It may be to do with rarity
Why do wear the best suit (dress) when going for an important meeting or interview? Why do we make sure that we do not use a cheap perfume when going on a date? The aspect of self-indulgence is intertwined with the socially directed motives when it comes to luxury. The concept of luxury has been present in various forms since the beginning of civilization. Its role was Just as important in ancient western and eastern empires as it is in modern societies. With the clear differences between social classes in earlier civilizations, the consumption of luxury was limited to the lite classes.
It also meant the definition of luxury was fairly clear. Whatever the poor cannot have and the elite can was identified as luxury. The meaning of luxury and the sorts of customers that buy luxury have continually been evolving, but never as dramatically as in the past 20 years. With more potential customers , the luxury sector is today healthier than ever – increasing at around three times the rate of worldwide wealth. The luxury goods industry is unique in that it is an industry that relies strictly on marketing and promotion to sell products to a specified group of people.
It is also an uxury goods industry is very fascinating and the products themselves signify prestige and status. Although a select few are able to afford luxury goods, the vast majority of people who are exposed to advertisements for certain products generally have aspirations of being able to own these products someday. The theme of this course paper is really topical nowadays, because each luxury brand takes care about its image, performance, and service in order to attract more and more customers and to gain customers loyalty.
The success of each company depends mostly on clients, so to develop the business successfully each company has o care a lot about marketing aspects and to use various marketing methods of attracting new customers. The purpose of this course paper is to explore which methods of winning customers attention are more effective. Accordingly, the main objective is to study the major methods of attracting clients on the examples of the leading luxury fashion companies and to analyze their sales volume. The course paper is divided into two parts.
The first part is called “Fashion industry and the place of marketing in it” and it tells about what is called luxury in general, about the global market of luxury goods and methods of attracting more and more ustomers. The second part of the course paper is called “The analysis of marketing methods of major luxury fashion brands”, where the analysis of the major luxury brands has been made – Burberry group, Gucci group and LVMH, including the statistics, the methods of customer attraction, some key steps to success of each. . Fashion industry and the place of marketing in it 1. 1 . Getting to know luxury Although the term “luxury products” is broadly defined and therefore basically comprehensible, it still needs to be operationalized because it is not yet clear which products are actually “more than necessary and ordinary compared to the other roducts of their category. ” The broad definition of luxury products can be modified and further specified by an operational definition.
For this purpose, adequate indicators for a term need to be determined. According to the dimensional analysis, it was decided to operationalize luxury products by their characteristics. The operationalization relies on a literature analysis and an empirical study. The results suggest that consumers perceive that luxury products have six major characteristics including price, quality, aesthetics, rarity, extraordinariness and symbolism.
In that ay, the operationalization helps to decide for most products if they are part of what is meant by the term “luxury product”. The definition of luxury products can be summarized as: Luxury products have more than necessary and ordinary characteristics compared to other products of their category, which include their relatively high level of price, quality, aesthetics, rarity, extraordinariness, and competences of creativity, exclusivity, craftsmanship, precision, high quality, innovation and premium pricing.
These product attributes give the consumers the satisfaction of not only owning expensive items but the extra-added psychological enefits like esteem, prestige and a sense of a high status that reminds them and others that they belong to an exclusive group of only a select few, who can afford these pricey items. The luxury sector targets its products and services at consumers on the top-end of the wealth spectrum. These self-selected elite is more or less price insensitive and choose to spend their time and money on objects that are plainly opulence rather than necessities.
For these reasons, luxury and prestige brands have for centuries commanded an unwavering and often illogical customer loyalty. Luxury as never been something easy to define, yet this mystery concept is something highly desired by one and all alike. Delving deeper into this mystery and aura of luxury goods by way of comparing them against ‘regular goods’ as well as highlighting the characteristics of the luxury industry. Luxury products and brands can be distinguished from the premium segment by their constitutive characteristics.
The major characteristics can be considered as dimensions ranging from a minimum level that is also necessary for non-luxury brands to a maximum level that corresponds to the highest form of luxury. As demonstrated in the table below, premium brands rate higher on these dimensions than medium-level brands, but still well below luxury brands. While premium brands still remain down-to-earth and cannot lose sight of the value-for-money ratio, luxury brands are reaching exceedingly reasonable levels in the major luxury dimensions, and some of them even work on topping the current top-of-top luxury level.