Tuesday, May 5

The value of luxury goods

bvlgari jewelleryTo make money 60 billion U.S. dollars of global luxury goods market than ever before, more stringent or more valuable. Competition is very keen. And changing consumer preferences, resulting in the concept of luxury itself change over time. As a result, the market's most recognizable brand has to adapt to an entirely new product lines and expanding their own brands to cheaper goods.

Intense pressure to innovate, Nancy said that the Harvard Business School Professor Kane Floor, bvlgari jewellery business historian and author new: how entrepreneurs earned the trust of consumers, Dell Wedgwood. "Now people are using to assert a more active consumer who they are, social, psychically, and culture," Remarks Kane. "As a value proposition, luxury is a very sensitive time and self."

Adaptation, however, is a high-risk business. "You can not rely on consumer research, the extent of the same, you can say that in other markets," Harvard Business School professor emeritus Walter Salmon scholars, experts, consumer marketing and retail distribution. He cited the "cultural sensitivity" the ability to know what consumers want, and then to know its own as a key attribute of success.

Factor requirements, consistent quality, innovative design, supply logistics, and the need for superior customer service, and easy to understand why David Birnbaum (Harvard Business School, MBA'74), the private jeweler, will be sound this warning note: "It sounds very interesting luxury, but you must be careful. This is not enter lightly. you need a real, serious, sustained commitment to the pinnacle of film and to maintain and promote your position If you make it happen. "

As a value proposition, luxury is a very sensitive time and self.
- Nancy Kane Floor

However, the challenge of luxury is still an ongoing temptation Birnbaum interviews with alumni and other articles. "Luxury is a highly creative field," Note Baorui tons Tranthi (Harvard Business School, MBA'93), President of the United States, Thomas Pink, the London-based shirtmaker. "Many brands started small businesses. This is a field of constantly changing, which often have significant opportunities."
Evergreen challenges

A symbol of heritage and prestige of many luxury brands, some of which are several hundred years of history. Especially the quality of the immortal part of luxury goods, you can appeal, but consumers, especially the young, fashionable consumers, the products you want to look fresh and unexpected. How to maintain its brand and attract new followers, without losing its core the following?

"We can still accommodate the traditional customers, because our style is a typical example of that," Matthew McEvoy (Harvard Business School, MBA'89), Director of Strategic Planning Burberry. Founded in 1856, the creators of the classic trench coat has been equipped with movie stars, outdoor athletes, the British military, and members of the royal family. In 1997, Burberry has launched a revitalized brand to display the ongoing appeal of its products eternal, but also to fashionable clothing and accessories for men and women. "You can always buy the classic trench coat. But we are introducing the product, an increase of more modern style, so you do not need appreciation in the 50 to say that we are doing," McEvoy. Today, Her Majesty Queen Elizabeth II wearing her Burberry trench coat. However, there is no model Kate Moss.

CEO of Waterford Crystal in the John G Dover (Harvard Business School ISMP'89) brought about by contemporary designers like Versace and Vera Wang to create a new model, China will maintain the attractiveness of the brand, a new generation of customers. "When they believe that a fine crystal and the majority of young people to remember their mother said, 'Do not you dare touch it," Remarks welfare. With the consumer from the more formal dining experience for leisure and entertainment, welfare, said that his company's brand, the need to preserve the quality of their expectations, while maintaining its relevance in people's daily lives. "Luxury goods in order at home or abroad as well as their mind is how we are," he explained.

"Any challenge to that evergreen brands," Haupt Sports Wikipedia (Harvard Business School, MBA'79), a senior adviser to Steuben Glass in New York who is running his own consultancy. "This is a great art, in order to determine what relevant means to your brand, while maintaining its heritage alive. This is a problem to meet the needs of existing customers and attract new customers." In Steuben, Haupt said , there is a continuous assessment of the appropriate balance between form and function of the product and how to meet the people living today.

In the past, she pointed out that this was set up on tables and coordination rigueur, the cutlery and glassware. Select a model is a very important decision, because people live in this decision for some time. Today, the campaign is set up does not belong to "matchy match"; new Steuben glass production lines to work together to meet the needs of consumers who would like to have differentiated, personalized look and feel.

"People living in different today," Haupt. Asparagus tongs, for example, a thing of the past. Multi-purpose projects like the Magnolia Steuben bowl, which doubles as a caviar server, turned off the demand.
Emotional purchase

Retail therapy is a relatively new term for not so new phenomenon. In short, this is the act of shopping, so we feel better. Part of the experience is to find and purchase what is right, it is equally important component of the chase is exciting, sensory experience of entering the store and was surrounded by light, color, texture, and sound.

