Category Archives: Branding

The Luxury Brand Ranking and Consumer Accessibility Pyramid: What It Takes to Move Up

Commentary by James D. Roumeliotis with pyramid created by Erwan Rambourg

Luxury Image - Woman With Diamond

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Few brands can really claim the trademark of luxury. It is those which combine allure with pedigree and quality attributes. Discounting is not part of their strategy and their entire raison d’être is geared to the Ultra High Net Worth (UHNW). Many of their products actually increase in value over time since they are either discontinued, necessitate a long waiting list/time and are most desirable (supply/demand). Many also offer bespoke products and services since their type of discreet clientele prefer personalization and/or one of a kind. Brands that become too accessible are less appealing to such well-heeled buyers.

Erwan Rambourg, an HSBC managing director and author of the book, “The Bling Dynasty: Why the Reign of Chinese Luxury Shoppers Has Only Just Begun” created a luxury brand pyramid which depicts how major brands range in accessibility from the lower end with “accessible luxury”, such as spirits, a fine steak and perfume, to ultra-high-end luxury like rare diamonds. This is the luxury influence level ranking pyramid:

Luxury Pyramid by Erwan Rambourg

Getting On Top of the Pyramid

Luxury purveyors who aspire to cater to the top tier of spenders should have a mission, vision and a sound implementation strategy to reach this elite demographic target ‒ short of simultaneously pursuing the aspirational consumers who are prone to cutting back when the economy takes a dive. This latter group of consumers dilutes the cachet of the brand and can turn out less profitable in the long run. Moreover, the High Net Worth Individuals or HNWI and Ultra High Net Worth Individuals or UHNWI frown upon offerings which are accessible to the mainstream as they desire status and exclusivity.

Products and services should be unique, well designed and packaged, finely crafted ‒ and executed with refinement for the elite. Those are ways to entice the interest of, and ultimately retain, the ultra-wealthy. Products and services should never appear as ordinary yet absolutely personal.

In the luxury sector, traditionally there hasn’t been any shortage of customization for the very well heeled. Exclusive and bespoke travel companies provide tailor made adventures and excursions, whereas, the ultra-luxury and exotic automobile sectors such as Rolls Royce and Ferrari respectively offer a wide array of customization options. Each vehicle coming out of the studio will be completely unique and guided by a personal designer at the manufacturers. This is how ‘the total customer experience’ materializes.

What do the HNWIs and UHNWIs seek in their lifestyle?

According to the white paper, Strategies for Effectively Marketing to High Net Worth Consumers”, written by Richard Becker (August 2008), High Net Worth Individuals enjoy Golf, tennis and physical fitness ‒ endeavors typically associated with exclusive ‘members only’ clubs.

HNWIs/UHNWIs cherish their time and know what they want. Even time is a luxury and limited resource for them, thus saving time greatly trumps saving money. This is part of the reason service is crucial for them. They can be generally described as:

– Seek a higher and exacting standard with a minimum set of expectations;
– Fussy in nature;
– Often require customized solutions to mirror their lifestyle – whether a product or service;
– Take pleasure on getting extra attention from the brands they pursue;

– Prefer the uncommon to the mundane;
– Expect to be offered unique choices and experiences;
– Synonymous with a taste for luxury with pedigree and craftsmanship which they’re able and willing to pay;
– Aspire an aura of exclusivity;
– Crave an experience heightened by exceptional service along with a personal relationship;
– Seek products which are different and more sophisticated – whether it’s apparel, electronics, food or insurance;
– Want to feel in command of their purchase decision without any pressure;

– Expect discretion and confidentiality – most notably from service providers such as private wealth institutions and concierge services amongst others.

Likewise, what they purchase is a visual extension of their individuality and lifestyle. A well-crafted product, for example, reflects an individual call to beauty.

Putting it all into perspective

In the United States the top 1% possess 40% of the wealth owns half of all the stocks, bonds and mutual funds.

Fickle and discriminating, these customers’ purchasing attitudes are based on personal beliefs and taste for finer things in life along with discretion. They are quite selective, know what they want and aspire to be catered to effortlessly. They seek the total customer experience along with pampering, personalized service which can include fashion consultations and exotic journeys. Best of all, they are willing to pay top money for the products and services they want.

An offline strategy requires an equal online presence. This is accomplished by placing stunning imagery, video, engaging content and constant refinements along with savvy Internet marketing to connect the brand with luxury social channels. It’s connecting with its like-minded audience.

Think brand positioning and focus on, as well as cater solely to, your core market rather than be all things to all people. Stay out of the bottom end and aspirational markets and instead, aim at the top end markets.

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Filed under brand positioning, Branding, Business, lifestyle marketing, Luxury, luxury lifestyle, luxury storytelling, Marketing, positioning, sensuous brands

Adding Personality to a Dull Product Through Clever and Humorous Ads

By James D. Roumeliotis

Poo Pourri Ad Image

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Let’s be candid: not many of us pay much attention to advertising for life insurance, bathroom tissue or medical devices. What’s there to be excited about? Adding a dose of personality with humor may create attention for those types of products which we would not otherwise have given them much attention — especially among a plethora of advertising. This also applies to generic products such as soap and bottled water.

Not every product or service brand is stimulating

Not every brand is as exciting such as Victoria Secret, Porsche or Apple. Many brands, it turns out, are simply staid, generic or both. However, the creative ones have put much thought into developing content which captures attention. This would come in a form of either:

– a humorous type ad;

– an emotional style ad which results in becoming remarkable and memorable; or,

– embodies a certain lifestyle which most in the target market would be able to relate to as their own;

– it turns out good enough that many of us would share the advertisements with others (as I am doing in this article).

Cases in point worth noting: clever ad campaigns

Below are examples of products and services which can stir emotions – whether arousing, dramatic or amusing.

Zyppah (snoring device)

Zyppah (“Happy Z” spelled backwards) is an oral sleeping device which claims to eliminate snoring. It doesn’t sound or look like a sensuous device, so the brand decided to develop a clever advertising campaign by creating a character – a spokesperson of sorts with a thick New York City accent, named “Jimmy.” The results can be watched and heard below.

https://www.youtube.com/watch?v=mZBiPxn-haA

https://www.youtube.com/watch?v=nWHIkX7_mHY

Poo-Pourri (a fragrance brand that develops and markets deodorizing toilet sprays)

 Suzy Batiz had an obsession with getting rid of “poop odor” to the brink that for nine months she relentlessly worked on developing an oil-based spray you put on the surface of toilet water before you go. It worked! Her claim is that her product, named Poo-Pourri, has a unique oil which “…creates a layer, and whenever the poo goes in, it actually encapsulates it, it sort of ‘wraps’ the odor.” Truth be told, bathroom products are not the most thrilling to market, let alone such a spray to diminish poo smell – or so you thought. By taking a taboo subject and adding humour and surprise, Suzy Batiz and her marketing creatives, decided to add a dose of bliss to the video ad by featuring an elegant, well-dressed woman with a British accent and revealing her grief of trying to disguise unpleasant bathroom aromas. The ‘Girls Don’t Poop’ initial ad campaign quickly went viral gathering over 6 million views and 278,000 shares in its first week. Here is the video link: https://youtu.be/ZKLnhuzh9uY

Big Lou/Term Provider (life insurance broker)

Life insurance, for many, is a morbid product which needs to be sold rather than bought by most on – and if so, on their own initiative. Therefore, how does a prominent term life insurance brokerage firm start a conversation and promote its intangible products which only beneficiaries can eventually claim its proceeds? Term Provider, the actual name of a term life provider decided to add a pun by branding it with a catchy name – Big Lou – as if its owner is obese and nicknamed Lou is in Louis. We are not certain if the founder/owner of this agency is actually overweight as he claims, as we do not get to see him in his ads. His ads, link below, are for the most part, aired on CNN satellite (think Sirius XM) radio.

https://biglou.com/commercials/

Eyelab (Optometry examination facility in South Africa)

This ad campaign was created in a form of print advertisement by Canvas in South Africa for Eyelab, to promote its professional services. The one below insinuates that this attractive lady needs to have her eyes examined since she appears to have chosen an incompatible and geeky looking man as her mate. In reality, her choice can be quite subjective and a personal choice of hers without any of us being too judgemental. Needless to say, it is eye examination promotional content with a different twist.

http://adsoftheworld.com/media/print/eyelab_couple_1

Optometrist Funny Ad

Bling H2O (luxurious) water

How about branding water and putting the world’s most expensive price tag on it predominantly by visual appeal and perception? That’s just what its founder and president, Kevin G. Boyd, did for Bling H2O which he labels it as “luxury” and charges about $44 per bottle. He has accomplished this through a clever marketing strategy such as:

– focusing on distribution of limited editions;

– creating a fancy glass water bottle to add cachet;

– conveying a glamorous story with his marketing messages;

– has celebrities sipping his water and as a result, gaining massive publicity.

AAA

Virgin America and Air New Zealand (airline safety instruction videos)

In less than two weeks following its release online, Virgin America managed to get almost 6 million people to watch their safety video without even stepping foot on the plane.

https://www.youtube.com/watch?v=DtyfiPIHsIg

Air New Zealand created something a little different and entertaining for their safety instructional video by celebrating the third and final film in The Hobbit Trilogy – The Hobbit: The Battle of the Five Armies.

https://www.youtube.com/watch?v=qOw44VFNk8Y

In the final analysis

Although many products or services such as bottled water, insurance and banking services are not exciting on their own, it doesn’t mean they should remain dull. They still do have the potential to be branded with charm, emotion, sex appeal, or yet attributed to a certain lifestyle. A good sense of humor also comes a long way – provided that creative campaigns can be produced with unique and passionate content worth talking about and sharing.

Positioning the brand is another way to differentiate any generic product. It’s what you create in your target customer’s mind, along with the benefits you want him or her to think of when he or she thinks of your brand.

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Filed under 1, brand positioning, Branding, branding not products, Business, customer engagement, Marketing, sexy advertising

The Authentic Brand: A Precious Asset Developed Through Transparency, Customer Experience and Ultimately, Loyalty

By James D. Roumeliotis

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Honest by ad. A pioneering company launched in January 2012. The company is unique in communicating about the supply chain of its products and pricing.

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Trust is a hard thing to come by these days whether between people or between people and brands. When the founders of a start-up build a brand from the ground-up or the executives of an established one are in modus operandi mode, taking a cautious approach to their brand image, in both scenarios, ought to be part of growing and preserving the business with a constant eye on the future.

Sadly, nonsense, and plenty of it from ubiquitous brands, is probably the best noun to describe what consumers are offered by many companies selling their products and services to them. Whether it is advertising, package labeling or an overstated pitch by their sales staff, the information presented may be deliberately misleading. With some brands, it is the tiny print in disclosure statements which defeat what is promised in larger and bold advertising headings. The majority of consumers do not read small footnotes. Think of the worst offenders of this practice: the cellular phone/telecommunication providers, insurance companies, credit card providers, as well as the automobile manufacturer promotional offers and pharmaceutical advertisements – to name a few.

Deception concealed as sincerity: How to chip away at your brand

The key to a successful business growth, along with reputation, is truth in advertising, delivering on promises made, avoiding deceit – and marketing the brand, not the product. Contrary to popular belief, a brand is not a logo, label or product but rather a relationship with customers. It is a promise. Branding, when carefully executed, adds value to a company including brand equity. This is considered intangible brand value. By applying a short-term revenue and profit strategy at the expense of long-term negative consequences, a business’s brand reputation will ultimately lose its luster.

In the 2015 Harris Poll Reputation Quotient®, published the reputations of the 100 most visible companies among the U.S. general public. What appears on the top five, among other notable brands as consumers perceive them, are Wegmans Food Markets, Amazon, Samsung, Costco and Johnson & Johnson respectively.

Consumers have high and explicit expectations from brands, thus anticipate what the brand promises via its marketing material and/or what is stated on the product packaging. What a brand actually delivers and how it behaves in the process is what consumers get to feel.

A brand which utilizes short-term sales and marketing tactics for quick short-term gain fails financially in the long-term by acting in an ethical way. As marketing maven Seth Godin rightfully proclaims, “In virtually every industry, the most trusted brand is the most profitable.” As with our personal lives, trust with branding is based on what one does, not what one says.

Boosting sales and market share via misleading and deceptive tactics

According to a 2013 Harris Poll, regarding the most and least trusted industries, the advertising industry was near the bottom of the list when rated up against many other business sectors. Seemingly, truth in advertising is a misnomer. Misleading and deceptive advertising by many marketing and branding executives, give the entire industry a negative perception.

The food processing domain is no more honest with labels that claim to be healthy but without support with any concrete scientific facts. Food companies tout their devious label claims of organic, nutritious etc. – although an absurd amount of sugar and/or sodium is present in the ingredients along with unnatural artificial ingredients). Kelloggs even went as far as having to be ordered, by the courts, to discontinue all Rice Krispies dubious advertising which claimed to boost a child’s immunity system.

Then there is the “premium” orange juice from popular brands such as Tropicana, Simply Orange and others which are highly processed, and usually stored for several months before reaching consumers at the supermarket fridge aisles. This processing method is used to retain the juice from spoiling. However, during that process, it also strips the flavour which is injected back into the product, once it finally gets packaged, to give the juice its original orange flavour. Not surprisingly, the orange juice producers do not make any reference to this anywhere.

Informative and authentic eye-opener documentaries such as Food Inc. and Tapped have upped the ante in terms of the exposure shared with the public to what is wrong with the food processing/food chain and water bottling sectors respectively. Moreover, the GMO debate with the exceptionally well-connected and deep pocketed Monsanto (the St. Louis-based biotech giant and world’s biggest seed seller) will not be going away any time soon.

Other industries notorious for deceit are banks and cellphone/telecommunication companies with their hidden fees. These blatant revenue generators are sales at any cost – short-term gains, of course. These companies guilty of gouging seem to be testing the limits with consumers – as if the latter are ignorant. Those absurd fees evidently enrage the culprits’ customers.

Employees reflect the brand

First and foremost, trust begins with company employees. If they are well trained and treated with respect and transparency, the employees will trust their employer and radiate their enthusiasm, as well as loyalty to their customers by going the extra mile.

