mbai q1 08 - philippemihailovich.com · mbai q1 08 prof: philippe mihailovich photo luxury brand...

MBAI Q1 08

Prof: Philippe Mihailovich

www.philippemihailovich.com

Photo www.brandchannel.com

Luxury Brand Management

Luxury branding books

Grading:

Group/other 40% - Create a luxury brand

Final Presentation 60%

Final Project:

Create a new Luxury Brand with Press Release

Our email address:

[email protected] password: luxury

Ruinart?

Dom Perignon?

What is its’ main USP?

There is documentary evidence that sparkling wine was first intentionally produced byEnglish scientist and physician Christopher Merrett at least 30 years before the work of DomPerignon (person) who, contrary to legend and popular belief, did not invent sparkling wine -wikipedia

A Dom Perignon Story

Marketing Managementwww.philippemihailovich.com

Some competitors

by kilian frederick malle

Chanel invite le public place Vendôme

Chanel présente Xavier Veilhan, Elements CélestesChanel haute joaillerie ouvre sa boutique (18 place Vendôme, Paris 1er) au public jusqu'au 10 juillet 2005

De 10h30 à 18h30, découvrez la nouvelle collection de bijoux: "Eléments Célestes". Cette ligne inspirée des merveilles dumonde cosmique - par les astres et les planètes - est composée principalement de diamants et perles.

Cette exposition constitue un moment rare pour découvrir un savoir-faire unique et d'une créativité époustouflante !

Plus de 15 400 diamants, saphirs et perles ornent ces 16 Eléments Célestes pour un poids total de plus de 330 carats.

"J'ai voulu couvrir les femmes de constellations", confiait Gabrielle Chanel en présentant en 1932 ses premières pièces dejoaillerie. "Avec sa densité, le diamant représente la valeur la plus grande dans le plus petit volume", ajoutait-elle à proposde sa pierre préférée.

L'histoire commence par le Mandala, bracelet-manchette, une merveille de créativité et une prouesse technique puisque cebracelet est à transformation. Il donne le ton de cette collection unique qui privilégie le noir et le blanc, le diamant et la perle,couleurs et matières préférées et symboliques de Mademoiselle Chanel.

• Brand building eg CHANEL

Features & Benefits

Left hand brain

MIND: RATIONAL

Imagery & Attributes

Right hand brain

SOUL:EMOTION

Communication CoreProduct Core Brand Core

Couture to R2W

No.5

Lagerfeld

Symbol

Black & White

Rue Cambon

Coco’s character

Accessories,Cosmetics

Glamorousoutrageouswomen

Monroe to Moss

Touch of shock

Jewellery Store,

Hotel?

The Brand Stretching Matrix

Fashion Parfum Make-up SkinCare

HairStyling RetailMen’s

Groom

JewellTime-pBags/ShoesHomeHotelsCars

Perceptual attributes are everything

Digest

CHANEL

ARMANI

LAUREN

PORSCHE

DOMPERIGNON

COSTES

PERRICONE

LADUREE

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?????

? ?? ? ???

??? ? ? ? ? ? ?

? ?? ? ? ? ? ? ?????

?? ? ? ? ? ? ?

?? ?? ?? ? ???

?

HERMÈS

GUCCI

VUITTON

?

?

??????

???

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Building Brand Personality

Key factors:

•Brand Reputation

•Brand Affinity

Brand ReputationSource: van Gelder,S,’Global Brand Strategy’ 2005

• Key is to know which stories will convince consumers that the brand is insome way superior:

- Authenticity, Credibility, reliability - History, legacy, mythology

- Ideally must cross borders or be able to be adapted locally


There are 3 types of reputation qualitites:

1. CONTEXTUAL - brand’s birthright, lineage, creator, founder- provides legitimacy




2. INTRINSIC - built over the years i.e expectations/promises




2. INTRINSIC - built over the years i.e expectations/promises

3. ASSOCIATIVE - qualities attributed to brands through itsassociation with others i.e experts, royalty, celebs, includingother brands - qualities rub off

