Is luxury history ? / by heathrowkennedy

On Thursday I was privileged to be invited by Imagination in London to attend their seminar "Is Luxury History ?" - once I got over the potentially alarming implications of this being answered in the affirmative - it is, after all, my chosen sector - I prepared myself for an enjoyable few hours above the rooftops of London listening to what promised to be an exceptional line-up.   I was not disappointed. Three speakers stood out for me.   Two I'm familiar with - James Lawson from Ledbury Research and Professor Jean-Noel Kapferer from HEC Paris and the Pernod Ricard Chair on Prestige & Luxury Management.  The other was a surprise and a thought-provoking one at that, Ross Klein the Head of Strategy for Imagination, The Americas.

The afternoon moved from the rigour of data and trend served up with aplomb and diligence by Lawson and onto the strategic framework of luxury management itself delivered in the usual captivating style of Jean-Noel before we were treated to the indulgence of luxury retail in all formats by Klein.    It was an engaging narrative arc and one which required much mulling over afterwards which I did in the reassuring old-school luxury environment (ties mandatory and the use of mobile devices forbidden) of Mark's Club in Mayfair thereafter.

So here are the items which stuck in my mind;

  • "Premium is comparative.   Fashion is imitation.  Luxury is superlative."   In nine words Jean-Noel provides the guidance that every luxury marketer should recite as a mantra every single day.   This is all anchored in his view (that I certainly share) that "luxury is  a religious belief system".  When a marketer starts to invite comparison of performance or, even worse, the customer does it is a slippery slope for the brand in question.
  • "Advertising does not sell, it builds the dream."   Another Jean-Noel pearl.   I would go a step further and say that whenever a luxury brand places the product front and centre it has wasted every media dollar spent.   If it has such insecurity about the need to show a product in this way it probably should not be advertising.  Think brand not product.
  • "Increase the average price of your range and don't chase volume."    This one is etched on my heart.   All too often marketers forget that the most formidable weapon they have in their armoury is price.   In a cluttered category it is the escape mechanism (as long as you have lots of brand equity).   I recently re-read a strategy paper I had written whilst managing The Macallan Single Malt Whisky in the USA "Managing for Value & Volume".   Eight years on I would not change a word of that strategy.
  • "The rise of FMCG Managers and the end of familism".   This is the last Jean-Noel observation I had noted down (there were dozens more) and it concerns the entry into luxury companies of the more technocratic FMCG manager.  An important addition in key areas as the luxury business expands but he introduced the essential activity of "unlearning".   In other words that incoming manager had to adapt quickly to the luxury context.  Fascinating and worth a more detailed blog in the future.

Ross Klein's presentation was one of those where 'you had to be there'.   It was a tour de force as he raced us around the globe from bijou boutique to super mall.  From Downtown Dallas to Skyscraper Dubai, he focused strongly on the rituals around retail and this chimed  perfectly with Jean-Noel's religious parallels.

Klein held a mirror up to us as he stressed the fine-line between volume and awareness driving activities and the need to preserve exclusivity.   He cited a perfect example of the superficially very clever cross-marketing project between Target and Neiman Marcus with holiday time pop-ups in each other's stores.    It does not take a genius to work out that one benefited more than the other !   The Neiman Marcus team obvious forgot the unwritten rule - only ever pool your brand's equity with an equal or greater brand !

So what was the conclusion ?  Well luxury is very much alive but brands require careful nourishment - it's never a foregone conclusion that every brand will survive.

As for Imagination they did a good job presenting their own brand in a luxurious way.