Brand management in the luxury industry

By Prof. Robert Somogyi

Once upon a time, there was a luxury fashion brand that had been around for decades. Despite its long history and reputation for quality and craftsmanship, the brand struggled to stay relevant in the fast-paced and ever-changing fashion industry. Its sales were declining, and younger consumers seemed uninterested in its products.

The brand knew it needed to revitalize its image and appeal to a new generation of customers, while still staying true to its core values and heritage. It embarked on a comprehensive brand management strategy that focused on three key areas: product, communication, and experience. 

First, the brand revamped its product offerings, introducing new designs that blended traditional craftsmanship with contemporary aesthetics. It also partnered with up-and-coming designers to create limited-edition collections that appealed to younger, trend-conscious customers.

Next, the brand developed a new communication strategy that emphasized its unique history and craftsmanship, but also highlighted its relevance to modern consumers. It launched a social media campaign that showcased its products in real-life situations, rather than in staged fashion shoots. It also collaborated with influencers and bloggers to reach new audiences and generate buzz.

Finally, the brand invested in enhancing the customer experience by opening new flagship stores that were designed to create a luxurious and immersive shopping experience. It also introduced personalized services, such as made-to-measure suits and personalized monogramming, that catered to the individual tastes and preferences of its customers.

As a result of its brand management strategy, the brand was able to successfully rejuvenate its image and attract a new generation of customers while maintaining its traditional customer base. Its sales and profits increased, and it once again became a highly desirable and prestigious luxury fashion brand.

So what is brand management for and how does it work?

Brand management in the luxury industry requires a unique approach because the industry is characterized by high-end products that are often associated with exclusivity, prestige, and heritage. Luxury brands typically have a long and storied history, and they are known for their superior quality, craftsmanship, and attention to detail.The following are some of the key aspects of brand management in the luxury industry:

1. Product development: Luxury brands invest heavily in product development to create high-quality and exclusive products that differentiate them from competitors. They also focus on creating limited-edition and customized products to appeal to the discerning tastes of their target customers.
2. Brand identity: Luxury brands typically have a distinctive brand identity that reflects their heritage, values, and positioning. They use high-end materials, packaging, and design elements to create a sense of luxury and exclusivity.
3. Communication: Luxury brands use various channels to communicate their brand identity and message to their target audience. They use advertising, public relations, social media, and events to showcase their products and connect with customers.
4. Retail experience: Luxury brands create unique and immersive retail experiences that align with their brand identity and reinforce their positioning. They use store design, visual merchandising, and customer service to create a luxurious and personalized shopping experience for their customers.
5. Exclusivity: Luxury brands often use exclusivity as a key element of their brand strategy. They limit the availability of their products and create special events and collaborations to maintain a sense of exclusivity and desirability.

In summary, brand management in the luxury industry requires a highly strategic and targeted approach that focuses on creating exclusive and high-quality products, building a unique brand identity, communicating effectively with target customers, creating a luxurious and personalized retail experience, and maintaining a sense of exclusivity and desirability.

The model of Brand management

There are several models of brand management, but one widely recognized model is the Keller's Brand Equity model. This model was developed by marketing professor Kevin Keller and is based on the premise that building a strong brand requires creating positive brand associations and perceptions among consumers. The Keller's Brand Equity model consists of four key components:

1. Brand Identity: This component refers to the visual and verbal elements of the brand, including the brand name, logo, slogan, and packaging. It is the foundation of the brand and establishes the brand's unique identity in the minds of consumers.
2. Brand Meaning: This component refers to the brand's associations, including its attributes, benefits, values, and personality. These associations help consumers understand what the brand stands for and what it represents.
3. Brand Response: This component refers to how consumers respond to the brand, including their attitudes, beliefs, and emotions. Positive brand responses can lead to loyalty, repeat purchases, and positive word-of-mouth recommendations.
4. Brand Resonance: This component refers to the ultimate goal of brand management, which is to create a strong, enduring relationship between the brand and its customers. This can be achieved through creating a sense of community, loyalty, and engagement among customers.

Overall, the Keller's Brand Equity model emphasizes the importance of creating a strong and unique brand identity, developing positive brand associations and perceptions among consumers, and building a strong emotional connection with customers to create long-term brand loyalty and success.

The Brand Equity model can be applied to a luxury brand to create and maintain a strong brand equity. Let's take the example of a luxury fashion brand to explain each component of the model:

1. Brand Identity: In the case of a luxury fashion brand, the brand identity would include elements such as the brand name, logo, packaging, and store design. These elements should convey the brand's unique heritage, craftsmanship, and attention to detail, and create a sense of luxury and exclusivity. For example, a luxury fashion brand might use high-quality materials, intricate designs, and elegant packaging to convey a sense of luxury and craftsmanship.
2. Brand Meaning: The brand meaning for a luxury fashion brand would include its attributes, benefits, values, and personality. Luxury fashion brands typically focus on attributes such as exclusivity, quality, and craftsmanship, and benefits such as status and prestige. The brand values may include a commitment to sustainability and ethical production practices. The personality of the brand may be refined, sophisticated, and elegant. A luxury fashion brand might communicate its meaning through its advertising, social media campaigns, and store design.
3. Brand Response: The brand response refers to how consumers respond to the brand, including their attitudes, beliefs, and emotions. For a luxury fashion brand, positive brand responses can lead to loyalty, repeat purchases, and positive word-of-mouth recommendations. Luxury fashion brands might create positive brand responses by offering personalized service, unique products, and exclusive experiences. For example, a luxury fashion brand might offer made-to-measure clothing, customized monogramming, and VIP events for its most loyal customers.
4. Brand Resonance: The ultimate goal of brand management is to create brand resonance, which is a strong, enduring relationship between the brand and its customers. For a luxury fashion brand, this might be achieved by creating a sense of community and engagement among customers. Luxury fashion brands might achieve brand resonance by hosting exclusive events, collaborating with other luxury brands or designers, and creating limited-edition products that appeal to their most dedicated customers.

What are the key components of Brand management?

Brand management is the process of planning, developing, and maintaining a brand in order to enhance its perceived value and ensure its long-term success. It involves creating a unique brand identity that distinguishes a company or product from its competitors and building a strong, positive brand image in the minds of customers.

Effective brand management involves several key components, including:

1. Brand strategy: Developing a clear and compelling brand vision, mission, and values that guide all brand-related activities.
2. Brand positioning: Identifying the target audience and creating a unique and relevant brand positioning that resonates with them.
3. Brand identity: Developing a distinctive visual and verbal brand identity that reflects the brand's personality and values.
4. Brand messaging: Creating consistent and compelling brand messaging across all channels and touchpoints.
5. Brand experience: Ensuring that every interaction with the brand creates a positive and memorable experience for the customer.
6. Brand measurement: Measuring and analyzing the brand's performance and impact on customer perceptions and behaviors.

Effective brand management is essential for building customer loyalty, increasing brand equity, and driving business growth. It requires a strategic and holistic approach that integrates marketing, design, communication, and customer experience to create a powerful and enduring brand.

LIST OF BRANDS

It's worth noting that this list is not exhaustive and there are many other high-end brands that are also highly regarded. The ranking of luxury brands can vary depending on different factors.