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Luxury Brand Development, Management and
Internationalisation
Dr. Satyendra SinghProfessor, Marketing and International Business
University of Winnipeg, [email protected]
www.uwinnipeg.ca/~ssingh5
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The Concept of Brand Development:Add value first
Then, we’ll do positioning, pricing, branding and communication around the value proposition.
Commodity Goods Service Experience 1₡-2₡ 5₡-25₡ 75₡-$1.5 $2-$2.50
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Sources (messages) of value to the brands
• Mercedes Engineering, sophistication and safety• MBW engineering and driving• Nike Performance• Starbuck Best coffee experience• FedEx Overnight• Harvard Leadership skills• MIT engineering and management• 3M Innovation• Luxury Dream!! Which dream? You can brand anything e.g. water, yourself…
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Lamborghini bicycle:$25,000 -- Lightest
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Franck Muller:Master of Complications
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24 Complications
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Celestial map, do we need it?
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900 parts in luxury versus 90 in ordinary, or 0 in electronic watch
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Black Credit Card
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The Luxury: The Dream Club
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The Luxury: The Desire
You pay $5000
Limousine ride, hovering photographers
red carpet, 4 hysterical fans… Can you imagine?
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Characteristics of Luxury BrandDream a dream with value
Create exclusive club
Functional GivenExchange Last long, can outlive youEmotional You adore it, source of joyMythical There is something about itEthical Links to social responsibilityIdentity Convey something about you
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Brand Content
To sustain brand imageTo be the leader, set trends↑ functional and emotional value
How do we do itEducate customers History and heritageInterviews, fashion shows, manufacturing process Link brand to communityShow social responsibilityGucci (mrf process), Chloé (fashion show) www
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Brand Identity
Levis Jeans with distinctive labels
Missoni Knitted fabric in a special way
Toblerone Chocolate, red/yellow packaging
Tod’s Moccasins (shoes made from deerskinvery soft, single piece of leather
Ferrari Red automobile
LOGOS play important role in forming brand identity
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Luxury Brand and Social Responsibility
Nike Just do it Surpass your determination
Mont Blanc UNICEF
$10,000 for a dinner ticket
Rich compete to donate!
Singer Bono’s brand in Africa
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Louis Vuitton Foundation: Contemporary art museum
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Luxury Customization – Rich like itProduct
LV : choose colour and materialPoint of delivery
Bring receipt to customer, engrave their nameShopping experience
Assistance to old people, spl invitation, discountCustomization online Online interaction
Shop with a friend live video chat assistance Sales $20m $60m
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Online Product Display50% of luxury brands are online now
Virtual mannequins 360 degree pictures
iSmell software You can smell the product on your computer
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10Cs of Luxury Fashion Online Marketing
Customer value Satisfaction
Convenience
Cost
Communications Faster and targeted
Computing Able to track online
Customer franchise Trust, live assistance
Customer care
Community Social network
Content
Customization
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Luxury Logos Simple
Japanese like logos more space for logos
Europeans do not like logos on tie; US ok
Icon apple
Indices relationship (smoke means fire)
Symbols Ambiguous (Lion on Venice flag)
Numbers, animals, initials, monograms,…
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Luxury Brand HingeNorth European Classical type
Clear lines, contours, saturated colours, closed… shape, entirely visible
Jil Slander, Ikea, Helmut Lang, BMW
USA Calvin Klein, Donna Karan
Mediterranean Brands baroque typeCriss-cross, open, exaggeration, line shadows…
Loewe, Ferragamo, Doice and Gabbana, Rubell, Majorica, Lamborghini, Versace, Ronerto Cavelli
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Internationalisation: Luxury Brand① Create brands visibility awareness,
Expand product line, men women
② License abroad 1st perfume then fashion
↑ advt for perfume ↑ brand awareness
③ Open flagship stores in big cities abroad.
Balance Merchandise bw COS & franchisee
④ Buy back franchisee. Get new balance.
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Internationalisation by Brands
LV USA, Germany, Italy, Spain
Burberry, Prada China
Audi China: Chinese officials, made-in-China
Hermés Shang Xia
…
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International Luxury Brand Management
Brand development
Initially one product line extensive variety and colour
Brand registration
Register brand in few countries first
$2,000 - $3,000 per brand (lawyer fee, tax…)
If target 100 countries $200,000 - $300,000)
Registration renewal
Show proof of usages, or counterfeit operator
Usually 20%-30% brands need renewals
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Brands Become International When
$50m sales are reached
50% of public knows the logo
New category is developed successfully
No longer advertisement is needed to sell
Brand outlives investor eg, 3rd generation
Brand is present in USA, Europe and Asia