Running Head: Experiential Marketing and Luxury Champagne

Exposé

The impact of experiential marketing on customers’ brand perception in the champagne industry: a cross cultural analysis and

an attempt to propose an innovative concept

Laëtitia Lefèvre

31/10/2012

European Master in Business Studies

Fachbereich Wirtschaftswissenschaften

DMCC – Dialog Marketing Competence Center

Mönchebergstraße 1 , D–34125 Kassel

SVI-Stiftungslehrstuhl für

Internationales Direktmarketing

Prof. Dr. Ralf Wagner

1

Content

1 Title ................................................................................................................ 2

2 Abstract .......................................................................................................... 2

3 Introduction/Background ............................................................................... 2

4 Problem statement .......................................................................................... 3

5 Research purpose ........................................................................................... 4

6 Hypotheses ..................................................................................................... 4

7 Review of Literature ...................................................................................... 5

7.1 Experience economy: generalities and application to luxury ................. 5

7.2 Understanding luxury products and brands: general elements ............... 7

7.3 Luxury perception: overview of various measurement approaches ....... 8

7.4 Wine and Champagne marketing: general elements ............................ 11

7.5 Cross cultural context in consumer behavior........................................ 13

7.6 Concept testing ..................................................................................... 13

8 Methodology ................................................................................................ 14

8.1 Theoretical approach ............................................................................ 14

8.2 Secondary data ...................................................................................... 15

8.3 Empirical approach ............................................................................... 16

9 Overview of Chapters: ................................................................................. 18

11 Appendix - Proposition for the brand selection ........................................... 23

12 Bibliography ................................................................................................ 23

2

1 Title

The impact of the experiential marketing on customers’ brand perception in the

Champagne industry: a cross cultural analysis and an attempt to propose an

innovative concept.

2 Abstract

Nowadays, Champagne Houses have to face a delicate challenge. They have to be

innovative in order to differentiate themselves and acquire notoriety, but at the time,

there is a need to respect the traditions acquired with centuries of history. One of the

possible solutions applied by Champagne brands is to provide consumers with

unique experiences. Experiential marketing is the focus of several studies in the

consumer behavior field both for mass consumption goods and services. Even if

some research already investigated the use of experience in the luxury sector, a gap

of knowledge is remaining, especially for Champagne.

This research, therefore, aims to explore the impact of experiential marketing

strategies used by champagne brands on their consumers’ brand perception. This

exploratory study will offer a comparison between an emerging market, Russia, a

particular market for champagne which is the French market, and a stable developed

luxury market, the United Kingdom.

To conduct the research, the methodology used is a combination of a theoretical

approach, an exploration of secondary data from champagne houses, and an

empirical approach consisting in an online questionnaire for France, UK and

Russian.

An additional objective is to develop an innovative experiential concept.

Keywords: experiential marketing, luxury, champagne, perception, cross-

cultural, concept development

3 Introduction/Background

The uniqueness of the champagne is the result of several centuries of experience

and know-how that had associated this particular product with historical authenticity

and high-quality. Le terroir (the land), la méthode champenoise (method from the

champagne area) and l’Appellation d’Origine Contrôlée (controlled designation of

3

origin) constitute the distinctive competences of Champagne and are part of its

success on the international wine market (Sharp & Smith, 1991). The economic

environment of the champagne market is changing, particularly since the growth of

emerging markets such as Brazil, Russia, India and China, and thus Champagne

brands are now facing new challenges in term of marketing strategy. They are aiming

at preserving the brand equity acquired with the history, and simultaneously to

increase the brand visibility by an image modernization. The respect of tradition and

the necessity of being innovative seem to form the paradox of the marketing strategy

of Champagne brands.

The strength of champagne brands lies in their Sustainable Competitive

Advantages which are a mix of signals provided to consumers to help them

distinguish their products from the ones competitors offer (Fahey, 1986). The

necessity to demonstrate the supremacy of product quality arises from the

insufficient knowledge of consumers or their inadequate understanding of

Champagne quality (Gergaud & Vignes, 2000). The position of Champagne is

difficult as it is a luxury product that is not always consumed in a luxurious

environment.

4 Problem statement

In today’s marketing debate, the possibility to increase consumers’ satisfaction by

providing a product or brand experience is becoming largely accepted by researchers.

Experiential marketing has been the focus of several studies and it appears as one of

the cornerstone of contemporary marketing for mass consumption goods and

services. Luxury goods category is seen as a case apart because the experiential

dimension is both intrinsic and extrinsic. However, there are some opportunities for

Champagne Houses if the experience is exploited. Several instruments have been

designed to conceptualize the experiential marketing and give a support to managers.

Pine & Gilmore’s framework includes four dimensions (4Es) which are the

entertainment, education, aesthetic and escapist. The execution of the 4Es is

strengthening the customer experience and it takes into consideration the level of

involvement of the consumers as well as his absorption or immersion. The

entertainment dimension occurs when the customers have a passive participation in

an event and refers to sensing. The education dimension requires an active

participation from the customers who will acquire or increase his knowledge and

4

skills by learning. The aesthetic dimension is described as the passive immersion of

the customers in the experience; it is about being. Finally in the escapist dimension,

customers seek to participate actively in the experience by doing.

