Brand management and marketing of luxury goods

Table of Contents

• 1 Introduction
• 1.1 An Approach to the Concept of Luxury
• 1.1.1 Historical Development of Luxury
• 1.1.2 The Relativity of Luxury
• 1.1.3 Target and Outline of Work
• 2 Luxury Products and Brands
• 2.1 Delimitation of Luxury Brands
• 2.2 Luxury Brands and the Economic Context
• 2.3 The Luxury Brand Customer
• 3 Personal and Social Functions of Luxury
• 3.1 Personal Functions
• 3.2 Social Functions
• 4 Specificities of the Luxury Industry
• 4.1 Market Characteristics
• 4.1.1 Company Size and Competition in the Market
• 4.1.2 Financial Characteristics
• 4.1.3 The Worldwide Luxury Market
• 4.2 Counterfeiting
• 4.2.1 Economical and Reputational Damage
• 4.2.2 Customer Behaviour
• 4.2.3 Countermeasures
• 5 Characteristics of Luxury Brand Management
• 5.1 Product
• 5.1.1 Handcraft and Quality
• 5.1.2 Innovation and Design
• 5.2 Price
• 5.2.1 The Challenge of Fixing the Price
• 5.2.2 Price Elasticity
• 5.3 Place (Distribution)
• 5.3.1 Characteristics of Distribution Channels
• 5.3.1.1 Flagship Stores
• 5.3.1.2 Franchise Shops, Specialist Dealers and Department Stores
• 5.3.1.3 Duty Free Shops and Outlets
• 5.3.1.4 Internet
• 5.3.2 Management of Distribution Channels - Artificial Shortage
• 5.3.3 Point of Sale and Customer Touchpoints
• 5.4 Promotion
• 5.4.1 Communication Strategy
• 5.4.1.1 Heritage and Country of Origin Effect
• 5.4.1.2 Social Responsibility and Sustainability
• 5.4.2 Communication Channels
• 5.4.2.1 Classical Media
• 5.4.2.2 (Sponsoring of) Events
• 5.4.2.3 Celebrity Endorsement
• 5.4.2.4 Company Website and Social Media
• 5.4.2.5 Product Placement
• 5.5 The Interaction of the Four Ps: Managing a Luxury Brand

Objectives and Key Themes

This thesis aims to analyze how luxury brands differentiate themselves from ordinary brands and the factors contributing to their success or failure in the market. It will explore the requirements for successful luxury brand management, drawing conclusions based on a detailed analysis of the marketing mix.

• The definition and evolution of luxury.
• The economic impact on the luxury industry and consumer behavior during economic fluctuations.
• The personal and social functions of luxury brands and their influence on purchasing decisions.
• The specific characteristics of the luxury industry, including market structure, competition, and the challenge of counterfeiting.
• The elements of luxury brand management, focusing on product, price, place, and promotion.

Chapter Summaries

1 Introduction: This chapter introduces the concept of luxury, its historical evolution, and its relative nature. It explores the changing perceptions of luxury across different historical periods and socio-economic contexts, highlighting the shift from "absolute luxury" to "relative luxury." The chapter establishes the thesis's objective: to analyze how luxury brands establish and maintain their positions in a highly competitive market and the key components of successful luxury brand management. The chapter also provides a roadmap of the subsequent chapters and outlines the methodology for the study.

2 Luxury Products and Brands: This chapter distinguishes between different brand categories (private labels, premium brands, luxury brands, and griffes) using Kapferer's pyramid model and Maslow's hierarchy of needs. It examines the impact of economic contexts, specifically the 2009 financial crisis, on the luxury market and analyzes the behavior of luxury brand customers, highlighting the emergence of the "hybrid" customer. The chapter concludes by emphasizing the inherent difficulties of defining and targeting this diverse customer base.

3 Personal and Social Functions of Luxury: This chapter delves into the motivations behind luxury purchases. While traditional branding functions like risk reduction and information efficiency play a role, the chapter emphasizes the greater importance of image benefit, self-fulfillment, and status signaling. It analyzes both personal (self-gratification, reward, hedonistic consumption) and social (status, prestige, group affiliation) functions of luxury goods, exploring the interplay between intrinsic and extrinsic motivations and how these influence brand perception and consumer behavior.

