14. Keep raising the average price of the product range
In traditional marketing, you launch a product at a skimming price, then when competition comes onto the scene, you drop the price. In luxury it is precisely the opposite. A luxury brand must always be seen to be restoring the gap, restratifying, and as such it is acting as a visible agent of meritocracy.
A brand that cannot grow in volume and profitability other than by launching accessible products shows that it is no longer part of the luxury market. For instance, the fact that Mercedes has launched its super top-of-the-range under a different brand name (Maybach -- pictured above) reveals its presumed change of strategy: Mercedes from now on will be the maker of regular and premium automobiles, and the luxury range now goes under the Maybach brand, no longer Mercedes.
This means that while it may be necessary to have a few introductory products for the benefit of new clientele, having a luxury brand signifies a permanent shift in vision. Its growth does not rely on running after less well-heeled clientele but on taking advantage of the global economic growth that is creating thousands of new rich and very rich people throughout the world. These people are looking for a way to reward themselves (through products) and for a symbol (being the brand) of their accession to the ‘Club’, having made sure that it is a closed ‘Club’ – they wouldn’t want to mix too much with the wrong kind of people, after all! That is why the average price needs to keep going up – while of course at the same time increasing the value element of the product or service.
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.
Sponsored By: The Brand Positioning Workshop