However, there is a gap of research on the influence of experiential marketing on

consumer’s brand perception, especially for a luxury brand such as Champagne.

Moreover, various studies showed the importance of cultural influence on consumer

behavior and its implication on branding and the marketing strategy. Many authors

claimed the necessity of further empirical testing with regards to the development

stage of the luxury market. The observation made is that emerging markets such as

Brazil, Russia, India and China are showing dramatic changes in the field of

consumer behavior and it is crucial to compare it with developed markets.

Taking the previous elements into account, researching the experiential

marketing strategies applied by Champagne Houses and its impact on consumers’

perception in a cross-cultural context is even more relevant, as well as complex.

5 Research purpose

This research, therefore, aims to explore the impact of experiential marketing

strategies used by champagne brands on their consumers’ perception of Champagne

brands. Special attention will be given to the evolution of marketing strategies over

time, the growing importance of the experiential dimension defined by Pine &

Gilmore and the influence it has on consumers’ perception. This exploratory study

will offer a comparison between an emerging market (Russia), a particular market for

champagne which is the French market, and a stable developed luxury market, the

United Kingdom.

An additional objective is to develop an innovative experiential concept and to

test consumers’ perception of it in order to know if this concept could be exploited

by a champagne brand.

6 Hypotheses

- H1: The use of marketing actions belonging to the educational dimension

of Pine & Gilmore does influence consumers’ perception of champagne

brands.

5

- H2: The use of marketing actions belonging to the escapism dimension of

Pine & Gilmore does influence consumers’ perception of champagne

brands.

- H3: The use of marketing actions belonging to the aesthetic dimension of

Pine & Gilmore does influence consumers’ perception of champagne

brands.

- H4: The use of marketing actions belonging to the entertainment

dimension of Pine & Gilmore does influence consumers’ perception of

champagne brands.

- H5: Experiential marketing using 4Es do have a positive impact on

consumers’ perception of champagne brands.

- H6: There are differences between consumers’ perception from UK,

France and Russia due to cultural background.

7 Review of Literature

7.1 Experience economy: generalities and application to luxury

Title Author(s) Journal Content

The Experiential

Aspects of

Consumption:

Consumer

Fantasies,

Feelings and Fun

Hirschman,

Elizabeth

C.; Holbrook,

Morris B

Journal of

Consumer

Research, 9

(1982), 132-140

Hedonic consumption.

Fantasies, feelings and fun.

Experiential perspective.

Welcome to the

experience

economy

Hill, R., Pine

II, B., Gilmore,

J. H., Betts, P.

J., Houmann,

L., &

Stubblefield,

A.

Health Forum

Journal, 44(5), 10.

(2001)

Experience is added value.

Four economic stages

(Commodities, industrial goods,

services, experiences).

Experience has two dimensions:

involvement and connection level.

Four realm of experience:

entertainment, education, aesthetic,

escapist.

Experiential

Marketing

Schmitt, Bernd Journal of

Marketing

Management,

Vol. 15 Issue 1-3,

Contrast between traditional

marketing and experiential

marketing.

5 Strategic Experiential Modules:

6

(Jan-Apr1999)

p53-67

Sense, Feel, Think, Act, Relate.

Experience providers:

communication, visual and verbal

identity, product presence, co-

branding, spatial environments,

electronic media, people.

Luxury brand

marketing – The

experience is

everything!

Atwal, G., &

Williams, A.

Journal of Brand

Management,

16(5-6) (2009),

338–346

Massification luxury market raises

new challenges.

Experiential marketing source of

opportunity if innovativeness.

Luxury goods are intrinsically

experiential.

Pine & Gilmore framework adapted

to luxury.

Product

Experience Is

Seductive

Hoch, S. J.

Journal of

Consumer

Research, 29

(2002), 448–454.

Ambiguity can result from

experiences.

Experience catch consumer

attention and make him vulnerable.

Product experience influences

interpretation, serving personal

interests.

Product experience and own

seduction.

Endogenous nature of experience

allows consumers to adapt personal

taste.

Goal-oriented

Experiences and

the Development

of Knowledge

Huffman, C., &

Houston, M. J.

Journal of

Consumer

Research,

20(1993), 190–

207

Consumer memory improves when

information are learned through

experience.

Brand

Experience: What

Is It? How Is It

Measured? Does

It Affect Loyalty?

Brakus, J. J.,

Schmitt, B. H.,

&

Zarantonello,

L.

Journal of

Marketing, 73(3)

(2009), 52–68

Scale to measure brand

experiences.

Four dimensions measured:

sensory, affective, behavioral,

intellectual.

Positive correlation between brands

experience and customer

satisfaction and loyalty.

Increase of satisfaction with the

7

brand experiences (pleasurable

outcomes) lead to willingness from

consumers to repeat these

experiences.

L’expérience de

consommation, la

mise en récit de

soi et la

construction

identitaire: le cas

du trekking

Ladwein, R.

Revue

Management &

Avenir, 5 (2005)

105–118.

Create a narrative to enhance the

importance of the self in the

consumption experience (added

value).

Being the center of his own

experience encourages consumers

memory.

