards, concerning their brand stretching.
Important for a brand is that they realize that any movement on this pyramid will affect the image towards the 'original' brand.
A good example to apply towards this pyramid extension is Armani. Armani started as a Luxury Brand, with a Couture line (the Griffe) but during the years they have let themselves slip down the Pyramid, introducing Armani Jeans (Upper-Range) and Armani Exchange ( the Brand). This have had an crucial impact on the image of the brand. It went from an Italian Luxury Brand image, towards an High-street brand image. Eventually, his profit has dropped and there will be a possibility of Armani getting into trouble.
The other way of extending, is using a horizontal model. This model can be best explained, using the Ansoff Growth Model
This model focusses more on other products or markets, instead of downgrading or upgrading.
There are 4 different possibilities in Ansoff's matrix.
Market Penetration: Using existing models in existing markets. The goal of this growth strategy is being aggressive in the existing markets by trying to get more market share, trying to sell more and make more profit.
Market Development: Using existing products in new markets. The best example I can give you are nose strips. This was originally intended to stop snoring. Now, new markets did open: Sportsmen are using it as well. ( Just a simple example)
Product Development: Using new products in existing markets. This is what Apple did when launching their Ipad. They launched a new product, on the markets they already operate in.
Diversification: Launching new products on new, and mostly unknown markets. This is the most risky extension a company can do. At this moment, I do not have a good example of diversification.
What I will do with Tiffany, is a Product Development. More to come.
We were talking about Brand Values and Brand DNA before.
An important part of this DNA could be the founder or the designer. What happens to do when one of these go absolutely bonkers?
Who, in godsname, am I talking about? I think you know already.
Mr. John Galliano.
What did he do? Well if you didn't know already, he actually stated that Hitler is a hero. Bad move John, bad move!
It is a big shock in Haute Couture Country. John Galliano got fired from Dior. They stated that they don't want anything to do with Galliano again. Dior also apologized for what he said. This was probably the best thing Dior could have done, to save their own image.
Galliano's own brand will definitely suffer as well, no doubt. It is the question if he ever would get work again, because which brands want to identify themselves with a antisemitic designer ?
Dior learned a valuable lesson. No matter how good you stated your image, how good you built up your brand DNA, 1 single event, quote, dialogue, news article,... can ruin everything in a second.
It is up to brands how to deal with this crisis situation. Dior did the best thing they could do. They immediately got rid of Galliano to save their own image. Another problem arises now for Dior? Who is going to be his successor?
Why? It is so important when you use celebrity endorsement that the celebrity matches the brand DNA and the brand values.
Jaeger Lecoultre's values are elegance, 'savoir faire' and precision.
Who denies that Diane is not elegant and does not look educated?
My opinion? Well chosen Jaeger! Congratulations!
Like every aspect of the brand, it has to match the general values and DNA. It's the same thing for the celebrity endorsement!
Now let's hope she don't use white powder like miss Kate Moss...
I just stumbled upon this latest news of Ducati Motorcycles and I think this fits the course perfectly.
Ducati Motorcycles has recently collaborated with Cigarette Powerboats, to make a race boat called the Racing 42x Ducati Edition. Not a pure brand extension, but it leans towards this module.
Why did Cigarette work together with Ducati?
Both brands have, according to me, similar identities and values but in different product categories.
The brands stands for racing, speed and fun. Some parts of the visualization of the brands, as seen in last class, are the same as well. The colors, for example, are black and red for both brands, representing speed, masculinity and passion.
Both pictures are screenshots of the brands. If one wouldn't know. you would say that this is the same brand.
With similar values, both brands attract similar target audience. (with a different income probably!?) Therefore, the collaboration is a perfect fit!
Looking forward on buying such a boat, in some years ;-)
Allright! Another monday, another blogpost about last week's Managing Luxury Brand Class.
This time, however, I don't have a lot to say. The reason being, is that our class stopped after an hour and half.