Along with a brand being a valuable asset for any business, people also fit into the equation as an important asset. This is where hiring the right people, on-boarding them, training them adequately and empowering them all create a positive impact on customer satisfaction.

Many brands are myopic to the point that they unintentionally and unknowingly allow their dissatisfied customers to go away without a thought. Front-line staff is either not trained properly and/or lacks the proper attitude to handle clientele appropriately.

During the industrial era, consumers would simply purchase what was produced, shopping where that product was available and paying the price the retailer demanded. In essence, the manufacturer and the store were in position of strength. As products and consumers have changed over the years, the concept of ‘brand loyalty’ and ‘consumer insight’ came about. As we progressed into the new millennium, the transparency and unrestricted information available on the internet has changed all of that. Today consumers are not only better informed but they are also in control. They can make or break a brand through their actions. So what does this say about listening – and acting?

Consumers will no longer refrain from informing companies on what may have gone wrong ─ whether it’s a particular brand or a competitor’s. With the numerous platforms for consumers to make their voices heard online, brands have to be very reactive and not allow anything to chance. In an age when the consumer’s outcries and influences spread quickly, the results can signify lost sales and a deterioration of brand loyalty.

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When all is said and done

Building and nurturing a brand is what makes an enterprise gather wind under its wings. Common intelligence dictates that the way a customer is dealt with reflects on the integrity of the brand, and the image of the company in the mind of the consumer.

A “Brand” is a promise of something that will be delivered by a business. This promise comes in a form of quality, an experience and a certain expectation in the mind of the consumer. It includes the Unique Selling Proposition (USP). Marketing, on the other hand, is about spreading compelling messages to your target audience while branding is a combination of words and action. Marketing is extroverted and communicates quickly, while branding is introverted and a slow process if it’s to produce any real impact. Effective marketing activities are vital in developing a brand. When combined successfully, branding and marketing create and promote value, trust, loyalty and confidence in a company’s image, products and services.

According to an Edelman’s Trust Barometer, it was revealed that 77% of respondents refused to buy products from companies they distrusted. More disturbing is that 72% said they had criticized a distrusted company to a friend or colleague.

When customers are treated with honesty and delighted by a particular brand experience, they begin to bond emotionally with the brand. They become brand loyalists and advocates – buying the brand more often and recommending it to others. This behavior serves to build the brand’s reputation. This approach is priceless –even though it may take longer to take positive effect.

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Filed under brand equity, Branding, Business, Business success, catering to picly clients, corrupt companies, stimulating brands, total customer experience

The Cult Brand: Providing an exceptional experience to the point of total customer devotion

by James D. Roumeliotis

harley-brand-tattoo

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There are brands that tout their virtues of their products and/or services with a religious fervor. A “cult” brand is a product or service with a strong loyal customer following, whereby their clients are fanatical about their products or services to the point where their lifestyle revolves around those popular brands. This level of fanaticism also makes those devout followers unsolicited brand ambassadors.

Cult brand examples with customer aficionados include Apple, BMW, Porsche, Fox News, Lulumemon, Zappos, Oprah, Harley Davidson and Starbucks to name a few. As with Starbucks, it offers a superior product and experience that some people would go out of their way, by driving by less expensive alternative coffee shops, to pay for Starbucks’s pricier cup of coffee.

More than just a product or service, it is a lifestyle

Generally speaking, brands that are designed for a lifestyle should have a much higher emotional value to consumers than ones based on features like cost or benefits alone.

Call it “hype” or give it any other label, cult brands are a unique breed which create and are given plenty of attention. Their brand value is also much higher than their closest competitors. They have achieved a special connection with consumers through their distinctive appeal.

Unlike religious or similar type cult following, the cult brand is considered “benign” or a “benign cult” since it satisfies a need and desire in a positive and harmless manner. Some brand loyalists have gone as far as having their beloved brand tattooed on their body.

A brand is considered as a “cult” brand if the following aspects are present:

  1. Customers receive more than a product and/or service ─ they experience a lifestyle;
  2. Brand devotees firmly believe there are no substitutes for their beloved brand;
  3. Customers feel a sense of ownership with the brand;
  4. Loyalty is prolonged over time compared to brands which are considered fads and unsustainable in the long-term;
  5. An extraordinary degree of customer loyalty exists.

Ingredients of a cult brand: using psychology, identity and a sense of belonging

It is not enough for brands to spend plenty of money on glorified advertising. Any company with an adequate budget can do that. The essential challenge is to utilize an approach that makes people to want to embrace a product and/or service that people would enjoy making it part of their life, as well as identity and belonging.

Brand cult status is an emotional component of the brand but it is not as simple to achieve. As per The Cult Branding Company, a brand consultancy firm, there are seven rules of cult brands this author stands behind ─ and are as follows:

Rule #1 – Differentiate: To achieve a special connection with consumers, the brand should have a distinctive allure and be unconventional in a good sense.

Rule #2 – Be Courageous: Cult Brands are successful because they are unlike their competitors. They possess their own personality, DNA and rules. They are also passionate about their offerings and their customers for whom they exist in the first place.

Rule #3 – Promote a Lifestyle: The goal of a lifestyle brand is to get people to relate to one another through a “concept brand.” These brands successfully sell identity, image and status rather than merely a “product-service” in the traditional sense of the term.

Rule #4 – Listen to Your Customers: Focus on serving your customers’ desires by being customer-centric. Encourage feedback and utilize it as an opportunity to form ideas, and provide solutions that establish and retain loyalty.

Rule #5 – Support Customer Communities: Cult Brands build effective and sustainable relationships with their customers by developing and supporting a customer community which allows users, partners, and company employees to share information, answer questions, post problems, and discuss ideas about product enhancements and best practices in real time. Cult brands also gather their loyalists by organizing occasional social events to ignite additional enthusiasm for the brand.

Rule #6 – Be Open, Inviting and Inclusive: Cult Brands do not discriminate in terms of age, race or sexual preference. As such, everyone who believes in the brand’s mission is welcome.

Rule #7 – Promote Personal Freedom: For most, the Abraham Maslow hierarchy of needs pyramid includes elements of self-esteem and self-actualization. As such, a well-regarded brand will express this as much by promoting freedom which is essential in expressing one’s own unique identity and worldview without fear of consequences.

brand-loyalty-2

In the end: Achieving the highest level of emotional connection via brand advocacy

Cult brands have a fanatical customer base. A culture is created around the brand based on consumers of a niche group. From there, the brand evangelists spread the message and enlist more followers.

When consumers are treated with honesty and delighted by a brand experience, they begin to bond emotionally with the brand. They become brand loyalists and advocates – buying the brand more often and recommending it to others. This behavior serves to build the brand’s reputation. This approach is priceless – even though it may take longer to take positive effect.

That said, innovative products, exceptional services, the total customer experience and the lifestyle which comes with being associated with the brand are what truly makes a cult brand exceptional from competing brands. The key objective is to create a relationship of trust. The world’s powerful brands establish trust and friendship with their customers. They develop emotional capital, and gain passion. This is what makes them great, thus “cult” brands.

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Filed under Branding, branding not products, Business, customer experience, lifestyle marketing

Brand Equity: Building and Maintaining It Through Competencies, Integrity and Loyalty

By James D. Roumeliotis

Brand Equity image - Coke bottle

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Those in business should know the meaning of a “brand” (source: Investopedia”/ a distinguishing symbol, mark, logo, name, word, sentence or a combination of these items that companies use to distinguish their product from others in the market.). Taking it further, a “brand” is a promise of something that will be delivered by a business. This promise comes in a form of quality, an experience and a certain expectation in the mind of the consumer. It includes the Unique Selling Proposition (USP).

A brand is an intangible asset which may increase in value if the business is positively impactful. We refer to this as “brand equity” which is comprised of brand awareness (the level of familiarity with the uniqueness of a company’s products and/or services), brand attributes (are the practical and emotional links which are allotted to a brand by its clients and potential customers), perceived quality (the customer’s perception of the quality of a product and/or service of a particular brand), and brand loyalty (when customers turn into advocates and loyalists due to their favorable series of experiences).

To get an idea of the value of global brands, one only needs to consult the annual list of the most valuable brands compiled by Interbrand ─ a global brand consultancy firm.

Consumer trust is the company’s most valuable asset; thus it must be protected.

Brand building: the importance of transparency

The key to a successful business growth, along with reputation, is truth in advertising, delivering on promises made, avoiding deceit – and marketing the brand, not the product. Contrary to popular belief, a brand is not a logo, label or product but rather a relationship with customers. It is a promise. Branding, when carefully executed, adds value to a company including brand equity. This is considered intangible brand value. By applying a short-term revenue and profit strategy at the expense of long-term negative consequences, a business’s brand reputation will ultimately lose its luster. Along with ethics, transparency affords many benefits to the organization such as higher business valuations when seeking investor capital, improved attraction and retention of high caliber employees, and scores of loyal clients. Companies which are forefront with their mistakes will be heavily rewarded. This is a trend called “flawsome.”

According to an Edelman’s Trust Barometer, it was revealed that 77% of respondents refused to buy products from companies they distrusted. More disturbing is that 72% said they had criticized a distrusted company to a friend or colleague.

When consumers are treated with honesty and delighted by a particular brand experience, they begin to bond emotionally with the brand. They become brand loyalists and advocates – buying the brand more often and recommending it to others. This behavior serves to build the brand’s reputation. This approach is priceless –even though it may take longer to take positive effect.

Brand Equity Matrix

Faux pas or deceit?

Reputations and trust affect brand equity. They are more difficult to win back than to lose. To become a desirable brand, be easy to do business with, focus on efficient and hassle-free service and refrain from deceiving customers.

Unfortunately, these days we witness many companies, most are public, whose short-sighted strategies to spruce up profits, increase market share and maintain shareholder value, made the executives complicit in creating circumstances which resulted in cheating their customers ─ albeit discreetly. Nonsense, and plenty of it from ubiquitous brands, is probably the best noun to describe what consumers are offered by many companies selling their products and services to them. Whether it is about their advertisement, package labeling or an overstated pitch by their sales staff, the information presented may be deliberately misleading. Other brands take it further with their tiny print in disclosure statements – which defeat what is promised in larger and bold advertising headings. Alas, the majority of consumers do not read small footnotes.

The following are a few examples depicting such cases.

Chobani, renowned producer in the U.S. of Greek style yogurt with a significant share in its category was recently taken to court by a group of consumers for its false advertising. The plaintiffs claim that Chobani’s nutritional declarations on its product packaging are deceptive and confusing. Instead of reacting cautiously, Chobani officials were condescending. In court, they blamed consumers for being naïve and unable to apply common sense when going grocery shopping. They went further urging the judge to throw out the case.

Canadian based large dairy and cheese producer Saputo thought it was a good idea to shrink the size of their milk bags rather than raise prices. After all, consumers would not take notice, was their thinking. However, what Saputo failed to realize is that consumers these days are savvier as they take the time to research online and elsewhere. They are also prudent where and how they spend their money – seeking the best value. Furthermore, people seek transparency with brands, let alone the ones they are loyal too. Consumers certainly do not appreciate deception.

Now Saputo is scrambling to win back customer trust and loyalty by investing millions in doing so.

British Airways, once the pride of the British as “The World’s favorite airline”, decided (their number crunchers take all the credit) without any advance notice to its passengers/customers, to eliminate long haul meals to Economy passengers for flights under eight-and-a half hours. Instead of the usual offer of a sandwich snack, the crew has been instructed to offer only one fun-sized chocolate six hours after their first meal. This frugal attempt has naturally infuriated customers.

General Mills, the food giant known for its breakfast cereals was not immune from a lawsuit claiming it misled consumers by marketing Cheerios Protein cereal as a high-protein alternative to regular Cheerios.  However, the main difference was that the former new version contained 17 times more sugar per serving than the latter regular version.

The above brands have done nothing more than exploit their once devoted customers and having to reluctantly and awkwardly apologize in the end. They subtly make changes for their internal benefits while shortchanging consumers ─ and believing (more like hoping) they will not take note. Those type of moves certainly impact the brand and image.

In the end: building the value of the brand diligently

When consumers are delighted by a particular brand experience, they begin to bond emotionally with the brand. They become loyalists and advocates – buying into it more often and recommending the brand to others. This behavior serves to build the brand’s reputation which in turn increases brand equity.

Transparency builds trust and loyalty – it’s what makes your audience believe you. The days when anything that was stated on ads was considered believable is no longer effective today. Social media is proving a fertile ground for breeding brand loyalty or where consumers can voice their frustration and dissatisfaction. George Orwell said something clever with his quote,” In a time of universal deceit, telling the truth is a revolutionary act.”

A Sloan Review article makes an excellent point by stating that “brand is a “customer centric” concept that focuses on what a product, service or company has promised to its customers and what that commitment means to them. Reputation is a “company centric” concept that focuses on the credibility and respect that an organization has among a broad set of constituencies, including employees, investors, regulators, journalists and local communities — as well as customers.

Brand equity caters to customers and prospective customers alike as it measures marketing success in building and maintaining customer relationships. Alternatively, corporate reputation relates to who can help or hamper a company’s capability to achieve its strategic goals.

Measuring brand equity consists of brand audits, brand evaluation and brand tracking all three conducted by brand experts trained in this specific area. Interbrand is a consultancy firm which does this and publishes its annual most valuable global brands listing.

Managing brand equity requires brand reinforcement (through brand awareness and brand image), brand revitalization (increase product use, entering new markets, adding brand extensions and line extensions, re-positioning and seeking new markets) along with a brand management crisis plan for timely implementation (as in acting swiftly to savage reputation, recover lost sales along with consumer trust).

