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Experiences and story, the foundation of luxury marketing offers
Posted by Michael Cage on Wednesday, February 14, 2007Exceptional experiences that pack a story to tell are the new luxury marketing offers. (And there is a lesson here for all businesses, marketing to the affluent or not, so read on.)
People with disposable, six-figure incomes are spending money on luxury goods that used to be reserved for the "upper crust" of society. These are the mass affluent, and they have been written about in exhausting detail.
Ages ago, in order to come away with that uber-trendy LV bag, you had to go to a boutique where you were treated like a king or queen before receiving your prize. At full retail price. Nowadays, it is as likely to have been purchased at CostCo or a discounter on the web.
This democratization of luxury goods has destroyed a major selling point: Exclusivity.
Cynical or not, most luxury goods are sold at a premium in large part due to the social message they communicate. When "everyone" has access to what used to make your social group "unique" ... the symbols begin to lose their meaning.
BTW, in case you have your nose up at the "snobs" who would drop $2k on a handbag to show off ... keep in mind that everything from tribal tattoos, hybrid vehicles, fair trade coffee and Apple Computers are sold the same way.
Identifying your "tribe" through your "stuff" isn't a rich person's disease ... it's a condition of social humans. You and I included. Deal with it.
So ... with luxury goods becoming less exclusive and more available with every passing day, their value as symbols decreases. When that happens, the people who used to value the symbols seek out the next big thing.
Today, that "thing" takes the form of experiences.
The value of an experience is not limited to the experience itself. It includes the story you get to tell about the experience from that point forward.
Two weeks ago, I flew home from a speaking gig in Dallas.
I'm not a "suit guy" ... but the man sitting next to me had a stunning suit on and I told him I loved it. What followed was a 30 minute discussion about how he had flown three times to London, spent the better part of a day each time with a Saville Row tailor, and almost 9 months later this suit was the result. Good story.
He almost certainly paid upwards of $10,000 for the entire experience.
Could he have have received a similar quality suit from a Washington D.C. tailor (or a Saville Row tailor who travelled to DC)? Certainly. For less money? Absolutely. But would it have been nearly as good a story to tell? Not even close.
Let's turn this to geek culture.
Everyone in the blogging world is aware of Hugh's project with Thomas Mahon, English Cut. Is there anyone out there who does not believe that an English Cut suit does not carry a premium in Silicon Valley ... not only because of the quality ... but because of the story it allows the wearer to tell? Ozwald Boateng may be hot stuff in LA, but my money is on English Cut being the one people in the cutting edge world of tech "get."
In case you are wondering, I'm not writing all of this to talk about going bespoke.
I don't care what you sell. When you engineer your offerings to include an exceptional experience and a great story to tell about it ... you have a point of differentiation and the seed of incredible word-of-mouth marketing it'll take ages for the competition to catch up to.
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This is exactly the trend we’re seeing in insurance sales. High-end services like a concierge service is now becoming the “norm.” I spot trends in the insurance industry and this case illustrated above is certainly not one vendors and agents should miss! Great post.
Nancy Germond on Monday, February 26, 2007I fully agree with Michael that people are looking for the experience. I am always advising my clients to look for ways to enhance the buying experience for their customers. People also want to be a part of something “cool”, which is where the story comes in. Bring the customer into the story and you will have him.
Steve Chambers on Tuesday, March 13, 2007What I’ve found surprising in my work with clients serving affluent markets is that there are two kinds of affluent buyers: 1) truly affluent and 2) “aspiring” affluent.
It’s the aspiring affluent that’s spending money to keep up with Jones and appear affluent. When you look closely at their finances, they are spending money they don’t have, on things they don’t need, but desperately do want.
Victor Cheng on Saturday, April 14, 2007I agree. There are many products I buy which I like but don’t talk about. If any product or service includes an experience of some sort, perhaps created to make people talk positively, then it can only be a good thing.
I suspect that adding this experience to most companies delivery probably won’t cost that much.
This has inspired me to look again at ways of improving our experience at the point of consumption to make people’s experience superior.
Ian Denny on Saturday, February 16, 2008Amen to that! A suit maybe cost ten thousand bucks but it says ten thousand things about you.
Contents Insurance on Thursday, February 21, 2008I think the removal of exclusivity for luxury goods may have some benefit.
Democratization mean that luxury goods can be accessed by a wider range of consumers. In my opinion that’s what a marketer really after.
This way, the product can be sold more rapidly.
Randy on Sunday, February 24, 2008Wow could have not said it better myself.
Services on Monday, February 25, 2008It is complex to judge such act…
Rezak on Saturday, April 05, 2008Clause is perfectly made, it is useful to esteem.
Arkadiy on Saturday, April 05, 2008Nice opinions
rezak on Wednesday, April 09, 2008