The first part of the class, we had to give presentations about a brand that we had to come up with. We just had to do some 'brand empathy', giving a character, an identity, a DNA (which I talked about before) to the brand. We had the possibility of doing:
1: Creating a new champagne, focussed on rich youngsters
2: A boutique range of hotels for wealthy singles (age 25-40)
3: A private jet service for celebrities and sports personalities
Our group consisted of myself and Costantijn, so 'the guys' went for the champagne.
The champagne we created was called Hedone. Constantijn made a bottle on his computer using photoshop but I haven't got it on mine, so when I get it from him (IF I get it from him) I will post it on this blog.
The emotions for our champagne were images that our used for HEDKANDI, but we figured out that these images fitted the brand excellent.
For HEDONE, it is all about young, sexy, fun and extravagant.
A good sentence to go with our brand would be:
'Enjoy yourself, others will too'
This is sort of in the line with what we do for our project for mr. Paget. So we have an idea on what our target audience wants.
The other groups came up with other ideas:
One group also did a champagne. They didn't name it but it was all about the color purple. The champagne would be (almost) exclusively a drink for women. It represents female elegancy.
The packing would be of high luxury and the face for the brand would be the Olson twins. This group felt like they would fit their brand perfectly.
Wonder what they would call it though...?
A private jet company!
Prestigious, classy, comfort, deluxe, stylish...
Everything a private jet needs, and more!
The Jet Setter Company, with a logo in black and silver, fitting in speed and motion into the logo.
Wish they could give me a percentage on one though...!
The V Hotel. (No, no, we didn't get our inspiration from the W hotel!)
However, the V made sense in their explication. This hotel would be very exclusive and would be located in Soho. The name 'V' comes from the exclusive partnership with Vertu, offering the same concierge-service.
The focus in the hotel would be on the design, because Philippe Starck would design every room himself.
The last group did a hotel as well. They made a powerpoint so I don't have any visuals on their project but I will describe it.
They created a hotel, called Rendez-Vous. This hotel would have the typical French Baroque style. Pillows, chandeliers, red everywhere, cosy, intimate,... everything you can imagine. Just a shame I haven't got the visual to show you.
These small projects were actually also the introduction to the (short) lecture. The lecture was about creating Multi-faceted multi sensory luxury brands. This technique exists of visualizing the brand DNA and personality.
For example: What color would the brand be, what car would it drive, which person should it be?
We already did this in our first semester with mr. Paget. Here is the brand matrix (and an example of visualizing) of a luxury brand. The brand itself was called Black Diamond Vodka.
We did have some experience in visualizing a brand.
The lecture ended with some advise every luxury brand manager should consider!
The laws of marketing do not apply on luxury brands! There are many differences.
- Luxury brands sell on emotions. Without a story or telling people something, it will fail.
- - Brands live in our dream. A lot of these brands we aspire to, until eventually one day, we can buy them
- - Own/desired identity: Luxury brands has to fit our own (or wanted)identity and has to match our own values
- - Uniqueness: If a brand cannot offer something else than the competitors, you are just one in a dozen.
- - Illogical customer loyalty: Some brands see the loyalty go up, if their prices go up. A luxury customer is not the same a 'normal' customer.
Finally found some time to write about my second class of Managing Luxury Brands. God, what a week!
But we got Monday off, so Monday is working day.
Anyway, second class was all about the packaging of luxury brands and a luxury brand's DNA. But we started off by presenting ourselves to the class, again!
'Hi my name is Vic. I'm from Belgium. I did a Ba in Business Administration, followed by a Master in Marketing. I'm doing this MA because I'm very interested in the area of luxury. My area of interest in the field of luxury are night/beach clubs, alcohol, cars, technology, watches, etc. Just not the fashion side to it. I hope to get to know the differences between the management of luxury brands and normal brands. I also want to get to have an insight on how luxury brands make people want your products, without needing them!'
Mrs Gossain made us do this presentation because she promised to take the course to us. She will ( at least she promised! No pressure ;-) ) involve some examples from the areas in which we are interested, to make the course more interactive, tangible and interesting. Looking forward to that!