The relevance of studying the consumer behavior in order to explain and

predict consumer purchasing behavior has been largely accepted in the past years.

The consumer behavior science is defined as the “processes involved when

individuals or groups select, purchase, use or dispose of products, services, ideas or

experiences to satisfy needs and desires” (Solomon, Bamossy, Askegaard, & Hogg,

2006). This marketing field recognized in the early eighties that the affective

dimension is supplementing the cognitive dimension in order to explain human

behavior. In addition of being rational, consumers are also driven by their emotions.

The consumption is then seen as a hedonic pursuit of pleasure (Holbrook &

Hirschman, 1982).

7.2 Understanding luxury products and brands: general elements

Title Author(s) Journal Content

An international

perspective on

luxury brand and

country-of-origin

effect

Aiello, G.,

Donvito, R.,

Godey, B.,

Pederzoli, D.,

Wiedmann,

K.-P.,

Hennigs, N.,

Siebels, A., et

al.

Journal of Brand

Management,

16(5-6) (2009),

323–337

COO is mostly known for luxury

goods.

Brands and design are the most

important elements influencing

consumer perception.

COO not relevant in luxury goods

perception.

Higher level of involvement leads to

lower importance of COO.

The specificity of

luxury

management:

Turning

Kapferer, J.-

N., & Bastien,

V.

Journal of Brand

Management,

16(5-6) (2009),

311–322

Traditional marketing irrelevant.

Recreate the social distance.

Luxury for others (social function).

8

marketing upside

down

Luxury for oneself (personal &

hedonistic, multi-sensory &

experiential).

Luxury and fashion (timelessness).

Unique, superlative, not comparable

with competitors, emotional

involvement with storytelling.

Product of excellence, authenticity.

Aesthetics and

ephemerality:

observing and

preserving the

luxury brand

Parent, M.,

Berthon, J.,

Pitt, L., &

Berthon, P.

California

Management

Review, 52(1)

(2009), 45–66.

Conceptualization of luxury:

functional, experiential, and

symbolic.

Typology of luxury brands: modern

(conspicuous possession), classic

(aesthetic possession), postmodern

(conspicuous consumption), wabi

sabi (aesthetic consumption).

Growing importance of experiential

dimension but important to keep a

balance between with functional and

symbolic dimensions.

Crafting Brand

Authenticity :

The Case of

Luxury Wines

Beverland, M.

B.

Journal of

Management

Studies (2005)

Strategies to build authenticity:

Protect brand status.

Use of classification systems.

Commitment to historical quality and

price performance.

Sincere story.

Place as a referent (terroir).

Traditional production methods.

Stylistic consistency (continuity).

Culture and history.

7.3 Luxury perception: overview of various measurement approaches

Title Author(s) Journal Content

An international

perspective on

luxury brand

and country-of-

origin effect

Aiello, G.,

Donvito, R.,

Godey, B.,

Pederzoli, D.,

Wiedmann, K.-

P., Hennigs, N.,

Journal of Brand

Management,

16(5-6) (2009),

323–337

COO is most always known for

luxury goods.

Brands and design are the most

important elements influencing

consumer perception.

COO not relevant in luxury goods

9

Siebels, A., et

al.

perception.

Higher level of involvement leads to

lower importance of COO.

Comparing the

importance of

luxury value

perceptions in

cross-national

contexts

Shukla, P.,

Purani, K.

Journal of

Business

Research, 65(10)

(2012), 1417–

1424

Different perception of luxury

between indian and british due to

cultural differences (important

factor).

Overall perception of luxury

influence luxury purchase decision.

Experiential/hedonic value

dimension is non-significant in both

countries.

Massification of luxury responsible

for a decrease of psychological

meaning of luxury consumption.

Measuring

perceived brand

luxury: An

evaluation of the

BLI scale

Christodoulides,

G.,

Michaelidou,

N., & Li, C. H.

Journal of Brand

Management,

16(5-6) (2009),

395–405

Psychometric properties of Vigneron

and Johnson’s Brand Luxury Index

(BLI).

5 perceived values that differentiate

luxury and non-luxury brands:

perceived conspicuousness,

perceived uniqueness, perceived

quality, perceived hedonism,

perceived extended self.

BLI scale is globally reliable but

needs to be readapted for

conspicuousness and hedonism

perception measurement.

Luxury brands attributes perceived

differently in a cross-cultural

context.

Effect of

experiential

value on

customer

satisfaction with

service

encounters in

luxury-hotel

restaurants

Wu, C. H.-J., &

Liang, R.-D

International

Journal of

Hospitality

Management,

28(4) (2009),

586–593

Creating high quality service

encounters enhance customer

satisfaction, and thus leads to

repurchasing behavior (Gupta et al.,

2007; Heskett et al., 2004).

Experiential value directly and

positively affects customer

satisfaction.

High quality service, positive

10

atmosphere and entertaining

experience lead to customer

satisfaction.

Importance of: environment, staff

performance, customer interaction.

Does experiential

marketing affect

the behavior of

luxury goods’

consumers ?

Snakers, E.,

Zajdman, E., &

Bengtsson, M.

