Luxury Institute News

March 3, 2012

What DiorMag says about the brand

By Rachel Lamb
Luxury Daily
March 2, 2012

French fashion label Christian Dior announced the launch of DiorMag, an online magazine that positions the brand as an innovative storyteller, entertainer and purveyor of the height of luxury products.

DiorMag is available as a section on the Dior Web site and includes articles, images, current news and product galleries. DiorMag has the potential to secure brand loyalists and drive transactions, per experts.

“I think what the magazine does is that it tries to  create a lot of relevant and interesting content about the brand and the people behind it,” said Milton Pedraza, CEO of the Luxury Institute, New York. “Therefore, it’s a great vehicle for storytelling that educates and entertains consumers and that enhances the opportunity to have consumers be loyal to the brand because they know the story behind it.

“It meets the criteria for great content, it’s not purely infomercial,” he said. “In this case, it’s well-optimized because it’s telling its own stories with objectivity and decorum, not just a hard-sell.”

Mr. Pedraza is not affiliated with Dior, but agreed to comment as an industry expert.

Dior did not respond before press deadline.

Dear Dior
DiorMag is split up into a few sections including report, monsieur Dior, Dior over the world and all about Dior.

In those sections are topics including woman, Dior Homme, baby Dior, fragrance, makeup, skincare, jewelry, timepieces and Dior phone. These are the sections of the Dior Web site.

Clicking on a topic or section pulls together all of the relevant articles.

One article currently on-site is “in real time,” a live-stream of the fall/winter 2012-2013 ready-to-wear collection today at 9:30 Eastern Time.

Another piece is “Miss au Pluriel,” a video and image gallery of brand ambassador Mila Kunis and the Miss Dior handbag campaign (see story).

The story “2012-1947: Now, then and back again” fully relays the history and depth of the Dior brand, which is a very important part of the magazine.

“Most media is undergoing rapid transformation today as digital convergence keeps lending to new ways for storytelling. interaction and innovation,” said Paul Farkas, president/CEO of Social.TV, New York.

“Luxury brands are now all high-powered media houses and digital magazines are one key way to attract consumers with enhanced and extended content,” he said.

Storied telling
DiorMag is one in a few brands that are upping connectivity through online publications.

For example, French fashion brand Chanel’s Chanel News site has a presence as its own site as well as on the brand’s mobile application.

Consumers can learn about the brand history, catch up on current news and see exclusive content.

In fact, Chanel’s new video for its Boy handbag collection, “My New Friend Boy” was released on the Chanel News site (see story).

In addition, Christian Louboutin has its own “Louboutin Times” newspaper that it uses to relay information and exclusive content.

“This is the next generation of digital marketing,” said Chris Ramey, president of Affluent Insights, Miami.

“Ease of shopping, along with speed and pleasure, add value to luxury brand magazine,” he said.

However, there are some drawbacks to a digital magazine.

“There are some clunky areas that will be fixed, and their contents page will become more attractive,” Mr. Ramey said. “A couple times I found myself back on the site rather than the magazine – and it wasn’t always natural where to explore next.”

However, Dior, Chanel and Louboutin have something that other brands do not – their history.

Legacy and heritage are two of the main weapons that old luxury brands have in their arsenal, per Luxury Institute’s Mr. Pedraza.

“This isn’t for every brand,” Mr. Pedraza said. “If you’re not well historically-endowed, you’ll have a hard time getting this across.

“However, Dior is fortunate that it has this legacy that it can draw on and contemporize,” he said.

http://www.luxurydaily.com/what-diormag-says-about-the-brand/

November 18, 2011

Luxury experiences not up to product standards: Luxury Institute

By Rachel Lamb
Luxury Daily
November 17, 2011

Luxury brands are having a hard time matching high-quality products with premium experiences, making it difficult for them to retain affluent customers, according to findings from a report by the Luxury Institute.

Customer retention is a saving grace in times of economic uncertainty since providing great experiences is what will make consumers continue buying. Personal relationships and experiences are key to this type of success.

“Products have never been a problem,” said Milton Pedraza, CEO of the Luxury Institute, New York. “The industry has gotten its act together and put out superb products in terms of craftsmanship, design and quality.

“But the problem is how to create a relationship from a human perspective,” he said. “When Zappos can out-behave luxury brands in service, there is a huge opportunity to improve human interaction.

“Wealthy shoppers want to engage with luxury brands and are willing to give them personal information if it means that it will increase their customer experience.”

Can spam

A few brands have made an impression on luxury consumers by delivering superb products and customer service.

Approximately 86 percent of consumers do not mind providing personal information to luxury firms if the result is a superior experience, according to the study.

Furthermore, 77 percent will give their email addresses and 50 percent are willing to share product preferences, birthdays and anniversary dates.

The problem is that brands often do not reach out to customers in the right way or in the right increments.

“Luxury brands spam their customers every day, and they get turned off,” Mr. Pedraza said.

