A luxury brand is a brand of which a majority of its products are luxury goods associated with luxury, high price, and high quality. Another market characteristic of luxury goods is their very high sensitivity to economic upturns and downturns, with high profit margins, and very tightly controlled brands.
With the development of technology, social media marketing is becoming an increasing important part of brand creation and maintenance process. Luxury brands are definitely keeping up with the Joneses when it comes to recognize the importance of a strong, online identity and integrate social media into their marketing mix. More and more luxury brands turn to the Internet and technology to build brand through social media for growth and profits.
Social media channels offer the chance to create instant connections with consumers. Luxury brands are combining streaming video, blog & chat room technology to offer customers exclusive access to content in a way that is most relevant & natural for them, through their established online social network. By creating online personas through established social media channels like Twitter & Facebook, luxury brands are giving consumers quick and easy access to the brand and an opportunity to experience the brand personality first hand. Consumers are increasingly sharing their thoughts and experiences within their own social network, which has a great impact on perception among peer groups. Consumers’ discovering new products through their own peer communities online reflect on the relevance of brands and product purchases through social media. The value of peer to peer recommendation in the purchase decision process is well known and well documented!
According to a survey in 2010, Wealthy Individuals Use Social Media More Than Most Americans (http://www.seic.com/enUS/about/4206.htm), conducted by SEI Wealth Network, "70 percent of high-net-worth individuals (with more than $5 million in invested assets) use Facebook and other social media sites."
How to draw the wealthy customers' attraction to luxury brands through social media is a great challenge!
I am thinking whether these luxury brands can emulate the iPhone/iPad application of Starbucks eXpresso Lite, which let these wealthy individuals opt for their desired goods online when they use Facebook and iPhone/iPad applications.
Really interesting statistics! Most Americans is kind of broad though... Especially because there are so many people, it's a shame that they didn't include figures in the article.
ReplyDeleteLuxury brands and social media is a challenge. Most luxury brands are a afraid of cheapening their brand through social media. The difficulty is to get more customers and how to get them through social media. The ones who already buy these brands are aware of them and buy it without social media presence.
Some luxury clothing brands have a solid following on FB so that could be an effective platform, especially if wealthy people use social media a lot.
YEah, I see this as quite a difficult topic. In all other areas of marketing luxury brands are the brands that really don't advertise massively, they tend to stick to the exclusive stuff such as sponsorship of high stakes race in the Spring Racing carnival (BMW) or F1 (Tag Heuer). I agree with @RoniJ that these brand are possibly afraid because they don't want cheapen their brand. But I disagree with this idea. Joining SM will not cheapen your brand! You need to do it right for your type of brand. Perhaps use SM sites that offer exclusive invites etc etc.
ReplyDeleteRoss
An interesting topic - thanks for discussing it, Stephy.
ReplyDeleteAs Roni and Ross suggest, connecting your luxury brand with a SM platform such as Facebook may lead to a perceived "cheapening" effect. I wonder if these brands should instead look at creating their own "private label" networks? The luxury brand values are all about being "exclusive" so, as @Ross suggests, keep the SM exclusive too.