Students Umeå

School of

Business Spring

Summer 2010

Master thesis

Experiential marketing increases the

level of emotions of luxury goods

customers, independently from their

initial sensibility level.

Low purchase intensions result from

low emotions.

Experiential marketing increases

emotions and can change the

hierarchy of effects of cognitive

people as well as their attitude, and

reinforces it for affective people.

Impact of

interpersonal

influences, brand

origin and brand

image on luxury

purchase

intentions:

Measuring

interfunctional

interactions and

a cross-national

comparison

Shukla, P.

Journal of World

Business, 46(2)

(2011), 242–252

Measurement scales and framework.

Impact of normative interpersonal

influences, informational

influences, and brand-related cues

and brand image on luxury purchase

intentions.

However it depends of the cross

cultural context: individual and

developed market different from

collectivist emerging market.

Experience not taken into account.

Value-Based

Segmentation of

Luxury

Consumption

Behavior

Klaus-Peter

Wiedmann,

Nadine

Hennigs, and

Astrid Siebels

Psychology &

Marketing,

26(July 2009),

625–651

Use BLI scale of Vigneron &

Johnson.

Taking into account: Usability

Value, Uniqueness Value, Quality

Value, Self-Identity Value,

Materialistic Value, Hedonic Value,

Prestige Value in Social Networks.

Four clusters of luxury consumers:

Materialists, Rational

Functionalists, Extravagant

Prestige-Seekers, Introvert

Hedonists.

11

Luxury brands need to have an

integrative marketing strategy.

Consumer

Segments Based

on Attitudes

Toward Luxury:

Empirical

Evidence from

Twenty

Countries

Dubois, B.,

Czellar, S., &

Laurent, G.

Marketing

Letters, 16(2),

115–128 (2005)

International segmentation of

consumers based on their attitudes

toward luxury.

Scale to assess consumer attitudes

toward luxury in 20 countries.

3 main segments: elitists,

democratic, distant.

7.4 Wine and Champagne marketing: general elements

Title Author(s) Journal Content

Twilight of the

Idols in the

Market for

Champagne:

Dissonance or

Consonance in

Consumer

Preferences?

Vignes, A., &

Gergaud, O.

Journal of Wine

Research, 18(3),

147–162 (2007)

Consumers confused with vertical

differentiation and advertising

effects.

Best-quality champagne is not

selected when consumers select

according to the taste.

Possible dissonance with

information signals and personal

tastes.

Rational customers require

information to judge of the best-

quality product.

Representations

of the emotions

associated with a

wine purchasing

or consumption

experience

Mora, P., &

Moscarola, J.

International

Journal of

Consumer

Studies, 34,

(2010), 674–683.

3 categories of emotions related to

consumers’ involvement are

relevant: symbolic, affective, and

functional.

Brand not relevant (for wine

consumption).

3 segments: individualistic, hedonic,

and collaborative.

The Effects of

Perceptual and

Conceptual

Training on

Novice Wine

LaTour, K. a.,

LaTour, M. S.,

& Feinstein, a.

H.

Cornell

Hospitality

Quarterly, 52(4),

445–457. (2011)

Advertisement has an impact on

novice consumer personal

judgment.

Product experience makes learning

process easier.

12

Drinkers’

Development

Added value of conceptual and

perceptual teaching.

Perceptual learning (tastings) must

be supplemented with conceptual

learning.

The “real thing”:

Branding

authenticity in the

luxury wine trade

Beverland, M.

Journal of

Business

Research, 59(2)

(2006), 251–258

6 attributes of authenticity: heritage

and pedigree, stylistic consistency,

quality commitments, relationship

to place, method of production, and

downplaying commercial

considerations.

Authenticity consists of both

objective (real) and subjective

factors (stylized or fictional).

Authenticity affects consumers

perception.

Émergence et

dynamique du

phénomène de

réputation - Le

vin de

Champagne :

entre savoir-faire

et faire savoir

Gergaud, O;;

Vignes, A.

Revue

d’économie

industrielle, 91,

55–74. (2000)

Advertising efficiency level depends

on brand awareness.

Knowledge gap of consumers lead

to an inadequate understanding of

Champagne quality (advertising is

then more efficient to influence

purchasing behavior).

Brand recognition depend either on

quality or on the

communication/advert.

Impact of the

information

provided to

consumers on

their willingness

to pay for

Champagne:

comparison with

hedonic scores

Lange, C.,

Martin, C.,

Chabanet, C.,

Combris, P., &

Issanchou, S.

Food Quality and

Preference, 13(7-

8) (2002), 597–

608

Impact of external information

greater than impact of sensory

characteristics.

Consumers’ choice depends on the

brand awareness.

Brand has a positive influence on

perception.

Champagne’s

Sparkling Success

Sharp, A., &

Smith, J.

International

Marketing

Review, 8(4)

(1991), 13-19

Distinctive Competences of

Champagne: terroir, méthode

champenoise, Appellation d'Origine

Sustainable Competitive

Advantages: Supreme product

13

quality (high price, amount of

advertising, sustainability when

facing competitors).

Historical protection of the brand

name Champagne.

Champagne

Campaign

Wilson, I.

International

Journal of Wine

Marketing, 17(2)

(2005), 75–80

General information about

Champagne.

