The Anti-Laws Of Luxury Marketing #15

Jean-Noel KapfererOctober 29, 20092 min

#15. Do not sell. This isn’t arrogance, not at all. The luxury strategy is the very opposite of the volume strategy.

If you pursue the strategy of systematically raising all your prices, as illustrated by Krug, you have to be prepared to lose sales and to lose customers. Most brands don’t dare risk it, or else go running after customers; when you get to that point you’re no longer talking luxury but mass consumption – which of course can be extremely profitable as everyone knows.

Krug did lose some accounts, some importers, it is true. If not supported by the Rémy Cointreau management in the steps it took, Krug’s change in strategy would have been stopped as soon as the first big client walked away. In luxury, not trying too hard to sell is a fundamental principle in relations with customers. You tell the customer the story of the product, the facts, but you do not pressure them into making a purchase there and then.

We said a few words earlier about the campaign BMW had conducted on the internet in the US; a number of the most prominent film directors each made a short-length film around BMW, having been given completely free rein – not a commercial, but free expression. These films were made available on the internet and they very quickly did the rounds in the United States. Commenting on this decision, the marketing director at BMW USA said:

When it comes to luxury, the best way of reaching the very well-off is to let them come to you.

Excerpted in part from: The Luxury Strategy: Break The Rules of Marketing to Build Luxury Brands by JN Kapferer and V. Bastien, in partnership with Kogan Page publishing.

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One comment

  • Debashish Brahma

    October 30, 2009 at 7:15 am

    Excellent post. Brand creation by eliminating/ignoring ordinary people, some times extraordinary people, increasing the price over a period of time also need confidence of the firm in their product or services they cater.

    For that reason customers, will pay for a firm’s product and services at a extra-premium that the firm commands.

    As stated in the above case of BMW, it’s a PULL strategy that can only work when a firm executes luxury branding.

    The seller will be in a high bargaining position, not the buyer.

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