Creating brand experience: a magical experience constructed
Managing brand experience: creativity and innovation can be institutionalized
-standardize innovation process
-may not need to (or even want to) listen to customers to understand customer experience
Listening to customers vs. understanding customers: the chef is the professional so he knows what customers
want during innovation phase, but also collect feedback after the experience.
When profitability clashes with brand strategy
-need to consider how improvements can change brand experience
Brand Crisis Management
1. Plan: pre-planned set of guidelines
2. Acknowledge the problem and apologize
3. Get outside help
4. Inform and update customers/communities
Straight and soon, flood the zone, good bad and ugly, distill and simplicity, repeat
5. Monitor then respond
Samsung Note 7 Crisis: brand insulation effect and national support means Samsung won’t be hurt in the
long run but can improve on informing and updating and get channel support.
Volkswagen and the end of the Corporate Spin
The most admired organizations don’t do “spin;” the old world of corporate secrets is over and organizations
are still trying to catch up to this reality.
There are complex social, political, and technological reasons for this dramatic change. At the social level, two
phenomena coincide. First, the decline of public trust in organizations and second, the marked decline in levels
of deference to authority.
The old practice of “covering up” no longer works. Spin backfires. The breadth and depth of information
available today has created a more knowledgeable public, less easily swayed by public relations efforts. The
default mode should be to share everything – only holding back that which is restricted by law or regulation.
In this new environment, organizations and their leaders need what we call radical honesty. Leaders and
managers must become compelling communicators, operating according to the following general guidelines:
• Straight and soon. Get the story out honestly and quickly – always assume you have less time than you
• Flood the zone. Use many channels – you need to connect with different kinds of stakeholders, different
generations, genders, cultural backgrounds, with different communication habits. • Good, bad, and ugly. Encourage honest conversations about both hopes and fears. Remember that
power relationships sanitize information that gets to the top. Ensure people can bring bad news.
• Distill and simplify. Keep communication simple and relevant, don’t drown people in irrelevant data.
• Repeat. Find ways to reiterate the message and build feedback loops. Remember that trust builds slowly
and quickly fades once the message stops, or when people see or hear contrary data.
Luxury Brand Marketing- The Experience is Everything
The marketing of luxury goods has become increasingly complex, being associated not only with conveying an
image of quality, performance and authenticity, but also with attempting to sell an experience by relating it to
the lifestyle constructs of consumers. The characteristics of luxury goods suggest that marketing within the
sector is different from many other industries but despite these perceived differences, there is, however,
evidence to suggest that marketing in the luxury goods sector relies heavily on traditional marketing concepts.
A New Luxury Paradigm
Parameters of luxury
Luxury and non-luxury goods can be conceptualised according to functional, experiential and interactional
symbolic dimensions. Luxury has traditionally been associated with exclusivity, status and quality. 'New
luxury' has been defined as 'products and services that possess higher levels of quality, taste, and aspiration than
other goods in the category but are not so expensive as to be out of reach'. Within a broader context, observers
have pointed to the trend of middle-market consumers trading up for products that meet their aspiration needs,
referred to as the 'luxurification of society'. This trend appears to be evident within a global context. The result
is that marketers within this sector need to redefine their strategies to reflect these changes.
Consumption of luxury
There is differentiation between non-personal- and personal-oriented perceptions.
Non-personal-oriented perceptions refer to perceived conspicuousness, uniqueness and quality. Indeed,
acquisitive luxury has been attributed to contemporary luxury consumption in emerging markets such as Russia
and China. 'Motivated by a desire to impress others, with the ability to pay particularly high prices, this form of
consumption is primarily concerned with the ostentatious display of wealth'. This was typified by the
emergence of the so-called 'yuppie' lifestyle segment in British society.
Contemporary consumers use consumption to make statements about themselves, to create identities and
to develop a sense of belonging. Luxury goods are acquired for what they symbolise, which is argued to be
consistent with personal-oriented perceptions. 'The expression of 'today's luxury' is about a celebration of
personal creativity, expressiveness, intelligence, fluidity, and above all, meaning'.
Luxury and Postmodernism
Recent arguments have been sounded that aspects of contemporary luxury consumption have reflected the
phenomenon of postmodernism. Postmodernism is essentially a western philosophy that 'refers to a break in
thinking away from the modern, functional and rational' or as 'the evasion of the subconscious'. Within the broad context of marketing, it is generally acknowledged that consumption has become a defining feature of
postmodern societies. In terms of experiential marketing, two aspects of the postmodern discourse are most
relevant: hyper-reality and image.
Hyper-reality refers to 'the blurring of distinction between the real and the unreal, in which the prefix 'hyper'
signifies more real than real. When the real that is the environment, is no longer a given, but is reproduced by a
simulated environment, it does not become unreal, but realer than real'. 'Hyper-reality engenders a general loss
of the sense of authenticity. In postmodern society, people exist in a state where signs and images have become
more important than what they stand for. The result is that consumers in contemporary society consume
imagery, and do not focus on what the images represent or mean.