Importance of the concept of

geographical indication (GI) for

champagne and brand equity.

The Marketing of

Champagne: The

Way Forward

Salolainen, M.

International

Journal of Wine

Marketing, 5(4),

15–26. (1993)

Champagne as an "experience

good".

Superior functional quality is not

always perceived by consumers

perceived quality.

Signals must be used to educate

consumers and for differentiation.

Consumers’ perception depends of

advertising.

Experience

economy

constructs as a

framework for

understanding

wine tourism

Quadri-Felitti,

D., & Fiore, a.

M.

Journal of

Vacation

Marketing, 18(1),

3–15. (2012)

Pine & Gilmore framework adapted

to wine tourism.

7.5 Cross cultural context in consumer behavior

Title Author(s) Journal Content

Cross-Cultural

Consumer

Behavior : A

Review of

Research

Findings

Mooij, M. D.,

& Hofstede, G.

Journal of

International

Consumer

Marketing, 23,

(2011), 181–192

Review numerous studies about

cross-cultural differences.

Models to develop strategies that

target consumers across cultures

more effectively.

7.6 Concept testing

Title Author(s) Journal Content

Concept Testing

Moore, W. L. Journal of

Business

Research 10

Estimate consumers’ reaction to a

new concept.

Generate concept idea: conjoint

14

(1982), 279-294 analysis, focus group, and others.

Concept evaluation methods.

8 Methodology

For this paper, the methodology used is a combination of a theoretical approach,

an exploration of secondary data emanating from champagne houses, and an

empirical approach.

This approach fits the overall research design because:

- The main topics of this paper which are experiential marketing and

consumer luxury perception have already been partly investigated and

thus it is important to take the available knowledge into consideration.

- This research will analyse the different marketing strategies used by 3 or

4 champagne brands and the impact on consumer perception. Secondary

data emanating from these brands (see appendix 1) will be used to

understand what are the actions undertaken in the context of Pine &

Gilmore framework of experiential marketing 4Es.

- However, considering the research gap referring to experiential marketing

applied to champagne brands and its effects on consumer perception, an

empirical approach is necessary to develop the knowledge.

8.1 Theoretical approach

The theoretical approach aims at analysing the existing literature linked to the

present topic, and to offer an overview of the various existing scales dealing

with consumers’ perception of luxury and experience measurement, based on the

literature mentioned previously, and with the objective to design a questionnaire

to support the empirical research.

Consumer perception of luxury in general is different from one culture to

another. In order to explain the noticeable differences between the western world

and the eastern world, researchers are referring to the cultural dimensions

established by Hofstede, especially the individualism versus collectivism

aspects. The values that luxury conveys might be different across cultures.

15

This research is dealing with the perception of luxury brands. Thus, it is

important to highlight that the primary value of this category of brand is

psychological and symbolic, and the consumption of luxury is directly linked to

individual and social cues (Christodoulides, Michaelidou, & Li, 2009). The

value of the consumption of a luxury product lies in the psychological and

symbolic representation for the individual (self-identity) and their reference

group (social identity), and this is what differs luxury brands from non-luxury

brands. Several scales and framework have been built by researchers in order to

enhance the understanding of luxury brand perception. The use of the Brand

Luxury Index scale (BLI scale) carried out by Vigneron and Johnson is adequate

to measure perception of luxury products, and it has been validated by

Christodoulides, Michaelidou and Li (2009). Five dimensions of luxury brand

perception have been identified and divided into two categories which are the

non-personal oriented perception and the personal oriented perception. The non-

personal oriented perception refers to the perceived conspicuousness, the

perceived uniqueness and the perceived quality. The personal oriented

perception refers to the perceived hedonism and the perceived extended self

(Vigneron & Lester, 2004).

However, this scale is focusing on the global perception of luxury while we

are interested mainly in the experience and hedonic value perceived. Thus, the

BLI scale will be supplemented by other scales dealing with the experience

value such as the experimental value scale (EVS) of Mathwick et al. (2001)

which measures escapism and aesthetic dimensions among others. Other scales

will be studied such as the brand experience (affective) scale from Brakus,

Schmitt, and Zarantonello (2009), the enjoyment (expected) from Miller, Kahn,

and Luce (2008), and the transcendent customer experience scale from

Schouten, John W., James H. McAlexander, and Harold F. Koenig (2007) in

order to decide which one is the more relevant to build the questionnaire.

8.2 Secondary data

The core of the empirical research is to study the impact of various experiential

marketing actions undertaken on consumers’ perception within Pine and Gilmore

framework (four realms of experience: education, entertainment, aesthetic,

escapism). Thus, there is a need to analyse what are the current practices of

16

champagne brands in term of experiential marketing. In order to decide either an

action is belonging to one dimension or another, it would be more precise to pre-test

consumers directly to see which experiential dimension is affected. However, due to

a lack of time this won’t be possible. However, a scale will confirm or not the

belonging to one dimension (Mehmetoglu & Engen, 2011).