The Blake Project, a branding consultancy firm, suggests in one of its articles (Rise of the First Responder Brands) “Of all the benefits strong brands offer it is time to add one more to the list:

  • Increased revenues and market share
  • Increased stock price, shareholder value and sale value
  • Increased awareness
  • Increased customer loyalty
  • Increased ability to attract and retain talented employees
  • Increased employee job satisfaction
  • Increased clarity of vision
  • Increased profitability
  • Decreased price sensitivity
  • Increased ability to mobilize an organization’s people and focus its activities
  • Increased ability to expand into new product and service categories
  • Additional leverage with vendors and retailers (for manufacturers)
  • Increased ability to organize effective disaster response and relief”

As for companies which place profits before their customers, an ideal illustration is the infamous pharmaceutical brand Mylan whose callous CEO, Heather Bresch, along with her executive accomplices sharply increased the price on their severe allergy EpiPen from about $100, when Mylan acquired the product in 2007, to approximately $600 which comes in a pack of two. This naturally caused a national controversy and public outcry. Following this development, Ms. Bresch hastily decided to reduce the out-of-pocket cost to patients but retained the skyrocketed list price. Shortly thereafter, the drug maker began to offer a generic version of EpiPen for half the list price of the brand-name remedy.

Due to its greed and short-sighted decision to increase pricing dramatically ─ most notably with a vital product it dominates, and whose principal acted in a condescending manner, the brand will suffer long-term trust and be scorned. Consequently, this may dilute the brand’s equity for some time. Incidentally, Ms. Heather Bresch heads the generic-drugs lobby and is the daughter of an American senator.

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The Challenger Brand: Going Up Against the Category Leader with an Alternative Product and Ethos

By James D. Roumeliotis

Challenger Brand

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The status quo is a complacent syndrome which exists with most established brands regardless of which sector they are categorized in. Despite a large capital chest, they are short-sighted, dull and lack the nimbleness to adapt swiftly. However, there those such as Nike and Amazon, among others, which innovate constantly. Nowadays, newbie companies fill in the gap and disrupt entire industries with revolutionary business models, products and services – whether in the service domain (think AirBnB, Uber and Netflix), automotive (consider Tesla) or in the consumer product domain (such as Dyson, Under Armour, Warby Parker and Hampton Creek’s Just Mayo brand).

The anatomy of the challenger brand

A “challenger brand” is defined as a company or product brand, whether a start-up or established, which faces up to the category leader in an advocacy stance. As a result, this type of brand/company is brusque to the point of creating and applying bold tactics. Furthermore, it is distinct and emotionally driven to be able play from a position of strength behind the dominant player in its sector. Consequently, the challenger brand eagerly takes on a unique position and showcases with conviction, to its target audience, why it is the logical alternative to the segment leader. Unique features offered may include enhanced features and benefits from those offered by the category leader. These may include better materials, technology, functional and attractive design, craftsmanship, performance, above average service, better value for the money, as well as social responsibility to name a few. This works well with consumers who are either under-served or under-valued by the leading brand.

Uber, with the birth of the ride sharing app, came along and challenged the taxi domain through a paradigm shift. It took the taxi leagues worldwide by storm which got the cabbies up in arms and resulted with them protesting and asking their local government to legislate against their nemesis. Rather than looking inward and reforming to compete, the cabbies chose the path to ferociously protect their precious monopoly. One taxi trade magazine even printed a column that condemned Uber as a “corporate pariah,” a “malignant tumor,” and a “giant octopus” that has “spread its tentacles globally.”

A challenger brand is determined to persist and persevere to constantly make a point to undermine the leading standard in order to change the rules to the benefit of the customer.

How to outsmart the category leader

When the challenger brand does not have the marketing budget to go head-to-head with the established brand in its category, it is easy to see why the latter can fail. To overcome this problem, the challenger creates unconventional marketing tactics which are more effective than traditional ones with much less ad spending. Sometimes that advertising is giving jabs to the weakness inherent with the category leader and it can include clever yet subtle messages which, if effective, may be able to persuade consumers who were leaning toward the established brand that it is not all that great as always thought.

Advocating and standing for something compelling, such as Patagonia with its social responsibility mission which is: “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.”  The idea is to make a strong emotional appeal about the changes they seek to make a difference with. It is demonstrating and personifying not only through mere words but also with deeds that they are a better alternative to the incumbent brand. This takes being and acting confident through passion, beliefs and a purpose against the norm in return for something that matters.

Jude Bliss, the editor of the online blog The Challenger Project, had made this noteworthy statement: “Challengers are as clear about what they are rejecting as they are about what they are championing, which involves clearly defining what you see in the current market that is broken, as well as what change you can bring.”

It does not matter whether you are a new and small brand or the largest. Everyone can partake as a challenger brand. As long as your largest competitor defies with your ethos, then you have a cause for a challenge. No better example of this than Apple vs Microsoft with their witty advertising jibes at each other as to whose PC is the smarter choice for the user.

Another tactic to use as a challenger brand, if you are in the consumer goods domain, is to be creative and stand-out among the crowd with exceptionally designed yet functional packaging. Taking away the bland and ordinary and making the product desirable. Consider what Toblerone chocolate, Veuve Cliquot champagnes, SKY Vodka and others have succeeded in doing which eventually spiked their sales.

Audi has taught other brands how to challenge

BMW and Mercedes Benz are two German premium leading auto brands which command an equal level of prestige and respect. Both are in the same league in terms of German engineering and precision. However, each has a distinctive style which distinguishes it in the target audience – younger who prefer dynamic driving and older demographic with preference for a luxury drive respectively. As regards to Audi, up until the several years ago, the brand was deemed as the awkward stepchild of the parent VW group — the Toyota of the German elite of sorts. Lately, Audi has stepped up its game and finally entered the world as a true competitor along with their German tagline exuding what they stand for: Advancement through Technology. Audi has been gaining on its German rivals. Its firm commitment to excel has brought Audi to an audacious position to vigorously challenge its opponents BMW and Mercedes.

In 2009 in a busy Los Angeles, California intersection, a billboard ad rivalry between what Audi initiated and with BMW responding had escalated to a new level. A tit-for-tat had ensued when Audi placed an image of the all new Audi A4 along with the headline: “Your move, BMW”. Santa Monica BMW, a local dealership, took on the challenge and entered a virtual chess game when it added a billboard not far from Audi’s which featured a photo of the BMW M3 with the counter punch, “Checkmate.” A few days later, Audi unveiled a new billboard to replace the one with the A4. It featured an R8 super-car and read: “Time to check your luxury badge. It may have expired.” In the end, BMW moved its billboard to some other place and the billboard ad war came to an end.

Audi and BMW Billboard Challenge 1

Audi and BMW Billboard Challenge 2

In a Brand Channel blog interview with Loren Angelo, director of marketing for Audi of America, has said that “As a challenger brand, you have to look at your category, your situation…and attack it head-on.” He further elaborated: “We need to continue to challenge. That’s what allowed us to drive our position and to turn the brand around beginning in 2008. A challenger brand doesn’t mean we only challenge the competition, but we communicate how we challenge the status quo and challenge complacency in our industry and in culture.”

That being said, as a challenger brand, constant and persistent messaging with conviction to the target audience ought to be applied along with the delivery of unique customer experiences to solidify brand loyalty.

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Three Things Businesses Can Learn from the Late Prince, The Artist

by James D. Roumeliotis

Prince Logo

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Prior to his sudden demise, I always had quite the fondness and following for Prince, “The Artist.” Ever since I discovered his music in the late 70s, what never seize to amaze me since was his eclectic work (comprised of dance, funk and rock tunes), vocal range and the method in which he always managed to integrate it all seamlessly during his formidable stage presence.

However, what many may not have been aware of was his show business acumen. Prince built and sustained his personal brand along with the resources he exploited which comprised of his musical entertainment enterprise.

What I have learned from this beloved and prematurely departed artist are three lessons which any business can use as a takeaway for implementation. They are as follows:

1) Stray from the ordinary and remain relentlessly competitive

“The Artist” was widely acclaimed by his fans, the media and fellow musicians as one of the most influential and creative musicians of his generation. He seemingly left behind an impressive music legacy. Unlike most artists, Prince was a prolific songwriter, multi-instrumentalist, sang in a variety of vocals, produced his work, as well as displayed dance and theatrical antics on stage. Must we forget that he was also an actor ─ most notably in “Purple Rain” along with performances in four other movies including on television. Moreover, he wrote songs for and produced work for other musical acts including some he impacted and/or for whom he acted as their mentor and coach.

Prince also knew how to outdo his competition by standing out with his artistic performances including the eccentric outfits he sported along with his leaping dance acts he displayed with his platform shoes ─ as he only stood at 5’2”/1.58m. Some of his singles, which eventually turned into big hits, were purposely targeted at some of his rivals.

An exemplary display of Prince’s unique and memorable performance was a video, recorded at the 2004 Rock and Roll Hall of Fame induction ceremony. The illustrious artists playing the Beatles’ “While My Guitar Gently Weeps.” include George Harrison’s son Dhani, along with old band-mates and collaborators Jeff Lynne, Tom Petty and Steve Winwood. However, most striking among this band, who stood slightly apart from the rest while they played ordinarily, was Prince. Despite his small frame and wearing a dark suit with a red shirt, a matching derby hat, and staying on the sidelines for the first 3:27 minutes or so (in the YouTube recorded video), he suddenly steals the show with his passionate guitar solo. As the song ends, Prince abruptly takes off his guitar, tosses it in the air and then disappears off stage. That was probably the most memorable part of the video from my perspective. Many more who watched it share the same sentiment.

2) Branding, image and reputation are your equity

As with traditional businesses, Prince had created a personal persona – where the brand and performer were synonymous. He created a logo dubbed the “The love symbol” ─ one that blended the symbols for male and female which was instantly recognizable. It was also the shape of his customized guitars. Prince even owned a signature color in the mind of his followers – purple. His occasional provocative lyrics, seductive singing, dramatic performances and distinctive album covers all depicted a unique style as an icon and as a showman of his personal brand.

As one Twitterer remarked in his Tweet following Prince’s death,Prince built a brand around his music and his genius before content marketing and personal branding became a thing.” Another stated, “Like Bowie, Prince reminded us that it’s not just OK to be weird—it’s cool to be weird.”

The moral of this narrative is that as a business, follow what Prince did ─ by working on building your brand image consistently, by establishing unique features with your products/services that distinguish them from the competition, and by being true to yourself, as well as by what you truly stand for.

3) Become vertically integrated

Prince was more than an artist, he was one who only entrusted himself with songwriting, arranging, producing, naturally performing his own music, as well as distributing it through his own label (NPG Records and Paisley Park Records before it). To do so, he built a $10 million state-of-the-art complex in a suburb of Minneapolis, Minnesota which he named Paisley Park Studios. That said, he became his own vertically integrated corporation. This was, after all, a multi-talented musical artist who believed in taking control of his own destiny and in return, earning the maximum revenue and profits rather than giving much of it away – most notably to a record label. He considered the role of record labels exploitation and slavery. He was a fierce advocate for artist rights and independence and in he had standoff with Warner Bros., his label at the time. In protest, Prince removed his name from his album releases and changed his name to a symbol. He also styled himself as “The Artist Formerly Known as Prince.” Furthermore, during a legal battle with Warner Bros., he scrawled the word “Slave” on his face during his appearances and performances.

The significance with this illustration is that a business with adequate capital, resources and expertise ought to consider amalgamating most or all of the processes under its own umbrella. A such, quality control and improved profits are now controlled by the business itself.

Paisley Park Studio

Paisley Park Studios

A final point of intrigue

On a noteworthy footnote, in his 37 years as an artist ─ and unlike many with his fame, he kept himself out of the negative spotlight. He never plagiarized a fellow artist’s work, never had to hire a ghost writer, and neither involved in a scandal which would drag him to the courts. In the end, he was capable of playing more or less 20 instruments admirably and having earned 19 Platinum albums, 6 gold albums, along with a double diamond record for his Purple Rain album which sold 21 million copies. Impressive for a personal brand to say the least.

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Consumer Packaged Goods (CPG) Marketing Tactics: Spending Less and Generating More Exposure & Revenues

by James D. Roumeliotis

Hexagon Honey Packaging

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When it comes to marketing food products, known in industry jargon as “Consumer Packaged Goods (using the acronym “CPG”), it takes more than mere advertising. Any brand with a deep advertising budget can do so. However, the skill is in knowing how to best utilize a limited budget for maximum effectiveness. Surprisingly, many smaller brands seem to be running circles around their much bigger brand counterparts with greater resources. The key differentiator is in the strategy and implementation including the ideal target market, brand positioning and specific media sought.

Guerrilla marketing: Getting noticed on a shoestring budget

Persuading consumers to consider your product on their shopping list takes time and an ample marketing budget. However, getting consumers to take notice of your product can be swift if a combination of Guerrilla/unconventional marketing tactics are used in conjunction with unique packaging design.

The term “Guerrilla marketing” refers to an unconventional and bold approach for a business to promote its products and/or services in ways that capture the attention of potential customers. They are creative, memorable, attract people’s attention (some may be controversial) and require a limited budget which makes it ideal for small to mid size businesses. “Guerrilla marketing” was originally coined in 1983 by Jay Conrad Levinson who also wrote the book “Guerrilla Advertising” with subsequent editions and derivatives which followed.

In keeping with the CPG theme, Nestle’s Kit Kat candy bar brand utilized Guerrilla marketing by placing creative candy-themed benches across large cities as the image below depicts.

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Today, if a brand, especially a new arrival on the market, wants to stand-out in a crowded marketplace, it ought to consider the following means and tactics.

Online/digital Content marketing: This is absolutely the medium/platform which should not be overlooked. Even large brands are placing more emphasis with digital in their integrated marketing strategy. Content is released frequently but in small doses utilizing Twitter, blogs, Linkedin etc. along with stunning lifestyle images and video with must view material (Instagram, Pinterest, Facebook, YouTube, Vimeo to name the most prominent digital venues).

Public Relations: As this is earned media, what is stated about a brand from a third party is considered trustworthy. Creating buzz through the media, including the use of press releases, is an inexpensive way to earn publicity in lieu of traditional advertising spend.

Alliances – associations – sponsorships: These are additional considerations to boost exposure which turns-out to be a win-win for both parties (sponsor and sponsored party/ beneficiary).

Storytelling: A brand should include storytelling which places an emphasis on the brand’s heritage, the reason for being and why it is offering such a product or products. It is more than content and a narrative, it is a picture made up of feelings, facts and interpretations.