In a new age, with new consumers, we need to shift away from a features-and-benefits approach, as advocated
by traditional approaches to consumer experiences. One approach is experiential marketing viewing consumers
as emotional beings concerned with achieving pleasurable experiences. The traditional product/service value
proposition is no longer adequate for reaching consumers or creating significant differentiation. Businesses
must facilitate the enhancement of a seamless total experience for consumers, which determine whether
products or services maintain competitive edges.
Experiential Luxury Marketing
The experience economy
Experiential marketing is about taking the essence of a product and amplifying it into a set of tangible,
physical and interactive experiences that reinforce the offer. Experiential aspects of consumption: fantasies,
feelings and fun. Increasingly, consumers are involved in the processes of both defining and creating
value, and the co-created experience of consumers through the holistic brand value structure becomes the very
basis of marketing.
Dimensions of the luxury experience
We think about experiences across two bi-polar constructs - customer participation and connection. We have
adapted this framework, based on customer involvement and intensity, to identify four 'experiential zones',
namely, Entertainment, Education, Escapist and Aesthetic. The term 'involvement' refers to the level of inter-
activity between the supplier and the customer. Suppliers no longer create an experience and pass it to the
customer; instead, the supplier and customer are interactively co-creating the experience. The term 'intensity'
refers to the perception of the strength of feeling towards the interaction.
Those experiences we think of as Entertainment, such as fashion shows at designer boutiques and upmarket
department stores, usually involve a low degree of customer involvement and intensiveness. For instance,
flagship Gucci and Chanel stores in Tokyo have added restaurants and bistros with marquee chefs. For luxury
goods marketers, the key is, however, to apply a more holistic approach, that is, to incorporate entertainment
into areas outside the immediate experience. Fendi's spectacular show staged on the Great Wall of China is,
here, a compelling example.
Activities in the Educational zone involve those where participants are more actively involved, but the level
of intensiveness is still low. In this zone, participants acquire new skills or increase those they already have.
Many luxury goods offerings include educational dimensions. For example, cruise ships often employ well-
known authorities to provide semi-formal lectures about their itineraries.
Escapist activities are those that involve a high degree of both involvement and intensiveness, and are clearly
a central feature of much of luxury consumption. This is clearly evident within the luxury tourism and
hospitality sector, characterised by the growth of specialised holiday offerings. Likewise, celebrity endorsements for luxury products and services can help to foster escapism via association. The Tiger Woods
Dubai is a private residential community and resort that will include the world's 1st golf course designed by
When the element of activity is reduced to a more passive involvement in nature, the event
becomes Aesthetic. A high degree of intensiveness is clearly evident within this activity, but has little effect
on its environment such as admiring the architectural or interior design of designer boutiques. Again, it is easy
to conclude that much luxury goods activity is of an aesthetic nature, with consumers immersing themselves in
the experience, but with little active participation.
Strategies for experiential luxury marketing
Academics and practitioners alike have developed frameworks to help formulate strategies for developing
experiential branding strategies. Smith has put forward a six-step process: (1) Conduct a customer
experience audit in order to assess and evaluate the current experience of the brand. (2) Create a brand
platform that involves defining a clear brand-positioning statement. (3) Design the brand experience. This
involves the alignment of the brand's people, processes and products against the brand proposition. (4)
Communicate the brand internally and (5) externally. (6) Monitor performance in order to ensure that the
brand is delivering against defined objectives.
Likewise, the design and brand strategy consultancy Lippincott Mercer presented the following four principles
of experience design: (1) Identifying key customer segments. The trend towards the so-called 'democratisation
of luxury' has significantly changed luxury consumption patterns. The evaluation of customer data can help to
identify the most profitable customer segments. This will ensure that the brand is connecting with the right
target segment. (2) Develop a touchpoint chain and gauge those with the greatest impact. Touchpoints or
interactions between the brand and the target are categorized according to the phases of pre-purchase,
purchase and post-purchase. (3) Turn findings into project priorities. Some luxury brand touchpoints will
be more relevant than others. For example, browsing is critical to the purchase decision-making process among
female fashion shoppers in India. These so-called 'moments of truth' need to be aligned against 'takeaways' of
the experience. (4) Implement and monitor. It is here essential that interactions are consistent with the desired
The use of new technologies has also aided the potential for experiential marketing. The Luxury Institute found
that 88%of wealthy consumers cite a preference for using the internet to research a luxury services firm,
and 38% prefer to purchase luxury goods online. The management consultancy, A.T. Kearney developed a
7Cs model to create a high-impact digital customer experience - content, customisation, customer care,
communication, community, connectivity and convenience. Likewise, Constantinides identified functional
factors (usability, interactivity), psychological factors (trust) and content factors (aesthetics and
marketing mix) as the main building blocks of web experience.