8.3 Empirical approach

8.3.1 Innovative concept development:

In today’s business world, companies have to be creative and innovative in order

to gain a sustainable competitive advantage. Therefore, one of the objectives of this

master thesis is to develop an innovative concept in order to enhance consumer

brand-related experience. Kotler (2005) stated that the customer’s role shouldn’t be

neglected in the final decision of starting a launching a new concept as they are the

main actors of its success. Taking this into consideration, the following steps are

describing the proposed methodology for innovative concept development.

8.3.1.1 Define the targeted audience

The targeted audience will be defined, using the various consumers

segmentations mentioned above in the literature review. It is crucial to know for

whom the concept will be developed because it provides with the consumers

characteristics and give an overview of their shared values and expectations.

8.3.1.2 Benchmarking and mind-mapping

Secondly, in order to generate innovative ideas, an exploratory market research

will be conducted as well as a benchmarking and then a mind-mapping.

8.3.1.3 Pre-test the concept: focus group

Thirdly, a focus group will be organized in order to pre-test this concept. Several

concerns will be addressed to the participant such as the clarity of the concept

statement, and the perceived usefulness of the concept. A focus group is a relevant

technique to adjust proposed innovative concepts as it highlights the defects,

disadvantages and advantages perceived by a specific group.

The focus group will be composed of 5 to 8 champagne consumers. It will take

place in France, in the Champagne region, and the participants will be French. The

concepts will be presented to the audience and discussed (advantages,

17

disadvantages). The overall session should lead to an improvement of the primary

concepts.

The use of materials such as images, sounds, or any other material that could help

to stimulate the participants will be defined later on.

8.3.1.4 Test the concept: quantitative techniques

The previous focus group will be then supported by the use of a quantitative

method. Indeed, in the consumer behavior fields, a mix between qualitative

techniques and quantitative techniques is recommended. What ultimately counts is

the approval of consumers. Thus, a section of the questionnaire will be dedicated to

the understanding of customers’ perception of the proposed concept, and help to

decide whether or not there is a potential success behind the innovative idea.

8.3.2 Online questionnaire

8.3.2.1 Setting

- France: original and particular market for champagne product.

- United Kingdom: developed and stable luxury market

- Russia/Ukraine/Belorussia: emerging luxury markets with a fast growth

and represent the BRICs category.

8.3.2.2 Participants

The ideal respondent for the online questionnaire is a luxury consumer that can

express an opinion about Champagne even if the level of involvement and

knowledge can be various. The objective is to obtain more than 150 answers for each

of the three studied region (France, UK, Russia). However, the questionnaire will

have different sections measuring different experiential marketing actions from

various champagne brands. Thus, it is more relevant to aim at 30 respondents per

actions, and per country group.

8.3.2.3 Intervention materials

See above the section dealing with concept development and pre-test focus group.

8.3.2.4 Measurement instruments

The questionnaire will be designed with respects to the five points Likert scale

and perception scales reviewed in the literature such as:

- BLI scale from Vigneron and Johnson (2004)

18

- Brand Experience (Affective) from Brakus, Schmitt, and Zarantonello

(2009)

- Enjoyment (Expected) from Miller, Kahn, and Luce (2008)

- Transcendent Customer Experience from Schouten, John W., James H.

McAlexander, and Harold F. Koenig (2007)

Items emanating from previous studies cited in the literature reviews will be used if

the validity of the scale in the experiential context is proved.

The questionnaire design will be subdivided into categories oriented on the four

realm of experience framed by Pine and Gilmore - the education, entertainment,

aesthetic and escapism dimensions.

Questionnaire will be available in French, English, Russian.

8.3.2.5 Procedures

The questionnaire will be designed with Sphinx, software allowing online survey.

The link of the online survey will be diffused widely on social network communities

(particularly linkedIn, corporate blogs). Champagne houses and associations will be

contacted in order to see if they can provide any support in order to collect data.

8.3.2.6 Data analysis

The questionnaire will be analyzed with Sphinx.

8.3.3 Methodological concerns

Firstly, one of the main concerns is the reliability of the scales that will be used.

A deeper analysis would be needed in order to ensure the validity of the scales.

Secondly, the respondents’ profile needed (luxury consumers) is not easy to find

and approach.

Thirdly, as this study is a cross national comparison, the data collection will

require dedicating a sufficient amount of time to achieve the objective of 150

respondents per markets.

Fourthly, the concept development is also a process that requires more

developed methods than a single focus but it is mainly an attempt to design an

experience and test it because of the time limitation.

9 Overview of Chapters:

1 Abstract

19

1.1 Introduction

1.2 Background

1.3 Problem Statement

1.4 Purpose and Research Questions

2 Theoretical framework

2.1 Experience economy

2.1.1 From commodities economy to experience economy

2.1.2 Definition of experience economy

2.1.3 Why is the experiential economy relevant for business?

2.1.4 How to design experiences?

2.1.4.1 The four realm of experience: Pine & Gilmore framework supported and

complemented by other researchers’ findings

2.1.4.2 Entertainment

2.1.4.3 Education

2.1.4.4 Aesthetic

2.1.4.5 Escapist

2.1.5 Measuring brand experience: brand experience scales of Brakus, J. J.,

Schmitt, B. H., & Zarantonello, L.