Food packaging: Eating with our eyes

The value added in design, craftsmanship, branding and overall quality can elevate a product into an epicurean delight. Clever and innovative design significantly increases sales and improves brand performance. In addition, it can do plenty of silent marketing. Consider Toblerone, the Swiss chocolate bar brand, whose distinctive yellow triangular packaging and equally shaped product inside is instantly recognizable. It undoubtedly portrays a premium product yet offers a good value for the price. The brand’s marketing spend is much less than its competitors, though its sales and profits are known to be exceptional in its category.

There are many ways of seeing the value of design. For instance, you can measure sales and relative value as an output of changes in design. Design can also improve your standing among rivals and give you a competitive advantage. The Design Council published a report where facts and statistics concerning the value of design are highlighted. One interesting statistic is that design conscious businesses can expect a return on their internal design investments as high as 125%. That’s quite an impressive return compared to other types of investments made in a business.

What may be obvious is that if you have high quality design, you do not need to compete with your competitors on price. If the design of a product packaging has a “wow” factor to make it stand-out on the shelf, then consumers will choose it even if the price is slightly above the competing products. If the product inside is as good as its packaging, customers will enjoy what you have to offer and continue to be loyal to your brand. That is the result of offering something unique and of a higher standard.

Lifestyle marketing: Non-traditional methods to reach modern consumers

Generally speaking, a brand that is designed for a lifestyle should have a much higher emotional value to consumers than one based solely on features, benefits and cost. A study from the Kellogg School of Management revealed that brands serve as a means of self-expression along with the limitations of expressing a consumer’s identity through brands. The goal of a lifestyle brand is to become a way that people can utilize it to relate to one another. Those brands are an attempt to sell an identity, or an image, rather than a product and what it actually does.

Two CPG brands which have joined the lifestyle bandwagon and spending more money and resources away from traditional marketing are Oreo and Red Bull. The former has created one article and image on the pulse of pop culture per day for 100 days with not much revealed of what would come next. Red Bull which spends a staggering 30% of its revenue in marketing and sponsorship events, has also launched a magazine with over five million subscribers, including a record label and two film studios to produce its lifestyle and experiential material.

Healthy eating and acquiring new tastes are modern day trends which can’t be ignored by CPG marketers. Smaller portions are also a recent trend which equate to less calories for consumption along with much focus on natural and non-GMO ingredients.

Creating new categories and uncontested market space

Instead of competing head-on in the same product category, as the majority of brands are accustomed to, consider creating an entirely new class which will be in an uncontested marketplace. This approach is known as Blue Ocean Strategy®. It was developed by two professors at INSEAD, W. Chan Kim and Renée Mauborgne who are also co-authors of Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant (Harvard Business Review Press). As they put it, they observed that companies tend to engage in head-to-head competition in search of sustained profitable growth. Yet in today’s overcrowded industries competing head-on results in nothing but a bloody “red ocean” (as in cutthroat competition turns the ocean bloody red) of rivals fighting over a shrinking profit pool. Lasting success increasingly comes, not from battling competitors, but from creating “blue oceans” of untapped new market spaces ripe for growth.

Blue Ocean Strategy Chart

An intriguing case study which puts the above strategy in perspective is Australia’s Casella Wines. In 2001, it entered the overcrowded and highly competitive wine industry in the U.S. with its Yellow Tail brand. By the end of 2005, it had reached sales with 25 million cases ─ achieved on a limited marketing budget. This triumph placed Yellow Tail in the category of the overall bestselling 750ml (25.4 U.S. fl. oz.) red wine, outstripping Californian, Italian and French wine brands. It accomplished this by applying the Blue Ocean strategy framework. Consequently, Casella Wines’ Yellow Tail brand targeted the beer and ready-to-drink cocktails in the U.S. market and created Yellow Tail to be easy drinking, an informal selection, fun and an adventure ─ in essence, an uncomplicated, fruity wine structure that was instantly appealing to the mass of alcohol drinkers.

A category which should not be ignored are Millennials (aka Generation Y). They are projected to spend $65 billion on consumer packaged goods (CPG) over the next decade, yet there are many misconceptions and challenges in reaching these shoppers, according to a white paper by WPP’s Geometry Global. Millennials are the largest generation since the Baby Boomers. They are known to be quite sophisticated, technology wise, unaffected by most traditional marketing and sales pitches. As a result, CPG companies should adjust and innovate to stay digitally connected with the Millennial consumer.

Sensorial branding: Exploiting the senses

In keeping with the spirit of the five senses, you can exploit them entirely to create a favorable experience in synergy, for guests and clients alike. Below are some of the most important factors:

SIGHT – choice of packaging, its design along with its images, the font type and colors. Add to that a stand-alone point of purchase (POP) display.

TOUCH – the feel and ergonomic design of the packaging. This is how the consumer interacts with it. Plenty of emphasis should be placed on this when designing the package.

TASTE – finding the perfect balance between sour, salty, sweet, and bitter. Food product samples ought to be available as consumers would prefer to try a product they are exposed to for the first time. Presentation is equally important which has an impact on the overall image of the setting.

SMELL – it is all about the smell of the product. This sense is closely linked to emotion and memory. You can use something like computer controlled scent machines to entice. Sensory technology can be very influential down an aisle. Case in point: a French bakery café can deliberately use ventilation to deliberately spread the smell of roasted coffee and baked items sold to induce clients to make or increase their purchases. A company which is known to furnish such state-of-the art equipment is Scent Air Technology.

By integrating the brand-building strategies to appeal to all, or most of the senses, sales have actually increased.

At the end of the day

Marketing done well can improve your brand’s awareness, lead to more sales, word-of-mouth, as well as gain client loyalty.

Using clever marketing approaches which do not cost a fortune, along with innovative and attractive packaging, can lead to impressive sales. However, to develop repeat purchases (think “sell-through” at the retail level), the product itself should taste good and produced with quality ingredients.

Stay in touch with your customers via social media interactions and occasional email newsletters and a blog. Do what you can to improve the lives of these people with valuable advice and special offers. The product should exude that it occupies a part in a pleasant lifestyle.

Remain true to what is making your CPG brand a success and refuse to become complacent. Keep refining, innovating, never mislead (through false benefit claims and nutritional information) and engage constantly with your loyal clients. These activities are not deemed a onetime event but rather an on-going process.

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Genuine Luxury vs Accessible Luxury: Two Distinct Yet Opposing Categories

By James D. Roumeliotis

Mass - Masstige - Prestige

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“Masstige” (a combination of two words: “mass” and “prestige” – aka mass with class) is a contemporary marketing term which denotes prestige for products perceived as luxurious and targeted to a wide range of customers known as the “mass affluent.” As per Wikipedia, the mass affluent are the high end of the mass market, or individuals with US$100,000 to US$1,000,000 of liquid financial assets, or consumers with an annual household income over US$75,000. These upper middle class individuals can afford to splurge on some of the finer (and affordable) things in life which include fashion merchandise, sporting goods, cosmetics, various accessories (silk ties, scarfs, small leather goods, perfumes etc.), high-end consumer electronics/gadgets, as well as culinary food and spirits. Brands in those categories depend on the “masstige” crowd for a majority of their sales, despite a few which also happen to be purveyors of inaccessibly priced products catered to the HNWI/UHNWI (aka the very wealthy or the 1% respectively).

This is purely an oxymoron and paradoxical since in the authentic luxury domain, “mass prestige” is an artificial term for “luxury” as it is not generally geared for the mass but rather the well heeled. Sadly, the true meaning of “luxury” has been bastardized by many brands who are falsely in the “luxury” business (in the true sense of the word and definition). ​However, there are luxury brands which have chosen to offer lowered priced products in a bid to join the “accessible luxury.” Think Coach with its leather bags and accessories or Chanel with its perfumes and cosmetics.

Defining the true meaning of the term “luxury”

Definitions of “luxury” vary significantly and depend on with whom you discuss the topic and in what context. The term “luxury” is not the easiest to define. It is relative, mysterious and elusive. In essence, it revolves around subjective criteria in the mind, which creates a mood and what is generally referred to today as lifestyle.

Gary Harwood at HKLM, one of the founders and directors of a leading strategic branding and communication design consultancy, stated:

A luxury brand is very expensive, exclusive and very rare – not meant for everyone. When it ceases to be these things, then it’s lost its exclusive cachet. Commoditizing luxury brands and making them more accessible to the middle market puts them at risk of becoming ordinary, common and less desirable. And the more available a brand is, the less luxurious it becomes.”

Authentic luxury brands compete on the basis of their ability to invoke exclusivity, prestige and hedonism to their appropriate market segments not the masses. There is a classic litmus test as follows:

  • Is the product manufactured in artificially limited quantities? (i.e. the rarity factor)
  • Does the firm have a story to tell? (i.e. history & pedigree)
  • Is the firm portraying a unique lifestyle? (i.e. the product or service will enhance one’s experience through an exceptional appeal)
  • Is craftsmanship the hallmark, which delivers products that only High Net Worth individuals (HNWI/UHNWI) can purchase without question?
  • Does the brand offer authenticity?

Genuine luxury purveyors remain relatively small and select in their category. Ultra wealthy (UHNWI) consumers purchase rare luxury products because they seek to distance themselves from the mass through the emotional value of acquiring flawless and rare objects of desire.

“Aspirational” luxury, on the other hand, is another fancy marketing parlance which is generally defined as a brand that most want but only a fraction of them can actually afford it. Most cannot afford a $2000 bottle of vintage wine but may be able to occasionally splurge on a $200 bottle of one of the finest single malt Whiskey.

Identifying luxury sectors

Genuine Luxury is classically defined in three key segments:

1) Luxury Goods: Fashion & Accessories, Watches & Jewelry, Well-being & Beauty products.

2) Lifestyle Purchases: Automotive, Experiential Travel, Home & Interiors, Exclusive Alcoholic beverages (exceptional wines, champagne & spirits)

3) Private/Executive Jets and Yachts: An absolute category in their own right.

Brands which fittingly claim authentic luxury status

Few brands can really claim the trademark of luxury. It is those which combine allure with pedigree and quality attributes. Discounting is not part of their strategy and their entire raison d’être is geared to the UHNW (Ultra High Net Worth). Many of their products actually increase in value over time since they are either discontinued or necessitate a long waiting list/time.

Most notable authentic luxury brands are in the haute merchandise category:

Hermes, Chanel, Louis Vuitton, Bottega Veneta, Rolex and Cartier.

Other players to this core list include: Bentley, Rolls Royce, Gucci, E. Goyard, Charvet, Salvatore Ferragamo, and Bulgari.

Exclusive and bespoke travel companies provide tailor made adventures and excursions. The four key players in this category include: Abercrombie & Kent, Kuoni, Orient-Express and Cunard Line.

Broadening our view of luxury services, certain firms offer services and privileges to a rare percentile. Such services include credit cards with no limits, jet ownership, private plan charters, global concierge services and the like. Think NetJets and Amex.

“Accessible” luxury is a marketing notion, not a merchandise category

The concept of making luxury available to the masses goes against what true luxury is as
there is no such thing as accessible luxury ─ it is either luxury or it is not as “accessible” luxury is a marketing notion and not any product category. Think Michael Kors, Coach, Ralph Lauren, Godiva and Apple among others. Top luxury brands such as Hermes, Louis Vuitton and Chanel have accessible luxury with perfumes and cosmetics, sunglasses, as well as accessories (leather, silk scarfs etc.).

In marketing parlance, being coined as an “accessible” luxury good can be deceiving when the quality of materials is not quite at par as one would normally find in a “genuine” luxury product. For such companies, becoming too commonplace is a risk for such brands as they lose their cache due to a lesser price line, as well as risk their reputation for the sake of increasing their revenues. Then there are some non-luxury brands which use the codes of luxury strategy to grow their sales. Needless to say, many consumers will eventually catch-on that such products are merely a gimmick thus on their way to lose their luster.

Masstige - My other bag is a Birkin

“Premium” and “prestige” categories defined

If luxury brands are related to scarcity, quality and storytelling then premium goods, on the other hand, are expensive variants of commodities in general: i.e. pay more, get more.

These brands are less ostentatious, more rational, accessible, modern, best in class, sleek design, and manufactured with precision. Beats headphones and TAG Heuer watches are a case in point and so is Audi and Lexus in automobiles.

“Luxury” and “prestige” brands respectively both have a similar status. Although some may disagree, in some cases, brands such as Mercedes-Benz automobiles, are considered to be both “luxury” and “prestige.” There are also brands which are either labelled one or the other. It depends how they are identified in the eyes of consumers.

Prestige brands offer a high level of innovation, craftsmanship ─ and with some categories, the finest ingredients or raw materials. Due to their well-established names, status and pedigree, they boast quite a loyal following. As a result, they can command premium prices which their clients do not mind paying for since they are made to feel special. Examples of some prestige brands include Breitling watches, Lancome cosmetics and Aston Martin automobiles.

The distinction between a prestige brand and premium brand is simply one of perception. In automobiles it is Cadillac and Lexus vs their German counterpart of BMW and Audi. In watches, it is perhaps a Rolex versus a Breguet and a Cartier.

On a final note

When it comes to lower priced supposed “luxury” products for the affluent masses, they are essentially “premium” products ─ otherwise known as “masstige.” The brands succeed at creating fancy designs and utilize expensive looking material to make their products appear very expensive which are then sold at a fraction of the price compared to genuine luxury brands in the same product category. Add clever window dressing and marketing and the result is that those products become affordable objects of desire. Unlike authentic luxury brands which are manufactured at their country of origin (mainly Italy, France or the U.K.), they are outsourced to low labour cost factories in Asia or Turkey. Despite this, they are given a premium markup which is intentionally done to create an aura of high value.

As long as there is a big demand for massitige products that its target market can afford and make them part of their social status and lifestyle, the category will be around indefinitely.

As a final point worth mentioning, at this day and age, there are luxury branding experts who claim that there are actually four categories of luxury: Old, New, Eco and Indie as exhibited in the following table (credit: David Sherwin). This translates into additional choices ─ categories to satisfy most desires.

Four Types of Luxury Chart

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The Top 10 Most Read Articles in this Blog for 2015

by James D. Roumeliotis

Top 10 Articles for 2015

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As in every year, I have once again rounded up the ten most read/popular articles — this time for  2015. The following ten captured the most attention by numbers and from 154 countries in all. See them all below in descending order.  Your views are always encouraged including subject matter you think I should be covering more of.