C I A

Contextual Intrinsic Associative


QUALITIESContextualRelation Intrinsic Associative

Categorytranscendent

Category specific Pedigree brands

Origin brands

Quality brands

Promise brands

Endorsed brands

Personality brands




• Often connected to a region, legacy or founder

• Emphasis on roots

• Has special qualities that cannot be matched

i.e Champagne (product-related place), Ferrari (legacy), Christian Dior (designermythology = prepared to pay premium price), Marlboro - Marlboro Country (‘needfor belonging’)

Note: brand DNA - brand is born with attributes - advantageousand disadvantageous. Layers of meaning must be built on top

Brand Stretching Matrix: eg Beauty BrandsHairCare

JacquesDessange

Wella

Nivea

Dior

NartaNarta

Deo Fragr Make-up SkinBath/Shower

L’Oreal

Gillette

Lancome

HairStyling

HairColour

Wella and L’Oreal both ‘born’ as hair care brands

Brand Visionbuilding from the core foundations

<cleansing….moisturising>

core

sun tan

Cleansers /body wash

baby

shampoos

Sunprotection

Deodorants?

men’s

………………………………>Distancefrom core

Colourcosmetics?

face

body

How far can brand’s reputation stretch?





Origin brands

• Country of Origin benefits -GermanEngineering

• Brand can become symbol of country egMcDonald’s

• Relocating to add ‘place brand’ e.gMaybelline New York

• Fake perceptions eg Haagen Daz,Mecca Cola

• Based on stories, commonly held beliefs,propaganda, myths

Note: brand can be improved or damagedby ‘place’ issues i.e decline of Britishbrands’ quality perceptions vs rise ofJapanese and Korean.

perfumesaccessories

Ready to wearmen

Ready to wearwomen

Homefurnishing kidslinen

Restaurant /hotel

perfumesaccessories

Ready to wearmen

Ready to wearwomen

Homefurnishing kidslinen

Restaurant /hotel

Then goes into hierarchy

Not considered anauthentic luxury brand in

Europe

He did not start out workingfor a great designer

Fashion consumers remain loyal to homegrowndesigners.

Not surprisingly, consumers in the world’s fashioncapitals (USA, Italy, France) remain loyal first andforemost to their own country designers.

•North American consumers remain loyal to top USdesigner Ralph Lauren

•Historic French design houses, Yves Saint Laurent,Chanel, Dior and Hermes have the strongest followingin France now.

•Italians clearly rank Giorgio Armani, Prada, EmporioArmani and Versace among their most coveted fashionbrandshttp://uk.acnielsen.com/news/FashionBrands.shtml





Origin brands

Quality brands

• VW reputation of quality, Volvo safety

• Challenge faced by luxury brands

• Focus on values, purpose, ambitionsnot on personality traits

Note: as brand personality traits most likely to be sioncerity andcompetence, these are often one-dimensional bland brands





Origin brands

Quality brands

Promise brands

Note: social needs - sense of belonging -differs across borders

• Build on reputationsthat transcendoriginal category ieVirgin, Easyjet

• Promise brandsexpress personalitiesin line with theirpledge to consumersie Greenpeace

• Often use founder’spersonality andnormally linked tosocial needs





Origin brands

Quality brands

Promise brands

Endorsed brands

• Wants to emphasise its own achievements by ‘significant’ association

i.e toothpaste - dentist, food - gourmet chefs (always from same category)

• Focus on values, purpose, ambitions of the endorser

Note: Vulnerable to security needs - needs credible endorser





Origin brands

Quality brands

Promise brands

Endorsed brands

Personality brands

• Endorsement NOT specific to category i.e Rolex - Tiger Woods, hairdresser -star, food - royalty etc even fake i.e Ferrero Rocher ambassador - good taste

• Endorsement MUST fit

Note: Vulnerable to actions of star i.e Kate Moss (Chanel vs H&M) and fads

Celebrities easier to replace than professional endorsers

Brand Reputation

Conclusion

• Brand reputation is more important to some brands than to others

• Dutch saying: ‘A good reputation comes on foot and leaves on horseback’

• Brand management has to always look out for erosion of brand’sfoundations and decide when its time to add or shift to another

Brand Reputation

Conclusion

• Brand reputation is more important to some brands than to others

• Dutch saying: ‘A good reputation comes on foot and leaves on horseback’