Conclusions and Implications
The difference between traditional and experiential marketing can be highlighted in a number of ways. First, the
focus is on customer experiences and lifestyles, which provide sensory, emotional, cognitive and relational
values to the consumer. Second, there is a focus on creating synergies among meaning, perception, consumption
and brand loyalty. Third, it is argued that customers are not rational decision-makers, but are rather driven by
rationality and emotion. Finally, it is argued that experiential marketing requires a more diverse range of
research methods in order to understand consumers. Innovative experience design will become an
increasingly important component of luxury marketing. Managing the growth tradeoff: Challenges and opportunities in luxury branding
10 Defining Characteristics of Luxury Brands
(1) Maintaining a premium image for luxury brands is crucial; controlling that image is thus a priority
(2) Luxury branding typically involves the creation of many intangible brand associations and an aspirational
(3) All aspects of the marketing programme for luxury brands must be aligned to ensure quality products and
services, and pleasurable purchase and consumption experiences
(4) Brand elements aside from brand names - logos, symbols, packaging, signage and so on - can be important
drivers of brand equity for luxury brands
(5) Secondary associations from linked personalities, events, countries and other entities can be important
drivers of brand equity for luxury brands
(6) Luxury brands must carefully control distribution via a selective channel strategy
(7) Luxury brands often employ a premium pricing strategy with strong quality cues and few discounts and
(8) Brand architecture for luxury brands must be managed very carefully
(9) Competition for luxury brands must be defined broadly, as they often compete with other luxury brands from
other categories for discretionary consumer dollars
(10) Luxury brands must legally protect all trademarks and aggressively combat counterfeits
Managing growth Tradeoffs with Luxury Brands
Marketers of luxury brands face some very challenging tradeoffs in their marketing that can often mean the
difference between success and failure. Three of the more notable tradeoffs are as follows:
1. Exclusivity vs accessibility
2. Classic vs contemporary images
3. Acquisition vs retention
There are a number of areas that luxury brand marketers must consider to address this 'growth tradeoff,' but two
potentially critical areas deal with brand equity measurement and brand architecture
Brand equity measurement
To understand the nature of the growth trade-off and any problems it may pose, marketers of luxury brands
must be extremely close to both existing and prospective customers to assess how relevant their brand equity is
across diverse market segments.
1. Brand strength and stature BAV, there are five key components - or pillars - of brand equity: Differentiation, Energy, Relevance,
Esteem, Knowledge (DREEK)
Traditional luxury brands are rated very highly by consumers on differentiation and esteem, although due to
their aspirational nature and mystique, they may not score nearly as high on relevance and knowledge.
2. Brand imagery
Many kinds of intangibles can be linked to a brand, but four categories can be highlighted: User profiles is the
type of person or organisation who uses the brand. Purchase and usage situations is under what conditions or
situations the brand could or should be bought and used. Personality and values reflect the fact that a brand,
like a person, can be characterised as being 'modern,' 'old-fashioned,' 'lively' or 'exotic.' History, heritage and
experiences are associations with a brand's past and certain noteworthy events in its history.
3. Brand feelings
The following are six important types of brand-building feelings: Warmth: Hallmark, Fun: Disney, Excitement:
MTV, Security: AIG Insurance, Social approval: Mercedes, Self-respect: Tide-'doing the best things for the
family' for many homemakers.
The first three types of feelings are experiential and immediate, increasing in level of intensity. The latter three
types of feelings are private and enduring, increasing in level of gravity, which luxury brands create more. An
important distinction can be made within enduring feelings among inner-directed feelings such as a sense of
security, comfort or self-assurance, outer-directed feelings such as social approval, or a combination of
inner-directed and outer-directed feelings such as self-respect.
4. Brand expectations
The following are three notable types of expectations: Could expectations - what could the makers of the luxury
brand choose to do if they wanted to? Should expectations - all things considered, what should the makers of
the luxury brand do? Will expectations - what do consumers think the luxury brand maker will actually do?
Of concern is when the 'will' expectations lag too far behind the 'could' and especially the 'should' expectations.
Vertical extensions can be especially tricky for luxury brands. In such cases, brand portfolios and brand
hierarchies with appropriate sub-brands can be employed to minimise cannibalisation and dilution, and to
optimise equity flows. Despite the problems inherent with vertical extensions, some luxury brand marketers
have succeeded in extending their brands to enter new markets across a range of price points like Armani.
When multiple brands are combined to form a sub-brand, each brand element can vary in the relative
emphasis it receives in the combined brand. The prominence of a brand element refers to its relative visibility
compared with other brand elements. For example, the prominence of a brand name element depends on several
factors such as its order, size and appearance, and its semantic associations.The principle of
prominence states that the relative prominence of brand elements affects perceptions of product distance and the
type of image created for new products. In general, primary brand elements should be chosen to convey the
main product positioning and points of difference. Secondary brand elements, on the other hand, are often
chosen for a supporting role to convey a more restricted set of associations. A secondary brand element may
also facilitate awareness eg. Razor by Motorola.
Luxury brands can thus use brand design elements to 'dial up' or 'dial down' the parent or ma