THANK YOU for your readership and I look forward to feeding your mind with much more business practical food for thought this year which can be applied for timely results.

1 Luxury vs. Premium vs. Fashion: Clarifying the Disparity

2 Perceived Quality: Why Brands Are Intangible

3 The Art of Selling Luxury Products: Brand Story Telling & Persuasion

4 Mass Customization & Personalization: The Pinnacle of Differentiation and Brand Loyalty

5 Exceeding the Hotel Guest Experience: Anticipating and Executing Desires Flawlessly

6 Brand Awareness: the influence in consumers’ purchasing decisions

7 The Ultra Luxury Purveyors: Lessons from brands catering to the richest 1 percent

8 Identifying and Catering to the Discerning Consumer: Quality and Service Above All

9 Start-up Essentials: A Universal Roadmap for Starting a Business — Infographic

10 Product Features vs Benefits: The Brand Differentiation

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The Authentic Brand: A Precious Asset Developed Through Transparency, Customer Experience and Ultimately, Loyalty

by James D. Roumeliotis

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Honest by ad. A pioneering company launched in January 2012. The company is unique in communicating about the supply chain of its products and pricing.

Honest By ad. A pioneering company launched in January 2012. The company is unique in communicating about the supply chain of its products and pricing.

Trust is a hard thing to come by these days whether between people or between people and brands. When the founders of a start-up build a brand from the ground-up or the executives of an established one are in modus operandi mode, taking a cautious approach to their brand image, in both scenarios, ought to be part of growing and preserving the business with a constant eye on the future.

Sadly, nonsense, and plenty of it from ubiquitous brands, is probably the best noun to describe what consumers are offered by many companies selling their products and services to them. Whether it is advertising, package labeling or an overstated pitch by their sales staff, the information presented may be deliberately misleading. With some brands, it is the tiny print in disclosure statements which defeat what is promised in larger and bold advertising headings. The majority of consumers do not read small footnotes. Think of the worst offenders of this practice: the cellular phone/telecommunication providers, insurance companies, credit card providers, as well as the automobile manufacturer promotional offers and pharmaceutical advertisements – to name a few.

Deception concealed as sincerity: How to chip away at your brand

The key to a successful business growth, along with reputation, is truth in advertising, delivering on promises made, avoiding deceit – and marketing the brand, not the product. Contrary to popular belief, a brand is not a logo, label or product but rather a relationship with customers. It is a promise. Branding, when carefully executed, adds value to a company including brand equity. This is considered intangible brand value. By applying a short-term revenue and profit strategy at the expense of long-term negative consequences, a business’s brand reputation will ultimately lose its luster.

In the 2015 Harris Poll Reputation Quotient®, published the reputations of the 100 most visible companies among the U.S. general public. What appears on the top five, among other notable brands as consumers perceive them, are Wegmans Food Markets, Amazon, Samsung, Costco and Johnson & Johnson respectively.

Consumers have high and explicit expectations from brands, thus anticipate what the brand promises via its marketing material and/or what is stated on the product packaging. What a brand actually delivers and how it behaves in the process is what consumers get to feel.

A brand which utilizes short-term sales and marketing tactics for quick short-term gain fails financially in the long-term by acting in an ethical way. As marketing maven Seth Godin rightfully proclaims, “In virtually every industry, the most trusted brand is the most profitable.” As with our personal lives, trust with branding is based on what one does, not what one says.

Boosting sales and market share via misleading and deceptive tactics

According to a 2013 Harris Poll, regarding the most and least trusted industries, the advertising industry was near the bottom of the list when rated up against many other business sectors. Seemingly, truth in advertising is a misnomer. Misleading and deceptive advertising by many marketing and branding executives, give the entire industry a negative perception.

The food processing domain is no more honest with labels that claim to be healthy but without support with any concrete scientific facts. Food companies tout their devious label claims of organic, nutritious etc. – although an absurd amount of sugar and/or sodium is present in the ingredients along with unnatural artificial ingredients). Kelloggs even went as far as having to be ordered, by the courts, to discontinue all Rice Krispies dubious advertising which claimed to boost a child’s immunity system.

Then there is the “premium” orange juice from popular brands such as Tropicana, Simply Orange and others which are highly processed, and usually stored for several months before reaching consumers at the supermarket fridge aisles. This processing method is used to retain the juice from spoiling. However, during that process, it also strips the flavour which is injected back into the product, once it finally gets packaged, to give the juice its original orange flavour. Not surprisingly, the orange juice producers do not make any reference to this anywhere.

Informative and authentic eye-opener documentaries such as Food Inc. and Tapped have upped the ante in terms of the exposure shared with the public to what is wrong with the food processing/food chain and water bottling sectors respectively. Moreover, the GMO debate with the exceptionally well-connected and deep pocketed Monsanto (the St. Louis-based biotech giant and world’s biggest seed seller) will not be going away any time soon.

Other industries notorious for deceit are banks and cellphone/telecommunication companies with their hidden fees. These blatant revenue generators are sales at any cost – short-term gains, of course. These companies guilty of gouging seem to be testing the limits with consumers – as if the latter are ignorant. Those absurd fees evidently enrage the culprits’ customers.

Employees reflect the brand

First and foremost, trust begins with company employees. If they are well trained and treated with respect and transparency, the employees will trust their employer and radiate their enthusiasm, as well as loyalty to their customers by going the extra mile.

Along with a brand being a valuable asset for any business, people also fit into the equation as an important asset. This is where hiring the right people, on-boarding them, training them adequately and empowering them all create a positive impact on customer satisfaction.

Many brands are myopic to the point that they unintentionally and unknowingly allow their dissatisfied customers to go away without a thought. Front-line staff is either not trained properly and/or lacks the proper attitude to handle clientele appropriately.

During the industrial era, consumers would simply purchase what was produced, shopping where that product was available and paying the price the retailer demanded. In essence, the manufacturer and the store were in position of strength. As products and consumers have changed over the years, the concept of ‘brand loyalty’ and ‘consumer insight’ came about. As we progressed into the new millennium, the transparency and unrestricted information available on the internet has changed all of that. Today consumers are not only better informed but they are also in control. They can make or break a brand through their actions. So what does this say about listening – and acting?

Consumers will no longer refrain from informing companies on what may have gone wrong ─ whether it’s a particular brand or a competitor’s. With the numerous platforms for consumers to make their voices heard online, brands have to be very reactive and not allow anything to chance. In an age when the consumer’s outcries and influences spread quickly, the results can signify lost sales and a deterioration of brand loyalty.

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When all is said and done

Building and nurturing a brand is what makes an enterprise gather wind under its wings. Common intelligence dictates that the way a customer is dealt with reflects on the integrity of the brand, and the image of the company in the mind of the consumer.

A “Brand” is a promise of something that will be delivered by a business. This promise comes in a form of quality, an experience and a certain expectation in the mind of the consumer. It includes the Unique Selling Proposition (USP). Marketing, on the other hand, is about spreading compelling messages to your target audience while branding is a combination of words and action. Marketing is extroverted and communicates quickly, while branding is introverted and a slow process if it’s to produce any real impact. Effective marketing activities are vital in developing a brand. When combined successfully, branding and marketing create and promote value, trust, loyalty and confidence in a company’s image, products and services.

According to an Edelman’s Trust Barometer, it was revealed that 77% of respondents refused to buy products from companies they distrusted. More disturbing is that 72% said they had criticized a distrusted company to a friend or colleague.

When customers are treated with honesty and delighted by a particular brand experience, they begin to bond emotionally with the brand. They become brand loyalists and advocates – buying the brand more often and recommending it to others. This behavior serves to build the brand’s reputation. This approach is priceless –even though it may take longer to take positive effect.

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Education Branding: Adding a Distinct Personality to an Institution of Learning

By James D. Roumeliotis

Cleverbox, UK - integrated school branding example

Cleverbox, UK – integrated school branding example

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When we think of brands, we mainly think of companies. It is not often that we think of educational institutions. However, with competition amongst them, whether in the private or public sector, many have begun considering its importance and value. As a result, they are developing and implementing branding strategies so as to distinguish themselves. Branding is a powerful differentiator and creates top of mind with prospective students who are considering where to apply for college, university or a vocational/trade school/polytechnic institute. Private elementary schools and high schools also play into the equation but with the parents of the students primarily targeted.

As personal branding has become ever popular over the years – most notably for professionals in the job market, as well as practitioners in private practice (consider physicians, attorneys etc.), post-secondary schools in particular are also taking branding earnestly in consideration. To name a few that undertook a branding project at heart, and as a result have become renowned, are Babson College in Babson Park, Massachusetts, which describes itself as “immersed in business, engaged in liberal arts” and the Rensselaer Polytechnic Institute in Troy, N.Y. with its tagline, “Why not change the world?”. The for-profit institution of higher learning University of Phoenix, in Phoenix, Arizona, boasts its innovation in higher education which helped pioneer many of the conveniences that students now enjoy — evening classes, flexible scheduling, a university-wide academic social network, and an immersive online classroom which it has been offering for nearly 20 years.

As one would expect, educational institutions target diverse markets worldwide via their various programs offered. This makes their marketing messages all the more challenging.

Understanding privileges of Ivy Leagues

Pedigree, along with established high standards, unmatched curriculum, elite professors and lecturers and prestige, compel the Ivy Leagues’ inclination to seek only the top students for entry in their programs. Fewer than one out of ten students are usually accepted at Harvard, Stanford and Princeton for example. Prestigious and sought after colleges, trade schools and high schools can also be counted in following similar ranks holding on to their place in the top echelon which are also reflected by their exorbitant tuition fees. Parsons School for Design in New York City, the Career Training Academy in Pittsburgh (Pennsylvania) and The Lawrenceville School in Lawrenceville (New Jersey), respectively, have their own stringent criteria so as to retain their stellar reputation and cache. It is hard for the public schools to make such claims. This phenomenon is also driven by the plethora of applications received but with limited available places. It can also be stated that artificially set low admission quotas is vital to retain the brand prestige ‒ akin to authentic luxury brands production limits.

As a side note of interest, Ivy League universities have the most loyal, as well as wealthy alumni which contribute large sums of money as indicated by the universities’ vast endowments. By the end of fiscal year 2013, U.S. News’ three highest-ranked National Universities were Yale, ranked No. 3 with more than $20.7 billion in endowment monies, Harvard University, ranked No. 2, with nearly $32.7 billion, and Princeton, ranked No. 1, had nearly $18.8 ​billion.

Branding through emotional attachment and the total student experience

As universities and other educational institutions are having to confront challenges such as student enrollment, rising tuition fees, third party school rankings, and disruptive online course offerings such as Massive Open Online Courses (MOOCs), their distinction and relevance, amongst their rivalry, is in dire need of a jolt.

For starters, many institutions lack a target segment and a strategy on how they intend to reach it. Education is a knowledge service, thus a school’s campus facilities reflect its identity, whereas its teaching staff, administrative people, board members and alumni are a significant brand asset.

Branding is critical for success in any organization. It begins with the idea of what the organization will be perceived as. What do you want it to represent? What do you want your learning center to stand for? What type of image are you aspiring to portray? What type of students are you seeking to attract?

This brand promise comes in a form of quality, an experience and a certain expectation in the mind of the consumer ‒ in this case it’s the student. The brand should include the Unique Selling Proposition (USP), positioning (What should the brand stand for among its target group?), personality (Traits the brand possesses that consumers/students can relate to) and define the entire organization by touching every aspect of it. Those are crucial factors that will make it truly unique. Successful branding methods and results can also get the organization out of the commodity trap and attract value in terms of higher tuition fees ‒ or at least justify the value of existing fees. 

Articulating what the brand stands for and why it is better than the competition, is where a brand communications strategy and execution come into play. Commonly used methods of brand communications include advertising, events, sponsorships, promotions, direct marketing, customer relationship management programs and public relations.

When students are delighted with their on-campus experiences, they begin to bond emotionally with the school. They become brand loyalists and advocates – transacting with the brand more often and recommending it to others. This behavior serves to build the school’s reputation.

Key points: a university with a well-respected brand has an enormous advantage

An article in The Guardian newspaper’s blog entitled, “What’s in a name? The value of a good university brand”, includes questions such as “In this rapidly changing marketplace, university branding is about much more than logos. But what does this mean for students and the role of branding in higher education in general? These queries formed the basis of a recent Guardian roundtable, held in association with brand communications consultancy Purpose. The debate was conducted under the Chatham House rule, which allows remarks to be reported without attribution to encourage a frank debate. Consequently, the discussion produced recommendations compelling enough that they should not be overlooked.

The roundtable heard that universities looking to brand themselves successfully should:

  • Focus on their core values, such as: academic integrity that links teaching, research and scholarship; business-friendly courses with employability appeal; and the positive student experience on offer.
  • Target communications at parents as well as students.
  • Involve academics as much as possible; their enthusiasm can often bring big dividends.
  • Highlight student testimony in university marketing materials.
  • Make the most of social media’s influence and reach.

Case Studies: a vocational education institute and a community college

New Frontier School Board Continuing Education (Montreal, Canada)

New Frontiers School Board (NFSB) Continuing Education, in a suburb in Montreal, Canada, wanted to bolster enrollment and student engagement. Over a period of 12 months, The Watershed Media conducted an extensive communications audit, developed the blueprint for an online and offline marketing plan, and executed an entirely new digital and social media strategy and brand outlook. From their discovery, they knew that the success of the brand hinged on fostering intimacy and dialogue between the school and its students. Whatever they did had to be honest, authentic and true to life.

  • The Watershed injected the brand with a very personal narrative that celebrated the common theme of overcoming adversity and breaking through despite obstacles; a story that so many of their students shared in common. “I Choose Me” and the “Journey begins with you” were conversational brand elements that nurtured the empathetic quality that were the hallmarks of a school that was very student centered.
  • They revitalized the school’s social media presence through staff training and engagement, strategic content direction and social media marketing.
  • The website was built from the ground up and focused on reflecting a modern image that gave its users clear information, helped them make informed decisions about their future, and then act on those decisions through online conversion tools. The Watershed complemented student tools with community resources that would make the NFSB a valued asset to the communities it services. Site analytics are used to help refine content and define user experience in increasingly meaningful ways.
  • Equally important was their work helping NFSB shift the marketing culture at the school and discover their shared capacity to influence change through everyday inter-actions.