2.1.5.1 Brand Experience (Affective)

2.1.5.2 Brand Experience (Behavioral)

2.1.5.3 Brand Experience (Intellectual)

2.1.5.4 Brand Experience (Sensory)

2.2 Luxury marketing: different rules

2.2.1 Definition of luxury

2.2.1.1 Origin of luxury

2.2.1.2 Conceptualization of luxury

2.2.2 Luxury brands

2.2.3 Luxury consumers: value based segmentation

2.2.4 Luxury perception

2.2.4.1 Luxury perception scale: BLI scale of Vigneron & Johnson

20

2.2.5 Luxury and experiences

2.2.6 Luxury markets: different stage of development and importance cross-

cultural

2.2.6.1 Developed market

2.2.6.2 Emerging markets: BRIC

2.3 Champagne: luxury and experience

2.3.1 Overview of the champagne market

2.3.1.1 General trends

2.3.1.2 Developed market vs Emerging market

2.3.2 Champagne: more than a sparkling wine

2.3.2.1 Distinctive Competences of Champagne

2.3.2.2 Sustainable competitive advantage

2.3.2.3 Brand authenticity

2.3.3 Impact of the brand on consumer perception

2.3.3.1 Consumer perception of quality

2.3.3.2 Champagne and emotions

2.4 Champagne: the experience of a luxury product

3 Methodology

3.1 Theoretical approach: review of literature

3.2 Collect secondary data from Champagne Houses

3.2.1 Global picture of main actors / benchmarking

3.2.2 List experiential marketing actions undertaken

3.2.3 Brand awareness

3.3 Design of an innovative experiential concept

3.3.1 Define targeted audience

3.3.2 Brainstorming and Mind Mapping

3.3.3 Focus group: pre-test concepts and source of improvement

3.4 Empirical quantitative approach

21

3.4.1 Setting

3.4.2 Participants

3.4.3 Measurement Instruments

3.4.3.1 Brand-Experience perception measurement scales applied within the 4E’s

experience framework of Pine & Gilmore

3.4.3.2 Perception of innovative concept scales

3.4.4 Procedures

3.4.5 Data Analysis

4 Findings

4.1 Sample description

4.2 Results of Statistical Testing: data description

4.2.1 Entertainment experience perception

4.2.2 Educational experience perception

4.2.3 Aesthetic experience perception

4.2.4 Escapism experience perception

4.2.5 Brands perception

4.2.6 Innovative concept perception

4.3 Interpretations of Statistical Results

5 Conclusions/Discussion

5.1 Summary of Findings

5.2 Theoretical implications

5.3 Managerial implications

5.4 Limits

5.5 Recommendations for further research

10 Plan of Work

Time Management

29/1

0 -

4/1

1

5/1

1 -

11/1

1

12/1

1 -

18

/11

19/1

1 -

25

/11

26/1

1 -

2/1

2

3/1

2 -

9/1

2

10/1

2 -

16/1

2

17/1

2 -

23

/12

24/1

2 -

30

/12

31/1

2 -

6/0

1

7/0

1 -

13/0

1

14/0

1 -

20

/01

21/0

1 -

27

/01

28/0

1 -

3/0

2

4/0

2 -

10/0

2

11/0

2 -

17

/02

18/0

2 -

24

/02

25/0

2 -

3/0

3

4/0

3 -

10/0

3

11/0

3 -

17

/03

18/0

3 -

24

/03

25/0

3 -

31

/03

1/0

4 -

7/0

4

8/0

4 -

14/0

4

15/0

4 -

21

/04

22/0

4 -

28

/04

29/0

4 -

5/0

5

6/0

5-

12

/05

13/0

5-1

9/0

5

20/0

5 -

26

/05

November December January February March April May

Benchmarking

Secondary data collection

Secondary data analysis

Review of literature

Methodology

Innovative concept design

Focus group

Analysis of focus group results

Design the questionnaire

Test the questionnaire

Intermediate report first draft

Online questionnaire - collect data

Improvement of methodology

Improvement of literature review

Intermediate report

Findings (description)

Findings (analysis)

Limits

Further research

Managerial implication

Global reading and improvements

Preparation for final presentation

Buffer

Final presentation

23

11 Appendix - Proposition for the brand selection

12 Bibliography

Aiello, G., Donvito, R., Godey, B., Pederzoli, D., Wiedmann, K.-P., Hennigs, N.,

Siebels, A., et al. (2009). An international perspectiveon luxury brand and

country-of-origin effect. , 16(5-6), 323–337. doi:10.1057/bm.2008.52. (s.d.).

Journal of Brand Management, 16.

Atwal, G., & Williams, A. (2009). Luxury brand marketing – The experience is

everything! Journal of Brand Management, 16, 338–346.

Berthon, P., Pitt, L., Parent, M., & Berthon, J.-P. (2009). Aesthetics and

ephemerality: observing and preserving the luxury brand. California

Management Review, 52(1), 45–66.

Beverland, M. (2005). Crafting Brand Authenticity : The Case of Luxury Wines.

Journal of Management Studies, 42, 1004-1029.

Beverland, M. (2006). The “real thing”: Branding authenticity in the luxury wine

trade. Journal of Business Research, 59(2), 251–258.

