Academic journal article IUP Journal of Brand Management

The Underpinning Strategies Leading to High Value Perception of Luxury Fashion Brands †

Academic journal article IUP Journal of Brand Management

The Underpinning Strategies Leading to High Value Perception of Luxury Fashion Brands †

Article excerpt

Introduction

The luxury market has, in recent years, continued to grow substantially and has been helped by the growing appetite of emerging economies. In a time when consumer demand in Western developed markets appears to be buckling under the pressure of recessionary trend (Gapper, 2009), the major luxury powerhouses have found opportunities for extensive growth in emerging markets.

Looking at consumption patterns, one must acknowledge that they are not the same all over the world. Consumers perceive the values associated with luxury from the perspective of their own unique cultural background (Li et al., 2011). Due to the high supply and vast choice available in the various segments including luxury goods, consumers nowadays, are no longer loyal to one single brand, but they prefer to choose and have a demanding and critical attitude towards exactly what they want to purchase (Okonkwo, 2007).

By looking at the recent transformation in the globalized and ever more connected world, we can see that the luxury market has expanded from limited availability to a select group of consumers (the few who could afford the price) to a market with more persons of even moderate means having access to the products (Okonkwo, 2009).

According to Danziger (2004), "...'old luxury' was about the attributes, qualities and features of the product and much of its appeal was derived from status and prestige. The new luxury consumer defines the category from their point of view. Today's new luxury consumers focus on the experience of luxury embodied in the goods and services they buy, not in the ownership itself."

Ricca and Robins (2012) proposed an alternative perspective on the established new versus old luxury dichotomy. According to the authors, as more brands define themselves as belonging to the world of luxury, and as luxury thus becomes 'massified', the concept becomes meaningless. They introduced the concept of meta-luxury as a new form of luxury that escapes the cliché of luxury and establishes the luxury beyond luxury.

This paper seeks to make a contribution by proposing a revision to the definitions provided by various authors. It seeks to establish patterns and inconsistencies and to summarize these in a framework that could be used to clearly identify the constituents of a luxury brand. These summarized constituents define the direction of the underpinning strategies of luxury brands with high value perception from the consumers and are intended to lead to a consistent measurement tool that could be used in the evaluation and classification of luxury brands for both emerging and established markets.

Luxury Across Established and Emerging Countries

Thanks to growing demand among the burgeoning middle classes of China, Russia, Brazil and India, in 2012, consumers around the world indulged $58 bn a week on luxury goods, 4% more than in 2011 and almost 22% more than in 2007. The BRICs offset a lacklustre performance in developed markets with a combined retail value of over $33 bn in 2012. They now account for 11% of total luxury sales, up from just 4% in 2004. By 2017, this figure is set to increase further by 78% in real value terms to reach $59 bn, representing almost 16% of the global luxury goods market (Euromonitor International, 2013).

Data shows that the luxury market has not suffered from the financial crisis as much as other sectors. According to the chief executive of the magazine, Luxury Briefing, "We're in the middle of the maelstrom now, which affects confidence, but luxury is a long-term business for the brands involved. The customer base is broader than it was with some brands having more than 200 stores worldwide [, and] emerging markets may counteract the stagnation of some of the more mature markets" (Fellowes, 2008).

As previously stated, luxury brands in particular are known to be shaped by cultural and historical heritage (Mason, 1993; Assouly, 2005; Sicard, 2005; and Kapferer and Bastien, 2009). …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.