AriannePeters_Sample

Ramapo College of New Jersey (Mahwah, NJ, U.S.A.)

The brand strategy conceived and implemented by Words & Pictures Creative Service was to create an image campaign (print and radio, separate from the recruitment campaign) that would feature successful, famous, historical people who “could have been” Ramapo students. Shakespeare, Marie Curie, Andrew Carnegie, and Booker T. Washington were some of the role models who represented different schools in the College. This campaign elevated the College to a place where “some of the greatest minds in history could have started their futures” and where “the great young minds of today could start their futures.”

Results: Ramapo College experienced the following benefits and improvements over four years resulting in part from the image-building ad campaign:

  • Follow-up Eagleton survey conducted four years after original survey revealed overall dramatic increase in public awareness and improved perception.
  • Ranking in S. News & World Report moved to #1 public comprehensive college in the North for these consecutive years.
  • Combined SAT scores rose from 1120 to 1180.
  • HS rankings moved from top 24% to top 17%.
  • Full-time residential undergrads increased from 52% to 60%.
  • Retention rate from first to second year increased from 82.4% to 89.4%.
  • Retention rate from second to third year increased from 68% to 74.8% to 80% currently.
  • Graduation rate increased from 42.75 to 62.3% (well over national average of 50%).
  • Numerous industry and CASE awards recognizing excellence in the advertising image campaign and other collateral materials.
  • First-time donors increased by 35%.

In the final analysis

Educational institutions, whether in the youth sector, college level, vocational sector or in higher education/university ought to brand themselves succinctly to differentiate when communicating with prospective students, and perhaps with parents of students too. Needless to say, in the educational sector, the student is both the product and the customer. The service is the education delivered by its qualified educators. A well-crafted and compelling unique selling proposition (UPS), which the institution will consistently deliver upon, can give it a leg-up over its competitors in the category ‒ as well as build its brand. This is how a school creates well-earned attention, prominence and perceived value. It does this through its meticulous execution of its marketing and operating strategies, by way of a positive total student experience coupled together with its high academic standards. The approach is no different from a company selling apparel, food or hospitality.

Branding is an investment which offers the educational institution a distinction in competitiveness, awareness, a professional image and its reputation whilst adding equity to the organization’s assets. However, it’s a long term resource because it takes time to build a brand.

The practice of education branding building includes positioning. In this day and age change is a necessity not solely reserved for companies but equally important for schools – whether a university, college, vocational center and even in the youth sector (elementary and high school). Some may have require repositioning and re-branding. In the same way as the USP, this necessitates a well-defined (positioning) strategy so that the institution can build a consistent and successful brand in the course of time.

In re-branding, a new brand platform, including the identity and messaging should be carefully studied and developed.

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Brand Refresh: Re-branding Through a Meaningful Transformation

By James D. Roumeliotis

Rebrand Image

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 When a brand reaches a stalemate, management is to blame for neglecting constant evolving market trends, competitive pressures and ignoring customer feedback. If sales turnout to be lackluster for several quarters, it may be time to consider a re-branding strategy and implementation. Investing and continuously reinvesting in a brand’s nuance will earn and retain consumer loyalty. However, it is not adequate to merely change the look of the logo through an image makeover. The promise it conveys must be delivered each and every time – irrespective if selling a product or service. The advice offered herein concerns a fatigued brand and its product(s). As for a damaged brand, due to a company crisis, it is a subject on its own not reviewed in this article.

Complacency breeds mediocrity

In business, as with any other endeavor, progress is an ongoing process. Nothing should be taken for granted. Undoubtedly, the most profitable and enduring companies achieve their longevity and lengthy track record of success by constantly reinventing themselves. Once a brand is launched, it requires constant nurturing if it is to remain relevant, as well as customer engaged. This includes seeing opportunities and acting upon them in a timely and focused manner. Moreover, being aware of making adjustments according to ever changing trends in the marketplace, as well as through customer feedback, is paramount. The tools in a company’s chest is marketing research which uncovers needed information for a thorough understanding of its target market including perceptions its customers have for the brand. As a result, its knowledge will be updated with regards to consumer preferences and expectations. Following this, a short-term and mid-term approach should be implemented.

Customer centric vs product centric

Consumers today are more brand conscience, yet there are companies which continue to spend money advertising and selling product rather than brand. They place emphasis on price and quality as differentiators despite these two being overused by many copycats. Successful brands take a holistic approach to selling by exploiting the 5 senses which now constitute the brand. This is accomplished via “sensory/sensorial branding”, through a captivating designed setting, yet alluring. This adds character and invites clients to truly feel the brand experience.

Building and sustaining a brand necessitates continuous enhancements by means of innovation and customer centricity. The marketplace is also evolving and the consumer is more savvy, thanks to the internet. Add to that competitive and price pressures. In addition, there is a massive shift in purchasing behavior of the younger target groups most notably the Millennials, who unlike their parents, are very particular in their tastes and purchasing habits. This is due in part to an expanding world of choices and options for just about everything they ever need or want. Thus, new market realities should be contemplated when re-establishing a brand.

Branding in essence is the heart and soul of the business. It sets a business’s products and/or services apart from the competition. This is particularly true in certain sectors where price is the only differentiator, though competing merely on price is a dead end game as your product falls into a commoditized category. The only firms which can win at this game are those in high volumes and low margins. Needless to say, it is much better to target a niche market, especially in the premium category, where there is less competition and margins are higher.

Examples of brands which overhauled their brand to a higher level, reflect on the following:

Hyundai: From dull automobiles and inferior quality they transformed to developing striking designs, improved quality and sold at attractive prices. Taking their brand one step further, they added a halo effect by creating a premium category, in Genesis and Equus, to rival the well-established and pricier German competitors such as Mercedes, BMW and Audi models.

Apple: This strong brand began as a premium personal computer company with its first product, the Lisa, in the early 1980s. Much later, it introduced new and sought after categories in consumer electronics including the renowned iPhone. Fast forward to today, by hiring two former luxury domain senior executives and with the introduction of the Apple Watch, including an 18-Karat gold version (named Edition), the brand appears to be implementing a luxury strategy. Since perception and brand image is important in luxury distribution, Apple is considering opening separate stand-alone watch boutiques.

IBM: This brand went from computer manufacturing to IT consulting services. The company had to make a painful choice: innovate or die. It made the bold decision to abandon the core of its business model – selling low-margin personal computers, supercomputers and other computer hardware to a completely new focus – providing IT expertise and computing services to businesses. The business model revamp paid off. A few years in and IBM had acquired a significant number of companies in the IT services sector to dominate it with high margins.

To revamp a brand, consider carrying-out the following enhancements with purpose:

  • Add an element of sensuality and desire: Read article
  • Enhanced, appealing and easily recognizable identity: The logo, communication style, color scheme and any other visual elements of the company. Perception by its target market is key. Brand identity (company created and how it wants to be perceived) and brand image (what the consumers actually perceive) should be in sync.
  • Improved product and service: It is not simply adequate to reinvigorate a brand without refining the company’s products and services which should also make a positive difference. Read article
  • Compelling USP: The unique selling proposition should be meaningful and convincing if it is to be convey differentiation for the brand along with its products and services.
  • Storytelling: Brands build relationships by the stories they tell. Stories add personality to products which customers can better relate to and feel affinity with. For example, luxury brands boast their pedigree.
  • Lifestyle brand: Generally speaking, brands that are designed for a lifestyle should have a much higher emotional value to consumers than ones based on features like cost or benefits alone. Read article
  • Prestige or premium category: Move away from a commoditized product to a prestige and premium category if you want to differentiate as well as charge a premium price which in turn improve margins. Doing so should justify the “prestige” and “premium” labels through high-quality workmanship and materials along with benefits which trump its competitors. Adding a story behind it increases justifies the price increase. The brand may also be considered “mass luxury” or “masstige” (“prestige for the masses” and defined as “premium but attainable” by the masses.). Lacoste apparel is a fitting example.
  • Social media and PR savvy: Engaging with your target audience – this is conducted through social media and requesting Simply put, engaged customers help you build your business.
  • Make it fun and effortless to do business with you: Make each touch point a pleasant and graceful experience. Hire for attitude and train for high standard of customer services including thorough product knowledge and a no pressure consultative selling approach. Read article

To add to the above, it is imperative to include a management team and subordinates who buy into, as well as apply the above-mentioned elements.

Rebranding Image 2

Image is perception – repositioning time

A brand should be sensitive to its image and equally mindful about what its perceived strengths and weaknesses are as compared to its competition. A SWOT analysis helps uncover these.

There are a good number of factors to recognize in regards to what can erode a brand. According to The Blake Project’s Brand Strategy Insider newsletter, an article entitled “60 Signs Your Brand is Dying”, it describes: “What kills a brand, more often than not, is what it lacks rather than what it does: conviction; energy; value; humility; cash; discipline; imagination; focus…” along with a list of 60 reasons a brand is dying. We witness this with the downfall of the Blackberry brand of smartphones. The executives at the company were so arrogant, that they did not initially see yet later ignored the disruption Apple and the now ubiquitous Android platform would bring to the smartphone market. As a result of Blackberry’s lack of a long-term strategy to outmanoeuvre its competitors, it hastily introduced new products which still left the brand two steps behind Apple and Google with its licensed Android.

The takeaway

The brand is the personality, as well as an (intangible) asset of the business since it possesses equity which in turn is its value and goodwill from a consumer perspective. The more valuable it is, the more can be charged for the product and/or service. The foundation of the brand is/are its product(s) and/or service(s), followed by the total customer experience ‒ which includes customer service. Thus, building and nurturing a brand is what makes an enterprise gather wind under its wings.

A brand ought to undergo rejuvenation and in some cases, a fundamental change if it is to be relevant with its intended audience. To do so requires a systematic understanding of its typical customer profile, its wants, desires and the changing marketplace. This is done through a market analysis – the results of which will be taken in consideration for a new/updated and creative strategy with efficient implementation. If the brand has become stale, which is usually revealed through a steady decline in sales and discouraging customer feedback, it is a strong indication that its products and/or sales ought to be improved and re-launched.

In the end, can you frankly answer the following?

– What do you aspire your brand to stand and be relevant in the mind of your target market?

– What is your unique selling proposition?

– What is your raison d’etre? (Watch this immensely popular TED video by Simon Sinek)

– Are you admired?

– What are you doing to align your goals, objectives and to remain a compelling brand in your market?

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The Top 10 Most Read Articles in my Blog for 2014

Ten Most Popular image

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As we look back and close the year, I have rounded up the ten most read articles of 2014 by my readers. The following ten captured the most attention by numbers. See them all below in descending order.  Your views are always encouraged.

THANK YOU for your readership and look forward to feeding your mind with much more business practical food for thought which can be applied for timely results.

1| Luxury vs. Premium vs. Fashion: Clarifying the Disparity

2|Perceived Quality: Why Brands Are Intangible
3| The Ultra Luxury Purveyors: Lessons from brands catering to the richest 1 percent
4| Mass Customization & Personalization: The Pinnacle of Differentiation and Brand Loyalty
5| Brand Awareness: the influence in consumers’ purchasing decisions
6| The Art of Selling Luxury Products: Brand Story Telling & Persuasion
7| Exceeding the Hotel Guest Experience: Anticipating and Executing Desires Flawlessly
8| Pitfalls of Start-ups: How to Succeed Through the Initial Three Years and Beyond
9| Bold Leadership: 10 Ways to Eradicate Organizational Politics

10| Branding Essentials for Small Enterprises

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Exploring the Luxury British Automotive Total Customer Experience: Part 2 ‒ Jaguar Cars

Jaguar Lifestyle Image

Viewpoint by James D. Roumeliotis and Petrona J. Joseph

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In part 1 of this 4 part series, the Aston Martin automotive brand was the star focus. In this part, the spotlight is on the customer expectations with the British luxury automaker Jaguar Motors. For over 90 years, this high-status marque has pushed the boundaries of what was once considered impossible in the automotive industry.

Sir William Lyons – founder of Jaguar Motors, combined performance and beauty in the designs and manufacturing of the ‘Jag’. A feat unprecedented of his time, his uncompromising vision set new benchmarks which is still followed by the manufacturer until today. Despite a tumultuous period during the Ford Motor Company ownership, its present owner (the Tata industrial conglomerate based in India) has invigorated a new model lineup together with a bold marketing strategy through a substantial cash infusion. It also acquired, from Ford, the Land Rover luxury SUV brand.

With the big news of Jaguar’s upcoming justDrive™ ‒ an industry-leading app technology that integrates multiple smartphone apps into a single, voice-activated in-car experience; it is now a leading contender amongst its competitors.

Jaguar Interior

The Jaguar driver profile

The Jaguar customer is typically a refined man or woman – for the most part, a university graduate with a dynamic presence, and status symbol visible. Moreover, the Jaguar driver can be classified on some levels to the “blue temperament” – which is an analytical, prudent, detail-oriented and precise personality. In serving a Jaguar customer, one must not sway into personal details on the onset. In addition, the sales consultants have been trained to not ask many open-ended questions but rather ask close-ended questions and listen attentively. I also suggest note-taking, because the majority of Jaguar drivers (most in Executive positions) do not like to repeat themselves. By taking notes, one demonstrates the prospective Jaguar owner that you are unconsciously like them by mirroring their behavior.

Following is an outline on how authorized Jaguar dealers respond to customers – from Sales to Service.

Initial Sales Consultation

– Greeted promptly by the receptionist

– The sales consultant must greet the potential Jaguar consumer with the appropriate handshake (particularly the dominant handshake)

– Ask close-ended questions to ensure need and quality prospect.

– Initiate test drive

– Review objectives & listen to this customer clearly while note-taking

– Warning- there is a fine line between explain the benefits to this customer versus being aggressive in your approach. Allow this customer time to review the advantages of owning a Jaguar.

– An overnight test drive is quite rare, however during the test drive, outline the benefits of the drive and the technology.

Sales Process

Allow the appropriate time for this customer to choose options, colors and technology combinations. At this point, once trust and careful attention has been established- then proceed with open-ended questions.