4 Specificities of the Luxury Industry: This chapter focuses on the unique characteristics of the luxury industry, contrasting it with other sectors. It examines company size and market competition, highlighting the dominance of large luxury groups while also noting the relatively small size of individual luxury brands. It delves into the financial characteristics of luxury brands, analyzing profitability, high break-even points, and the paradoxical survival of loss-making brands. Finally, the chapter discusses counterfeiting – its economic and reputational damage, customer motivations, and the various countermeasures employed by the luxury industry.

5 Characteristics of Luxury Brand Management: This chapter analyses luxury brand management through the lens of the four Ps of marketing (Product, Price, Place, Promotion). It examines product quality, craftsmanship, innovation, and design; pricing strategies including the challenges of establishing and maintaining premium pricing; distribution channels focusing on flagship stores, franchise shops, specialist dealers, duty-free shops, outlets, and the role of the internet; and communication strategies emphasizing brand identity, heritage, storytelling, social responsibility, and the utilization of various media and celebrity endorsements. The chapter concludes by emphasizing the vital interdependence of all four Ps in successful luxury brand management.

Keywords

Luxury brands, brand management, marketing mix, consumer behavior, luxury goods, premium brands, counterfeiting, economic impact, social functions, personal functions, brand identity, heritage, country of origin effect, distribution channels, communication strategy, social media, celebrity endorsements, sustainability.

Frequently Asked Questions: Comprehensive Language Preview on Luxury Brand Management

What is the overall topic of this document?

This document is a comprehensive language preview of a thesis analyzing luxury brand management. It provides a table of contents, objectives and key themes, chapter summaries, and keywords.

What are the main objectives of the thesis?

The thesis aims to analyze how luxury brands differentiate themselves, the factors contributing to their success or failure, and the requirements for successful luxury brand management. It focuses on a detailed analysis of the marketing mix.

What are the key themes explored in the thesis?

Key themes include the definition and evolution of luxury, the economic impact on the luxury industry and consumer behavior, the personal and social functions of luxury brands, the specific characteristics of the luxury industry (including counterfeiting), and the elements of luxury brand management (product, price, place, and promotion).

What does the introduction chapter cover?

The introduction defines luxury, traces its historical evolution, explores its relative nature, and sets the objective of analyzing how luxury brands maintain their market position. It outlines the thesis's methodology and provides a chapter roadmap.

What is discussed in the chapter on luxury products and brands?

This chapter distinguishes between different brand categories, examines the impact of economic contexts (like the 2009 financial crisis) on the luxury market, and analyzes the behavior of luxury brand customers, including the "hybrid" customer.

What are the personal and social functions of luxury discussed in the thesis?

The chapter on personal and social functions explores the motivations behind luxury purchases, emphasizing image benefits, self-fulfillment, status signaling, self-gratification, reward, hedonistic consumption, and group affiliation. It analyzes the interplay between intrinsic and extrinsic motivations.

What are the specificities of the luxury industry according to the thesis?

This chapter focuses on the unique characteristics of the luxury industry, including company size and market competition, financial characteristics (profitability, high break-even points), and the significant challenge of counterfeiting, its impact, and countermeasures.

How does the thesis analyze luxury brand management?

Luxury brand management is analyzed through the four Ps of marketing: Product (quality, craftsmanship, innovation, design), Price (pricing strategies), Place (distribution channels including flagship stores, online sales, etc.), and Promotion (communication strategies, heritage, social responsibility, media use, celebrity endorsements).

What keywords are associated with this thesis?

Keywords include luxury brands, brand management, marketing mix, consumer behavior, luxury goods, premium brands, counterfeiting, economic impact, social functions, personal functions, brand identity, heritage, country of origin effect, distribution channels, communication strategy, social media, celebrity endorsements, and sustainability.

What is the structure of the Table of Contents?

The table of contents is structured hierarchically, breaking down the thesis into five main chapters, each with numerous sub-chapters and sub-sub-chapters, providing a detailed overview of the thesis's scope.