Friday, February 21, 2020

Iris Publishers- Open access Journal of Textile Science & Fashion Technology | Luxury Retail – The Online Experience



Authored by Cristina de Azevedo Rosa*

Abstract

The concept of luxury is as old as humanity even if over time meant different things, luxury is a conceptual and symbolic dimension and it is today the result of a historical evolution. Luxury is mainly irrational and engages strong and intense emotions, it is multisensory. “Luxury is above all a world of brands” Philip Kotler. The luxury brands go beyond the object: they are built from the reputation made from their creations within the social elites and trendsetters. The major conclusion Professor Dubois studies is that consumer attitudes and behavior towards luxury are ambivalent following an attraction/avoidance pattern (sometimes occurring within the same person). The watchword for luxury is experience and the shop is where the client lives the brand. Professors Bastien and Kapferer presented 4 modes of distribution [3], each one more suitable (than the others) according to the products/services and/or the markets where the luxury brand operates. To be able to be successful in selling luxury online, luxury brands have to build and implement an e-business strategy, the model presents 10 tactical important aspects. Today the world faces an uncommon and violent turbulence; severe crisis in Europe, instability in United States and accelerated growth in BRIC countries (Brazil, Russia, India and China) and soon in the CIVETS’s (Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa). However, the extraordinary results of the most important luxury groups are encouraging and reveal that so far challenges have been transformed in great opportunities. This paper has been adapted and updated from sections of the book, translation: Luxury Empire – Building Success.
Keywords: Luxury; Brands; strategy; Customer; E-retail; Success

Introduction

The concept of luxury is as old as humanity even if over time meant different things, luxury is a conceptual and symbolic dimension and it is today the result of a historical evolution [1]. The word luxury comes from the word in Latin “Luxus” which had its origin in agriculture, and it meant “exceeding growth” and became the word for exceeding in general; only in the 17th century did it acquire the significance that it has today [2].
Luxury is mainly irrational and engages strong and intense emotions, it is multisensory [3]. All definitions end in concepts of beauty, exquisiteness, perfection, pleasure, excellence, elegance, sophistication and exclusivity but also superiority, power, authority, distinction, ostentation, etcetera.
The Sociovision Confremca institute elaborated an international study [2] and revealed that luxury can be characterized by being distant, desired, merited, and providing a sensation of recompense, recognition and reward [2]. Still according to this worldwide study, luxury offers an emotional sensation of calm and tranquility in the moment of consumption. Luxury is experienced as a gathering between the “object” and a personal and private meaning of luxury which provides pleasure, comfort and harmony. Luxury is qualitative and not quantitative. For instance, the number of diamonds in a watch indicates its opulence not its beauty or aesthetics [3].

Luxury

“Luxury is something that we do not need but we cannot do without” Jean Louis Queimado - Vacheron Constantin Iberia [4].
Luxury is a culture and a philosophy and therefore requires deep understanding before the adoption of business practices because its particulars are fundamentally different from other types of goods [5]. The original function of Luxury is rooted in the social classes of societies when royals and aristocrats used pretentious consumption to demonstrate their superiority and maintain their distance from “others”. Even if this social structure is no longer dominant in the world the need for the individual to show his distinction, to be admired, recognized, appreciated and respected through differentiating himself in most cases with his possessions [5], has not changed.
Today the concept of luxury has changed profoundly, and it is incredibly fluid; luxury is no longer preserved for elite, people are enjoying more material comfort resulting in a cultural shift for personal achievement and aspiration through experience [6]. Therefore, it could be assumed that luxury is more and more about experience and authenticity rather than monetary value. This focus on aspiration and experience means that consumers want to improve their life mainly through personal transformation. The feminization of luxury was identified by Danziger, Israel and Gambler as; where luxury was moved from status symbols towards experience and indulgence [6].
Professor Kapferer estimated the luxury market to be 2 trillion of Euros in 2010 [3] and as Bernard Arnault, founder and CEO LVMH (Louis Vuitton Moet Hennessy), said clearly: “Luxury is the only sector that can provide luxurious margins” [7].

Luxury Brands

“Luxury is above all a world of brands” Philip Kotler [4].
The father of Marketing Mix – “The 4 P’s” - provoked a revolution in the 50’s with his model centered on the product with little competition. In those days’ brands weren’t important. In the 70´s, brand appears as an additional element to the product but after the 90’s of the last century, brands took the power and became a recognized signature with individuality and unique characteristics expressed by products and services [8].
Therefore, it is easy to accept that there is no luxury without brands3. The exception that confirms this rule is diamonds which are loved and admired in themselves, their nature size and purity, even if the jeweler is often a prestigious and luxury brand.
“Luxury objects are objects of luxury brands.” [3].
The luxury brands go beyond the object: they are built from the reputation made from their creations (objects and services) within the social elites and trendsetters. A recognized signature of all the stunning and beautiful distinction in the product and service, thereby the luxury brand has particular significance: it relates a social and cultural stratification and makes the wearer someone distinctive. Consequently, the luxury brand is a social indicator and creates distance [3].
Brands in luxury are most relevant since they are used as a social marker. In democracy people are free and equal, so they use components to differentiate themselves socially [3]. Within the limit of their financial means, they employ luxury as an instrument of social stratification. Consequently, luxury brands are a symbolic desire to belong to a social class, most of the time superior, even if this aspiration is rarely assumed.
Money only measures the wealth of the buyer and not his/ her elegance. However, the codes of luxury are cultural and to be successful it is fundamental for luxury brands to first encode social distinction, that way luxury brands exchange money into a culturally sophisticated social stratification [3]. The luxury brand is therefore the social and cultural visa for the product and the person.
A luxury brand is often a signature of the person whose name it bears, its founder9. The creator precedes the brand, has a history and social, cultural and geographical roots therefore the luxury brand is a real and living person. Like it is foundering the luxury brand progressively builds its reputation and its network of followers over time [3]. Gabrielle Chanel died in 1971 but Coco Chanel is still living.

Luxury Consumer

“There are two ways to go bankrupt: not listening to the client and also listening to him too much” [3].
It is crucial to listen (impartially) to the customer and never forget that “you” are not the customer. However, luxury brands must remain truthful to them and resist client’s demands when these do not correspond to the precise vision of the luxury brand [3].
Today consumers contradict themselves and confuse the best market research because they are a complex and ambivalent. It is essential to listen, interact and serve the consumer; this is the focus and the foundations for success and competitiveness of luxury brands [9].
In Professor’s Bernard Dubois (and colleagues) research [10], consumer attitudes towards luxury were analyzed and several characteristics, attitudes and types of consumers were identified. This important research brought relevant information about the luxury consumer.
In the first study (personal interviews) six facets and characteristics of luxury emerged [10]:
Excellent quality
The mental association between luxury and quality is powerful and sometimes synonymous. Consumers use two indicators to build their opinion: exceptional nature of the materials or components used, and the delicacy and skill involved in the manufacturing and delivery processes. They also feel it is an opportunity to become refined, unique and joyful;
Very high price
By comparison with non-luxury options or based on the absolute value of price, it is considered a logical consequence of the excellent quality associated with luxury and it is an inherent and accepted characteristic
Scarcity and uniqueness
Clearly, real luxury items cannot be mass-produced and should have restricted distribution. Luxury shops are perceived as important sources of experiences and therefore value. Luxury should be unique and reserved for a “happy few” providing exceptional experiences and emotions;


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