• Brand management has to always look out for erosion of brand’sfoundations and decide when its time to add or shift to another

Note: Often in fmcg there are TWO brands working together on the samepackaging: The House Brand and the Product Brand

i.e Kit Kat & Nestlé

and sometimes also a PLACE brand

i.e Studio Line from L’Oreal, Paris

HB

PB

LEVEL 1: HB only. PB generic

LEVEL 2: HB umbrellabrand

LEVEL 3: HB/PB master-servant

LEVEL 4: HB as endorsement

LEVEL 5: PB umbrella

The Brand-Bonding SpectrumSTEP1 BRAND ARCHITECTURAL STRATEGY

•Know your enemy better than he knows himself

•Competitive Research must go deep into understanding ofcompetitive brands’ DNA

i.e it’s Core Properties (features & benefits), Reputation, elasticity,brand architecture (HB:PB), Affinity (to be covered next week),Recognition etc

Researching and Attacking Dominant FMCG brands





Origin brands

Quality brands

Promise brands

Endorsed brands

Personality brands

Le Grand Luxe

I love you!

Discovery

ImageAuthenticityGenerosity

SOUL

Relationship as seen by both client and maison

I love you!

•I desire you, I want you, I need you•Can I trust you/•I accept you•Who were you with before?•Who’s your family?•Are we compatible?•I’d like to know you better•Where are you from?•Who?

Brand AffinitySource: van Gelder,S,’Global Brand Strategy’ 2005

Dimensions of Brand Affinity

Functional

Empathy

Ego

Cosmopolitan Emotional Society

Association

Native


Functional

Empathy

Ego


Association

Native

FUNCTIONAL

•To build Functional Affinity a brand needs to focus on what consumersdeem important in terms of functionalities of products and services, andmake a virtue of its dedication to delivering those

•Offers an honest price rather than a low price ie IKEA



Functional

Empathy

Ego


Association

NativeEMOTIONAL

•Based onpositive emotionalaspects such asfun, excitement,romance, love,longing, passion

•The difficulty liesin claiming aparticularemotion, living upto it, and notoverdoing it



Functional

Empathy

Ego


Association

NativeNATIVE

•Pits consumers’senses of localpride against theirfeelings of beingworld citizens

•Patriotism,regionalism,ethnic backgroundor even urbanversus rural pride



Functional

Empathy

Ego


Association

Native

COSMOPOLITAN

•Cosmopolitanaffinity is basedon brands beingregarded asinternational

•Expresspersonality traitssuch assophistication,superiority,refinement,uniqueness,origiality andmodernism



Functional

Empathy

Ego


Association

Native

EGO-Orientated

•Pleasure,indulgence,individualism, egotism

•Need for self-esteem, ie L’Oreal -‘Because I’m worth it’

•Values such asnovelty, pleasure-seeking, hedonism,and health



Functional

Empathy

Ego


Association

Native

SOCIETY

•Build theirconsumerrelationships onpublic issues

•Choice betweenvalues-led(philiosophy-whatbrand stands for)or cause-led(choose a specificcause to support)



Functional

Empathy

Ego


Association

NativeEMPATHY

•Empathy brands areable to understand andcater for specificcustomer requirements.Personalisation.

•Need to have intimateconsumer knowledge inorder to understandhow to tailor toconsumer needs - togive customisedcustomer experience



Functional

Empathy

Ego


Association

NativeASSOCIATION

•Brands that peoplewish to be seen with,wish to let everyoneknow they own - eg aHarley gives owners aunique form of self-expression and alsomembership of group;

•Express traits such asexiting, cool, ambitious,off-beat, aspirational,exclusive experiences

•Often provide sense ofself-esteem




Functional

Empathy

Ego


Association

Native

Which steps should we take to build our layers ?

Our Brand vsCompetitors before


Functional

Empathy

Ego


Association

Native


Our Brand vsCompetitors after


Functional

Empathy

Ego


Association

Native


Message 2:

Message 3:

Message 1:

Relaunch?

De Winter and Sier

mbai q1 08 - philippemihailovich.com · mbai q1 08 prof: philippe mihailovich photo luxury brand...

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