Delivery

– Short and succinct (keeping in mind that this customer is discerning and either a professional practitioner, executive or a successful entrepreneur who may have to return to the office for an important meeting.

– The customer should be shown the basic functionality of his or her new Jaguar

– The customer should be asked to reschedule a one hour detailed information session at his/her place and time of convenience.

Jaguar Convertible

The automobile which reflects a luxury lifestyle

Premium and luxury car owners seek the total package with the car brand they choose to be loyal to as they would when checking in to a luxury resort. They seek more than just a vehicle they can enjoy from point A to B. In practice, its owner might use this automobile to commute to work, but this is not sole incentive. Jaguar is clearly a brand with authenticity and heritage. The principals shaping the consumer’s buyer behavior go beyond intention. There is a sense of engagement in fulfilling a dream. It can be to make a social status statement or a personal style choice. Whatever it is, it is not an unconscious choice. The codifiers are clear: This is who I am, and what I believe in. Ultimately, it can also articulate the owners’ sense of self-worth and their emotional aspirations. The most important emotional benefit is that a product of this caliber and class expresses itself when the consumer can declare: “It suits my lifestyle.”

Discreet and unconventional selling approach

Jaguar in North America is testing, in several major cities in the U.S., a novel way it presents new vehicles by showing appreciation to its most loyal customers, which it labels as “super-loyalists” by hosting elaborate receptions in their homes. In turn, the “super-loyalists” invite friends and associates who may be interested, and can afford, one of Jaguar’s elegant models. This idea takes away the perception of any high pressure sales normally associated with auto sales at dealerships.

Jaguar Classic Car

Dealers of prestigious auto brands as custodians of heritage

A luxury dealership’s ultimate goal is to make an entire ownership experience a pleasure ‒ let alone a Jaguar. They strive to build relationships, which is why so many of their clients remain loyal. A luxury dealership serves as a guardian for the rich heritage of their prestigious brands thus make certain to continue their legacy.

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Exploring the “Super Luxury” British Automotive Total Customer Experience: Part 1 ‒ The Aston Martin

Aston Martin Prestige Image

Viewpoint by James D. Roumeliotis and Petrona J. Joseph

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When we encounter the word “luxury”, images of: seamlessness, awe, the rarity factor, cache, opulence, aristocracy, supreme workmanship, stellar service and reverence come to mind, amongst others

Now, close your eyes for a moment. What images come to mind when you consider mention of the following vehicles: Aston Martin, Jaguar, Bentley and Range Rover? That’s what we will be analyzing in this four part series of the luxury British automotive icons and the above average expectations of consumers seeking such extravagant motor vehicles.

What qualifies the authors to give such commentary? Having worked and served — most notably with prestigious brands such as Gucci, Aston Martin, Jaguar, Bentley and Range Rover, as well as with mega yachts and coupled with extensive research and consultations in this domain –, both can accurately define the exceptional treatment tendered to a HNWI (High Net Worth Individual) luxury seeking discerning consumer. Brands which qualify to serve this exclusive market provide attention to detail, a plethora of product knowledge/competence, and discretion along with an implementation of an anticipated flawless post-sale/follow-up policy.

Price aside, a luxury car brand should embody cache, exclusivity, pedigree, craftsmanship and limited production. R.L. Polk and Company, a global automotive information and marketing firm that provides solutions to automotive and related industries, has re-defined the term with the appellation, “super luxury”, ‒ i.e. cars that cost over $100K. This category includes brands such as Rolls Royce, Bentley, Maserati as well as the Aston Martin being featured here.

Aston Martin Showroom

Aston Martin: License to thrill

We begin with the initial luxury automotive brand in this four part series: Aston Martin. This high valued motor car producer brings images of James Bond, a ladies gent, British heritage, sophisticated technology, sex appeal, speed, agility and soul.

Considering the above persona, the makeup of a typical Aston Martin customer.is a male (no gender discrimination intended), in his late 30’s early 40’s, handsome, successful, possibly with an attractive spouse (or if single, a striking companion), possesses a deep knowledge of refined luxury, knows what he wants virtually at any price level, and enjoys adventure, as well as thrives at constant new challenges.

Initial impressions and consultative sales process

When a prospective owner, or existing customer of an Aston Martin walks into any impressive looking Aston Martin showroom, the total experience should normally result as follows:

– To be greeted initially by the attractive receptionist/hostess (brand ambassadors) by the owner or General Manager of the dealership;

– Introduce the prospective client to an Aston Martin specialist;

– Offer a hot or cold fine beverage;

– Be given a tour of the impressive premises;

– Exhibit the various models and a test drive initiated during which time rapport is being built;

– Offer of an overnight test drive to create the feel and experience of the automobile and its performance characteristics;

– Thank and greet the prospect by the dealership owner or GM upon returning the vehicle followed by the sales specialist;

– Customer’s contact information should be entered into the dealer database (CRM);

– If a sale is initiated – the sales process should ensue. However, if a sale does not occur, effort should be exerted in a discreet and pragmatic manner (consider “consultative” selling) to close the sale. Statistics show that 60% of car purchases have been consummated on the spot when they received what they considered was an excellent presentation and demonstration. Either way, a follow-up is imperative within 24 hours.

Sale & delivery

– An appointment should be set for delivery;

– Upon arrival to pick-up the vehicle, customer should be congratulated by owner and/or GM;

– Explanation of vehicle model should be thorough along with a post-sale follow-up the following day;

– Customer should be offered a token appreciation for his/her business. This can be in the form of champagne from a strategic partnership for example, Moët & Chandon and/or an additional gift in good taste.

Aston Martin Showroom Lounge

Exceeding customer expectations for the discerning client-driver

To succeed in gratifying the seemingly sophisticated client, a high-end organization should develop a comprehensive strategy along with efficient implementation tactics. These include:
– Having a clear and unique value proposition that hooks them;
– Consider exploiting the five senses to attract and retain them – categorized as “ambiance”/”sensorial” marketing and branding;
– Staff must be customer centric, patient, empathetic, and good listeners – remaining calm under duress during client interactions;
– Employee retention – hiring for attitude and training for skills;
– Utilizing a hands-on approach;
– Probing clients’ specific needs/requirements – recognizing their motivations – reading their body language;;
– Earning their trust and respect by exuding confidence, empathy and transparency;
– Offering a personal touch – individualized attention with customized solutions – It’s all about the customer;
– Being frank and transparent with pricing, offers, proposals and promotions;
– Proposing an expansive product selection and service options;
– Outstanding and consistent levels of customer service throughout the organization;
– Reducing or eliminating waiting times – whether on the phone (reservations, customer service etc.), as well as for service or an appointment at the physical location;
– Offering customer loyalty programs through joint collaborations with other luxury purveyors – a great way to make them feel special by receiving something extra;
– Asking for feedback with regards to service and product experiences for ways to improve those experiences. Discerning clientele are typically strongly opinionated and relish giving their views.
– Implementing the latest technology with all touch points.

The Aston Martin automotive brand with its power, beauty, soul and heritage as its tagline delivers to a specific and limited market segment by giving way to its consumer target to acquire their models they associate with a “luxurious and sporty lifestyle.” The brand is essentially a status symbol.

Brand loyalty is about building an emotional, and in some cases, irrational, attachment in a product. “Total customer experience” is not an option but rather compulsory as part of an alluring brand. It takes savvy planning, execution and perpetual refinements to stand above the crowd. It’s how you get noticed and remain relevant. Luxury brand desirability is driven by standout design, craftsmanship, as well as what is felt.

A typical Aston Martin showroom portrays a super luxury car brand able to offer a “wow” factor to its intended customers with an unconventional retail experience which exploits the five senses. This includes a showroom floor with ideal lighting, the various models well positioned/presented, impeccably dressed/groomed staff, and an upscale lounge ‒ overall, presenting sight, sound, smell, touch sensorial experiences and creating a feeling of lavishness. Some will go as far as offer art exhibitions on the premises, five star dining events and wine tasting to name a few. It’s what its type of clientele crave.

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Product Features vs Benefits: The Brand Differentiation

By James D. Roumeliotis

What is in it for me - features vs benefits

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There was a time when brands and their sales staff would tout the features of their products. This was most notable with consumer products and automobiles amongst other goods. “Our product has this and that” and “Our product will do this and that for you.” sound alike, but are distinctly different. In this day and age, the second one wins over customers by a long-shot.

Take the case of buying a watch. The function of a watch is to tell time. All watches do this. To differentiate, a watchmaker must bring something else to the table. For example, the Rolex Submariner has many outstanding features. Watch fanatics can recite the details like kids cite stats of baseball players. However, most clients want to feel elegant. They already know that a Swiss watch means high quality. The benefit of wearing a Rolex is to make the wearer feel like James Bond or Gianni Agnelli. The benefits are is style, class, and self-esteem.

People Buy Benefits Rather Than Features

Features of a product are considered a ‘good to know’, whereas its benefits are deemed more relevant to its users as “what I can relate to and need to contributes positively to my sense of self” sell not only the product, but the “idea” of the product. Since there is competition with virtually every product, brands should create interest to more than practical needs of potential customers. The brand’s product(s) must persuade customers to think that it/they perform better and offer a much better value than the competition. For example, Hyundai’s Genesis, through its advertising and sales consultants, stress ‘intelligent value’ when compared to the established premium auto brands like Mercedes, Audi, BMW and Lexus. The emotional benefits are what a brand/product ought to be targeting and appealing to. This would make the driver feel as if he/she has made financially and emotionally a wise decision.

As marketers are quite familiar with the term “sell the sizzle, not the steak”, in layman terms, it signifies that you’re not only selling the product, but the idea of the product.

What is Your Brand USP? Benefits Must Be Tangible

To begin with, a “Brand” is a promise of something that will be delivered by a business. A brand promise comes in a form of quality, an experience and a certain expectation in the mind of the consumer. A major part of this is what’s called the “Unique Selling Proposition” or USP.

Prior to launching or invigorating an existing product, the questions which should be asked are:

  • What is our purpose?” and as a result: How is our target market going to benefit from our product?
  • What will the brand and product stand for? How are they going to be positioned?
  • What is the product’s intrinsic value? Perceived value?
  • Is it going to be a lifestyle product?

Simon Sinek takes the aforementioned a step further with thought provoking questions. An accomplished author and adjunct staff member of the RAND Corporation, one of the most highly regarded think tanks in the world, in his popular talks worldwide, including TED, compellingly emphasizes the following:

Why does your organization exist? Why does it do the things it does? Why do customers really buy from one company or another? Why are people loyal to some leaders, but not others?  Starting with “why” works in big business and small business, in the non-profit world and in politics. Those who start with “why” never manipulate, they inspire. And the people who follow them don’t do so because they have to; they follow because they want to.”

Alternatively – Sell a Lifestyle and an Experience

Generally speaking, brands that are designed for a lifestyle should have a much higher emotional value to consumers than ones based on features like cost or benefits alone. Brands also build relationships by the stories they tell. Stories add personality to products which customers can better relate to and feel affinity with. Luxury brands boast their pedigree and craftsmanship, amongst others.

Brand loyalty is about building an emotional, and in some cases, irrational, attachment in a product. The most ideal example is when thousands of people line-up, regardless of weather conditions, to get their hands on the latest iPhone or any new product launch such as the imminent iWatch. This happens because Apple has built an emotional attachment to their products by creating a lifestyle choice rather than a product purchase.

It’s about how it makes you feel. Same goes for baby boomers, whether accountants or attorneys or business executives who purchase a Harley Davidson motorcycle and ride them for about four or five hours every Sunday afternoon. The bike makes them feel like a rebel – sort of an escape.

A brand that is designed for a lifestyle should have a much higher emotional value to consumers than one based on features like cost or benefits alone. The goal of a lifestyle brand is to become a way that people can utilize it to relate to one another. Those brands are an attempt to sell an identity, or an image, rather than a product and what it actually does.

Features vs Benefits

The Final Take

If your product stands-out on its own because it functions splendidly and enhances its intended purpose, then it can’t help but be embraced by consumers without the artificial hype. It’s what they will talk about to others which is the most candid endorsement the product can earn. It’s equally important to sell the idea of a product as it’s to sell the actual product.

The key to success is to market your brand, not your product. Contrary to popular belief, a brand is not a logo, label or product but rather a relationship with your customers. Branding positively adds value to your company including brand equity. This is considered intangible brand value.

A company can define itself as a lifestyle brand when its products promote a more than a product with key benefits and attributes. Note however that lifestyle branding is more than just promoting “a way of life.” It is a product or service that provides consumers with an emotional attachment to the brand.

One way to overcome the ‘price only’ differentiation, which erodes profits and does not generate loyalty, is for a company to consider building a lifelong relationship with each customer. To do so, requires that each customer enjoys a positive and hassle-free transaction with each touch point consistently every time.

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The Genuine Luxury Domain and Its Country of Origin: Why the Latter Matters

Viewpoint by James D. Roumeliotis

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Made in Italy - NO in China Tag

With the proliferation of Italian and French luxury brands bearing the ‘Made in China”, ‘Made in Turkey’ or made elsewhere remote from their land of origin, it makes one ponder whether the brands are diluting their image for the sake of lower prices and higher profits. This begs us to revisit the question of what constitutes an “authentic” luxury product and whether manufacturing in a country unknown and unfamiliar for evoking luxury is a good long term strategy for the brand with heritage.

Luxury vs. Premium vs. Fashion: Clarifying the Disparity

Definitions of “luxury” vary enormously and depend on with whom you discuss the topic and in what context. The term “Luxury” has never been something easy to define. It is relative, mysterious and elusive. In essence, it revolves around subjective criteria in the mind, which creates a mood and what is generally referred to today as lifestyle.

The proliferation and marketing misuse of the word “luxury” on many products across sectors is quite evident. Brands either do it out of ignorance or to enhance the desire for the consumer to purchase their products.

Gary Harwood at HKLM, one of the founders and directors of a leading strategic branding and communication design consultancy, affirmed:

A luxury brand is very expensive, exclusive and very rare – not meant for everyone. When it ceases to be these things, then it’s lost its exclusive cachet. Commoditizing luxury brands and making them more accessible to the middle market puts them at risk of becoming ordinary, common and less desirable. And the more available a brand is, the less luxurious it becomes.”