Christodoulides, G., Michaelidou, N., & Li, C. H. (2009). Measuring perceived brand

luxury: An evaluation of the BLI scale. Journal of Brand Management, 16,

395–405.

Dubois, B., Laurent, G., & Czellar, S. (2005). Consumer Segments Based on

Attitudes Toward Luxury: Empirical Evidence from Twenty Countries.

Marketing Letters, 16(2), 115–128.

Fahey, L. (1986). Marketing and Competitive Advantage. Irish Marketing Review,

1(Spring), 103-8.

Gergaud, O., & Vignes, A. (2000). Émergence et dynamique du phénomène de

réputation - Le vin de Champagne : entre savoir-faire et faire savoir. Revue

d’économie industrielle, 91, 55–74.

Hoch, S. (2002). Product Experience Is Seductive. Journal of Consumer Research,

29, 448–454.

Holbrook, M., & Hirschman, E. (1982, September). The Experiential Aspects of

Consumption : Consumer Fantasies, Feelings, and Fun. Journal of Consumer

Research, 9, 132-141.

Huffman, C., & Houston, M. (1993). Goal-oriented Experiences and the

Development of Knowledge . Journal of Consumer Research, 20, 190–207.

25

Kapferer, J.-N., & Bastien, V. (2009). The specificity of luxury management:

Turning marketing upside down. Journal of Brand Management, 16, 311–

322.

Kotler, P. (2005). Marketing Management. New York: Prentice Hall.

La Tour , K., La Tour, M., & Feinstein, A. (2011). The effects of perceptual and

conceptual training on novice wine drinkers’ development. Center for

Hospitality Research of Cornell University.

Ladwein, R. (2005). L’expérience de Consommation, la mise en récit de soi et la

construction identitaire: le cas du trekking. Revue Management & Avenir,

105–118.

Lange, C., Martin, C., Chabanet, C., & Combris, P. (2002). Impact of the information

provided to consumers on their willingness to pay for Champagne:

comparison with hedonic scores. Food Quality and Preference, 13, 597–608.

Mathwick, C., Malhotra, N., & Rigdon, E. (2001). Experiential value :

conceptualization , measurement and application in the catalog and Internet

shopping environment. Journal of retailing,, 77, 39–56.

Mooij, M., & Hofstede, G. (2011). Cross-cultural consumer behavior : a review of

research findings. Journal of International Consumer Marketing, 23, 181–

192.

Moore, W. (1982). Concept Testing. Journal of Business Research, 10, 279–294.

Mora, P., & Moscarola, J. (2010). Representations of the emotions associated with a

wine purchasing or consumption experience. (34, Éd.) International Journal

of Consumer Studies, 674–683.

Pine, J., & Gilmore, J. (2011). Welcome to the experience economy. Harvard

Business Press.

Quadri-Felitti , D., & Fiore, A.-M. (2012). Experience economy constructs as a

framework for understanding wine tourism. Journal of Vacation Marketing,

18(1), 3–15.

Salolainen, M. (1993). The Marketing of Champagne: The Way Forward.

International Journal of Wine Marketing, 5(4), 15–26.

Schmitt, B. (1999). Experiential Marketing. Journal of Marketing Management, 15,

53–67.

Sharp, A., & Smith, J. (1991). Champagne’s Sparkling Success. International

Marketing Review, 3, 13-19.

26

Shukla, P. (2011). Impact of interpersonal influences, brand origin and brand image

on luxury purchase intentions: Measuring interfunctional interactions and a

cross-national comparison. Journal of World Business, 46(2), 242–252.

Shukla, P., & Purani, K. (2012). Comparing the importance of luxury value

perceptions in cross-national contexts. Journal of Business Research, 65,

1417–1424.

Snakers, E., & Zajdman, E. (2010). Does experiential marketing affect the behavior

of luxury goods ‘ consumers ? Master Thesis.

Solomon, M., Bamossy, G., Askegaard, S., & Hogg, M. (2006). Consumer

Behaviour: A European Perspective. 3rd ed. Harlow: Prentice Hall.

Vigneron, F., & Lester, J. (2004). Measuring perceptions of brand luxury. Journal of

Brand Management, 11(6), 484-506.

Vignes, A., & Gergaud, O. (2007). Twilight of the Idols in the Market for

Champagne: Dissonance or Consonance in Consumer Preferences? Journal

of Wine Research, 18(3), 147–162.

Wiedmann, K.-p., Hennigs, N., & Siebels, A. (2009, July). Value-Based

Segmentation of Luxury Consumption Behavior. Psychology & Marketing,

26, 625–651.

Wilson, I. (2005). Champagne Campaign. International Journal of Wine Marketing,

17(2), 75–80.

Wua, C. H.-J., & Liang, R.-D. (2009). Effect of experiential value on customer

satisfaction with service encounters in luxury-hotel restaurants. International

Journal of Hospitality Management, 28(4), 586-593.

Zarantonello, L., Schmitt, B., & Brakus, J. (2009). Brand Experience: What Is It?

How Is It Measured? Does It Affect Loyalty? , 73(3), 52–68.

doi:10.1509/jmkg.73.3.52. Journal of Marketing, 73(3), 52-68.