“If you earn the confidence of your customer over time, you should be able to text them or call them and that is the human interaction that generates transaction and sales,” he said. “If you just send offers on a mass basis without differentiating, it really is just spam.”

There are some brands that have gone above and beyond, according to the responses by consumers in the Luxury Institute study.

Four Seasons, Ritz-Carlton, Marriott and NetJets excelled in the travel and hospitality category, while fashion brands such as Gucci, Jimmy Choo, Ralph Lauren and Rolex were at the top of their sectors.

Brickbats

Debt crisis in Europe and in the United States slowed spending during October, but not so much that sales went into negatives.

Nordstrom’s same-store sales rose 5.4 percent in October, but decreased from a 10.7 percent increase in September.

On the other hand, Saks Fifth Avenue’s comparable sales dropped to 1.8 percent in October from September’s 9.3 percent gains.

Meanwhile, Neiman Marcus reported comparable sales that grew 6.4 percent for three months ending Oct. 30.

“Customer retention is in the 10 percent–20 percent range, which is pretty dismal,” Mr. Pedraza said. “There is a lot of slowing all over the world, and BRIC markets have masked the fact that the luxury industry is slowing down dramatically in Europe and a risk of a slowdown in the U.S.

“When there is less growth, the more urgent it is to hook return customers,” he said.

The best way to do so is to provide exceptional experiences. These can come in many forms.

For example, notifications by email of early sales went out to 39 percent of wealthy shoppers this year, down from 45 percent in 2010.

Consumers do want emails, but would prefer if they were customized, the study said.

Another type of personalized service that has increased over this year is the availability of free shipping on purchases and returns.

Retailers such as Gilt Groupe and Nordstrom have used this technique to up their customer service

This is the most important “special touch” offered by luxury brands, according to the Luxury Institute.

“There is so much opportunity in the industry to retain customers,” Mr. Pedraza said. “The biggest opportunity is to take the data that is collected and use it to build long-term relationships.

“The more you know about a customer, the more you will be able to customize the offers, whether it is with a handbag or ready-to-wear,” he said.

“There is a huge opportunity, but it is being wasted by a lot of luxury brands.”

http://www.luxurydaily.com/luxury-experience-not-up-to-standards-with-products-luxury-institute/

November 14, 2011

Wealthy U.S. Shoppers Weigh In on Personalized Service, Rank Luxury Brands in 16 Categories for Ability to Deliver ‘Over the Top’ Customer Experiences

(NEW YORK) Nov 14, 2011- U.S. shoppers earning at least $150,000 want to interact more closely with luxury firms, but not all brands are meeting the demand. This is among the findings of “Luxury Clienteling 2010-2011,” a new WealthSurvey from the independent and objective New York City-based Luxury Institute.

Most wealthy consumers (86%) are willing to provide personal information to luxury firms if it results in a superior experience. More than three-fourths (77%) are happy to supply their email address.

One type of personalized service found to be valued is the availability of free shipping on purchases and returns, a seemingly small but monumentally important feature.

“Consumers view free shipping as the most important ‘special touch’ that luxury firms must provide,” says Milton Pedraza, CEO of the Luxury Institute. “Nordstrom began offering free shipping and returns in August, and it’s surprising that more firms don’t do the same.”

Below are the top-ranked brands for delivering “over the top” experiences in each of the 16 luxury categories:

Leisure Travel: Hilton, Marriott, Four Seasons and Ritz-Carlton
Private Transportation: NetJets
Wine/Spirits: Grey Goose, Dom Perignon and Mondavi
Jewelry/Watches: Rolex
Home Appliances: Viking, LG, GE, Bosch and Subzero
Home Furnishings: Ethan Allen
Health & Fitness: Bally’s
Beauty/Skincare/Grooming: Clinique and Sephora
Designer Shoes: Gucci and Jimmy Choo
Designer Handbags: Coach
Fashion Apparel: Nordstrom, Gucci and Ralph Lauren
Fashion Accessories: Gucci, Coach and Oakley
Autos: Mercedes, Lexus and BMW
Technology: Apple
Personal Finance: Fidelity
Real Estate: Century 21

For greater details on clienteling best practices, visit LuxuryInstitute.com.

About Luxury Institute (www.LuxuryInstitute.com)
The Luxury Institute is the objective and independent global voice of the high net-worth consumer. The Institute conducts extensive and actionable research with wealthy consumers about their behaviors and attitudes on customer experience best practices. In addition, we work closely with top-tier luxury brands to successfully transform their organizational cultures into more profitable customer-centric enterprises. Our Luxury CRM Culture consulting process leverages our fact-based research and enables luxury brands to dramatically Outbehave as well as Outperform their competition. The Luxury Institute also operates LuxuryBoard.com, a membership-based online research portal, and the Luxury CRM Association, a membership organization dedicated to building customer-centric luxury enterprises.

For Further Information, Please Contact:

The Luxury Institute, LLC
Martin Swanson
Vice President
(914) 909-6350
mswanson@luxuryinstitute.com

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