Authentic luxury brands compete on the basis of their ability to invoke exclusivity, prestige and hedonism to their appropriate market segments not the masses. There is a classic litmus test:

  • Is the product manufactured in artificially limited quantities? (i.e. the rarity factor)
  • Does the firm have a story to tell? (i.e. history & pedigree)
  • Is the firm portraying a unique lifestyle?
  • Is craftsmanship the hallmark, which delivers products that only High Net Worth individuals can purchase without question?
  • Does the brand offer authenticity?
  • Does it implement an absolutely no discounting policy?
  • Is the product (and at least most of its materials/parts) manufactured only in its country of origin?

Luxury is not premium – and premium is not luxury. They are two dissimilar categories catering to different market segments.

France - Italy Cufflinks

Luxury Product Roots and Perception: Key Factors of Authentic Luxury

A luxury product is rooted in a culture and comes along with a small fragment of its native soil, of its heritage. This proposes that in order for a “luxury” product to remain true to its origins, as one of its main criteria, its production shall remain in the country of origin ‒ whether that is France, Italy or elsewhere (most notably in Europe). Tempting to relocate production elsewhere can cause the brand to lose its lustre and character.

Professor Jean-Noël Kapferer, an author and lecturer at the Kellogg Business School (Northwestern University, USA), as well as at HEC Paris, Europe’s premier academic research center on Luxury, clarified his views on this subject matter by stating that:

Looking at luxury companies’ own attitudes, there is a clear segmentation, based on their brand positioning and business model. A first group (such as Louis Vuitton, Hermès, Chanel) emphasize quality and heritage as the main sources of their incomparability. They are patriots. For them, a country of origin is a homeland, much like the soil in a vineyard – a miracle made of earth, nature, sun, rain, and sophisticated human labor, loaded with culture. For them, ‘made in…’ tells a whole story, tying production to a long heritage.

He further affirmed that:

“To remain a true luxury brand, following the luxury business model, entails sticking to local production. This is not an easy task for many luxury brands. Those that comply must create the conditions that are necessary to sustain this production. This is why they often buy their local sub-contractors in case the latter go bankrupt, to be sure to keep alive a historical know-how that might otherwise disappear.”

France and Italy are considered the leading countries for luxury and trend setters for clothing and accessories. Luxury watches (better known as “timepieces”) are manufactured in Switzerland ‒ the undisputed leader in this category. London, is considered to be the luxury spirit capital of the world with Burberry as the most prominent luxury brand. Whereas, Germany Italy, as well as the UK are for luxury automobiles. However, what they do produce elsewhere in the world are not ‘luxury’ but rather their lower priced “premium” derivatives (think BMW, Mercedes and Audi). Other illustrious automotive names, such as Ferrari and Rolls Royce, continue to manufacture solely in their native country.

Private vs. Public Luxury Purveyors

For the good of their distinguished image and cache, top-tier luxury brands should remain small privately held, with no pressure to sell and family run beyond the reach of speculators. These companies are managed, and their equity held, by those families. Consequently, management of brands, people and profits are done with the long term in mind, not necessarily the next quarter, which most investors would not have the patience to deal with if the luxury brand was publicly traded. In essence, the privately held have the luxury of taking risks as they desire and staying the course when they don’t. They have the freedom to invest for 5-10 years without receiving a financial return. In comparison, the publicly traded ones, which are accountable to their shareholders, are constantly under pressure to trim production costs and increase revenues and profits which lead them to cater to a larger audience ‒ the mass affluent. So much for all the elements of ‘genuine’ luxury purveyors which are doing away with scarcity and exclusivity.

The most prominent smaller and privately held ‘authentic’ luxury brands which fulfill every criteria ‘luxury’ truly exudes are as follows:

Soft Luxury Goods (high-end apparel, leather goods and exclusive fragrances) include: Hermès (70% owned/controlled by the Dumas family ‒ the descendants of its founder), Chanel (100% ownership by the Wertheimer family) and the niche perfume house, Creed Fragrance Company founded in 1760 (100% ownership by the Creed family ‒ descendants of its founder).

Hard Luxury Goods (products such as watches, jewellery and pens) include: Rolex, Chopard, Patek Philippe amongst others.

According to the Millward Brown luxury brand survey, which includes the large luxury groups, Louis Vuitton, Hermes, Gucci, Chanel, LVMH (Moët Hennessy Louis Vuitton), Rolex, Cartier, Fendi and Tiffany & Co. respectively, are the most successful family owned luxury brands. Moreover, research done by SDA Bocconi, renowned for providing world class luxury education, revealed that unique characteristics of most family-owned or managed business fit almost perfectly with the competitive logic of hard and soft luxury approaches. Needless to say, their management culture, retaining the mystique (crucial in the ultra-luxury domain), and long-term decision approach are all instrumental for cultivating and preserving their brand heritage.

Hermes 2014 Ad Campaign

Hermes 2013 Ad Campaign

In the Final Analysis

There should be no confusion between luxury and premium or even a fashion category. When someone buys a luxury object, he/she purchases craftsmanship, cache, pedigree, made in limited quantities, a special place in the world of lifestyle and exclusivity (made for the few). The premium business model is based on the manufacturing of best-in-class products, with an image of style. Fashion is a general term for a popular style or practice, especially in clothing, foot wear, and accessories. Fashion references to anything that is the current trend in look and dress up of a person. Usually not timeless. A “luxury” and a ‘premium” product can be both – as in a tailored made fine wool suit for example.

Therein lies the major differences between a luxury product and a premium product. It’s legitimate for a premium product to seek out the most suitable and most economical manufacturing location, so long as quality and service levels can be maintained.

Brands such as Nike, Adidas, Ralph Lauren, Hugo Boss, Tommy Hilfiger, amongst others, are doing an exceptional job of selling solely an image to the masses. Indeed, far from being a genuine ‘luxury’ brand, most of their products are manufactured in low labor countries such as China.

The ‘made in’ label plays a significant role for luxury aficionados who hold higher expectations including a value added quotient to ‘luxury’ brands who produce their products in their respective country of origin – mainly France, Italy and the U.K. For categories other than apparel and accessories, production should be elsewhere in Western Europe.

In the article “Building a Luxury Brand Image in a Digital World” by David Dubois, INSEAD Assistant Professor of Marketing and Debbie Teo, INSEAD MBA, they quote the following:

Hermès has no desire to become ‘masstige’ (a mass producer of prestige goods) the company’s CEO Patrick Thomas stated in 2009. In essence, he asserted that his brand was not in a position to dilute its image and compromise on quality in the interest of short-term results. This is truly one of very few authentic “luxury” brands befitting the model and criteria in the sense of the word.

Privately held luxury brands are prone to view business with long-term vision and remain rigid with quality over quantity. Comparatively, their publicly traded counterparts go out of their way to please their shareholders which may dilute their “luxury” status for the sake of volume and short–term gains.

Good business decisions are not the domain of tactical “bean counters” — exploiting the luxury brands for all their worth. They may also come from strategic planning and overall financial leadership.

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Maestros of Ambiance: The Art of the Hotel & Food Establishment Experience — in visuals

by James D. Roumeliotis

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The Genuine Luxury Establishment: Perception, Ambiance & the Total Shopping Experience

Luxury Street - Cartier

by James D. Roumeliotis with a special contribution by Stephane Delille

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Consider this! You are walking on, what is considered, a prestigious street in a downtown area of a major city lined up with a slew of luxury shops. What do you particularly notice about the look of the shops as compared to mainstream stores? Would you say it’s the window displays which are striking? The entrance? The upscale and inviting interior design? The way the merchandise is displayed?

Designing a luxury shop is much more than four walls, racks and lighting. It’s a meticulous creative and holistic process taking into account that luxury stores have to transmit the identity of a luxury brand, so that the image the customer has of this brand is affirmed by each store visit. Needless to say, it’s a design concept coupled with the total customer experience in mind.

Piaget timepieces, Bond Street, London boutique

Piaget timepieces, Bond Street, London

Ambiance, personalized service and the total shopping experience 

In a world where the consumer has become savvier, luxury products more accessible through an increase in democratization of luxury brands and the rapid emergence of prestige brands, the retail environment in luxury branding is all about heightening the consumer’s brand experience and amplifying the brand aura.

A well designed luxury retail boutique should embody an extraordinary design that is timeless while maintaining a striking interior that is unique, inviting, functional, and most certainly portray a luxurious setting.

A custom designed attractive setting – yet alluring with captivating style, invites customers to truly feel the brand experience by adding character. It exudes a “You’ve arrived!” underlying message. This is accomplished by connecting the feeling of warmth and acceptance ‒ via emotions to a product or service, and infusing it with a tangible and intangible essence that remain in the customers’ minds. The vital elements are:

  • Location: The luxury brand store perception all begins with its location. A prestigious address/neighborhood makes an initial luxury statement ‒ whether on a prominent avenue such as Bond Street in London, Rue Saint Honoré in Paris or Rodeo Drive in Beverly Hills and at other renowned high-fashion streets worldwide. A high-end mall and airport outlets are becoming ever more popular due to their convenient spots along with an increasingly sophisticated environment.
  • Facade/Window Display: transparency/opacity of the windows, display highlights for outside windows (product type, arrangement of space, animation, colors and much more.), frequent creative displays and themes all play a vital role in showcasing merchandise with pizazz.
  • Main entryway: This should reflect an imposing appearance by creating the feeling of grand luxury access to the interior of the boutique. Elizabeth Arden’s signature red door is a distinguishable fixture at her stores and spas worldwide.
  • Decor: Attention to details including well-crafted attractive furnishings and materials (pillows or decorative accents) throughout. Choice of color palette, textures, combination of materials and accents all influence the overall store image in addition to being part of the overall design esthetics.
  • Lighting and its effects: The proper choice of illumination adds to the overall design and ambiance.Lighting can bring focus to merchandise displays, hide imperfections, add warmth, and help create a positive shopping experience for the brand’s clients. Halogen spots and LED lighting are the preferred variety for interior designers.
  • Smell and Background Music environment: These reflect the store’s personality. Smell is considered the olfactory of the fifth human sense. The scenting strategy is part of “sensory”/”sensorial” marketing and branding that’s meant to attach certain smells to brands, drive loyalty, and make people feel at home. Whereas, music/sound supports refining brand communication and in designing a better sounding environment. A discreet volume should be considered as an ideal comfort level.
  • Merchandising appeal ‒ display and layout: localization of displays (size, colors, kits, messages) while keeping in line with brand values and guidelines. The spaces where your clients see and touch your products have an effect on the visual aspect along with their shopping experience.
  • Lounge area: possibility or not to have private salons for VIPs, to utilize for private shows/demonstrations, presentations and other special gathering purposes.
  • Service amenities: Washrooms should possess panache and be spotless. Their design can achieve the look and feel of luxury with both functionality and comfort. A kitchenette can be an additional amenity for preparing and catering light food/hors d’oeuvres. A workshop for bespoke functions such as product setting on the spot, size customization, engraving etc). Perhaps a kid’s space with animation to keep a child/children busy while their mum/dad/parents are shopping. The kids can eventually be converted to the luxury label themselves.
  • Staff Caliber and Overall Customer Care: Luxury goes beyond good looks. The service offered is a major event in itself. This comprises of dress code, attitude, and politeness regardless of what the client looks/wears. As well as responsiveness, a consultative sales approach and accessibility. This requires proper hiring criteria, on-boarding and repeated training in product knowledge, presentation skills, and anticipating customer expectations to go above and beyond. Luxury firms need to implement KPIs (Key Performance Indicators) to gauge their service effectiveness which do not only measure the performance of organizational processes, but also warrant a consistent quality level of in-store service.

Bijan Boutique

Bijan Boutique, Rodeo Drive

Artisans of timeless and artistic retail interior design

It takes bold strokes to prevail from the competition by showcasing a distinctive look along with creating an emotional bond with the clientele. As such, luxury brands are making their mark on the map with a radical and explosive architectural vision. It’s where design innovation coupled with creativity are paramount when delivering artistic solutions driven by each individual brand’s image.

When it comes to commissioning distinctiveness with luxury ambiance interiors in the retail, restaurant and hotel sectors respectively, Yabu & Pushelberg have become the go-to interior designers akin to what Frank Gehry is to deconstructivist architecture. In over three decades, the duo partners, based in Toronto along with a New York City design studio, have fostered a client list that ranges from Louis Vuitton and Tiffany & Co to Four Seasons Hotels and renowned French chef and restaurateur Daniel Boulud. In their work, Yabu and Pushelberg manage to articulate luxury through contrasts, austere designs with fine materials, as well as through comfort and the casual, strong points of view, including a crafty mix of art and artisanship. For them, luxury is a state of mind, not a material.

Yabu-pushelberg-lane-crawford-sitting-area

A Yabu & Pushelberg sample interior

The final take

The ambiance created in a luxury boutique is one of the finest marketing tools. The aesthetic appeal to human senses, the feel of the brand creates the image. Along with great service, it is one of the most important reasons customers will choose to shop repeatedly. It’s where the brand lives by orchestrating immaculate detailing that engages all senses of the discerning target audience. Surround the brand and its products/services with fashion, beauty, design and attractive models – without any characteristics of tackiness.

It all begins with the choice of store location, the immediate initial impression (window display, entrance, store layout, merchandising, furnishings, lighting and much more), the sales staff presentation and the impact of each touch-point in creating a unique indulging experience. The small touches that regularly go unnoticed help to create a distinct sense of place in luxury commercial spaces.

Emporio Luxury Mall, New Delhi, India

Emporio Luxury Mall, New Delhi, India

All that said, today’s savvy luxury consumers are increasingly seeking much more than merely a cosmetically elegant looking bricks and mortar shops. They have become more discerning and seeking a more knowledgeable and professional assistance to help them in managing their lifestyle and stature. It all boils down to the total customer experience which embraces knowledgeable and helpful staff, alluring presentations, storytelling, exclusive invites and privileged previews amongst other lifestyle themed activities.

FOR THE “15 Retail Essentials – Your Opening Toolbox” PRESENTATION, KINDLY COMMUNICATE WITH JAMES AT: jdr(AT)affluencemarketing(DOT) ca

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