After the presentations the class really kicked off. It started with two lessons one should remember when it comes to luxury brands:
- A luxury brand (the story around it, the name, the mystery,...) has a higher value than its tastable equity.
- Luxury brands have a reputation that has to be respected. ( Louis Vuitton, for example, never do sales on its products)
Brand DNA
What is a brand's DNA? We already saw this subject in the classes of mr. Paget. From that class we knew that a brand can be visualized by using archetypes, a brand matrix and stylistic position.
Now we used a slightly different approach to a brand's DNA.
What makes a brand?
- Brand's vision: It defines what the brand is, and where it wants to go. It helps define the future aspirations of the company
- Brand Essence: This is the brand's DNA. It defines the 'gut feel' of the brand.
- Brand Positioning: The space a brand should occupy in the minds of the consumers within the competitive arena.
- Brand Values: What the company tries to achieve, in terms of performance, values, innovation, etc.
But what is the brand DNA exactly according to our class?
Brand Conception (understanding who you are as a brand), Brand Image (brand differentiation), Creator of the brand, slogan, creating dreams, colors, craftsmanship, specific style of the brands, heritage...
We were going in a good direction!
The brand essence (DNA) is fueled by: emotions, celebrity endorsement, visual code, style/photography, name, senses and experience.
Emotions
From one extreme emotion.
To another.
Do you need any other examples of how emotions fuel a luxury brand's DNA? ( The emotions have to be in line with the values and positioning of the brand. Can you imagine Tiffany making a commercial like the AP one?)
Celebrity Endorsement
The celebrity a brand choose, has to fit the image of the brand. There is an extra danger using celebrities as endorsement for your brand.
You might remember these cases:
And now? Stick with them or drop them?
It is an important choice that your company has to make!
Visual Code
Because who doesn't recognize following logos:
Style/Photography
Every respected brand has a certain style that is being used throughout everything they use. From websites, to advertising and the pictures of advertising.
Take Lamborghini for example.
Lamborghini uses the same style throughout their communication. Shops are black and white, pictures are black and white, and the website is black and white. They use a very minimalistic visual style so that all the attention is drawn to the cars.
Name
There is a big difference in the approach of using names between luxury brands and normal brands.
Normal, mass-market brands use names that are short and easy to remember.
This approach doesn't work for luxury brands. The name is something that fuels the dreams, the aspiration of a luxury brand as well. It cannot be meaningless.
Most of the times, the name of a luxury brand is the name of its founder or creator.
Some examples:
A name feeds the myth, feeds the emotions, feeds the WANT towards a brand.
Senses+Experience
Luxury brands also uses the consumers senses to feel the brand. The best example for using senses are car manufacturers . Inviting potential customers for test drives to smell the leather, hold the steering wheel, hear the motor, experience the speed.
Packaging
Packaging is an important part of the luxury brand strategy. Why?
Our mutual class answers: Brand Image, reproduction of product quality, first image/touch of the brand, cheap advertisement platform, built up the excitement, adding collectibles, etc.
The packaging of luxury brands also have in common that it is of a higher quality than normal packaging and that it complements the brand.
For example: Louis Vuitton packaging exists of a couple of layers. First you have to bought product. This goes in a bag like the brown one on the picture. The bag goes in a hard cardboard box, that eventually goes into a high quality, hard paper board bag.
The big question about packaging remains: Which packaging is the most successful of them all?
Well, we cannot give an answer to this. Packaging have to be integrated in the communication style of the brand. It has to fit the image of the brand, the values.
Two major lessons can be learned after having this class:
- Whatever you choose to do as a brand, make sure everything fits and is complementary. Do everything in line with your objectives, values and brand DNA. There are no exceptions to this rule, or you might bring doubt to the customers.
- Use your brand DNA wisely to differentiate yourself from competitors. Without a clear brand personality, you might end up being forgotten.
Up to next class, for which we have to make a mood board for and non-existing champagne brand for young and rich kids.