In February this year, Louis Vuitton on this premise to a new level, opening up a 4-storey and 22,000-square-foot Fifth Avenue boutique design architect Peter San Marino function details, such as flashing LED screen and a bronze and chestnut staircase. (Scheduled to open a bigger store in Paris in December.) Location of products, "wow" factor may not always translate into hard sales, but the image is very important in the world of luxury. To the first impression is essential.

"I want to ensure that its clients have a good feeling, was sent to different places, they enter our stores," said Thomas pink Tranthi. Inspired by the technology of the late 18th century London tailor (if you wear one of his hunting coat, you are considered to be "in the pink"), Thomas Pink combine elements of the English club (mahogany trim and neatly pigeonholed shirt) and a novel and fun.

"There is a huge wealth of colors and patterns, so that, like a candy store, so you want to come in and treat themselves," she said.

In addition to the quality of fabrics, design, cutting, people who buy other assured Thomas Pink, Tranthi said: "I want to wear this shirt, which will let me feel very good. This is the luxury brand command a premium, this is an emotional purchase. "

Luxury is actually a highly creative area.
- Chui tons Tranthi, Thomas Pink

Needless to say, the core of customer service, shopping experience. Tranthi added that she approved the sale of each assistant employed for each of the Thomas Pink store 10 the United States. "This is the most critical positions in the company," she said. "They carried out the interaction between customers and products mediation. If mediation is not a good one, be it the entire brand."

"This is the leading customer experience through a new feel and comfort at the same time said," The Steuben Haupt. "Finally, they have to buy or not, so that they feel happy temptation? What satisfaction and unforgettable experience, so that they would like to return?"

Mr. Jennifer Park (Harvard Business School, MBA'97), director of innovation Godiva chocolate shop explained that the process of Godiva, top-down refresh of its brands, will involve the adjustment of their products, packaging, advertising, site, boutiques to create a more modern, relevant, and luxurious appearance to attract customers. In the same spirit, in the "School of Godiva passion," a free course of the Godiva store in February in the history of chocolate, chocolate taste and flavor pairing, chocolate decoration techniques.

"It involves a leader in appreciation, and to give our customers a real, value-added experience to connect learning and classification," the views of the park.

David Birnbaum simple tourists Office 57th Street in Manhattan will not mistake their palace of Tiffany or Harry Winston, but low-cost, low-profit work the way a lot of U.S. financial and commercial elite. Repeat business and referrals make up the majority of customers of their company's rare gems, the majority of sales on average between 50,000 U.S. dollars 150,000 U.S. dollars. Birnbaum tells the story of a potential customer in the market for 5 or 6 one-carat diamond found a reasonable price, so he returned to the consideration of, and eventually buy 10-carat range.

Birnbaum pointed out that this particular customer first contact with the company 5 years ago. In a relationship-intensive business services, communication, and institutional memory are necessary, but not enough, he said. Ultimately, the quality and beauty is supreme. "Nuances in the fashion and design are always changing, so you need to carefully listen to the market. If I can open and listen like a child, I will win."
Products, product, product

Perceived value through design quality, materials and manufacturing, is another important component of the luxury equation. "If it was 100 U.S. dollars to the towel in front of you and is easy to see what 100 U.S. dollars so that the towel? The product speak for itself, said:" Haupt, who started as a buyer at Bloomingdale's before Chief Executive Officer and President of Nantes Ma劳布(Harvard Business School, MBA'49).

"This is a very competitive market, more competitive access to the time said," Burberry's McEvoy. "Whether you are new or provide some long-standing classic, boiled down to its real product. Product is king. Quality is essential."

"Throwing objects around the money will not have a luxury brand, it just caused a lot of noise, said:" David Birnbaum. "I think people sometimes forget that you must have a great product behind a luxury brand, not a good product, a great product. If you can sell the experts, you can eventually sell the world," he said. "But this is a good line to be sold to connoisseurs, rather than director of the Smithsonian."

These days, it seems that more and more products that have been raised to a level of appreciation. Turned into a commodity affordable luxury, Starbucks has shown that a large number of high consumer demand for product differentiation and the development of a specific place of origin, said, Godiva's Park. Concessions have been spread to other goods, including handmade chocolates. The introduction of Godiva's G series, the design of a premium line of chocolate pastry chef Norman Love, is a way to enter the space.

Finally, they have to buy or not, so that they feel happy temptation?
- Wikipedia sports Haupt, Steuben Glass

"With the consumer's knowledge and appreciation of chocolate developed countries, the hope that the voices of Godiva, continue to lead the category of a unique and premium way," she explained. "This is for innovation to take chocolate related to a new level. The creation of the Group of Eight challenges of collecting information on consumer expectations and the strengthening of Godiva's Godiva as a brand, the provision of novel and discover." The fact is that it costs about 100 U.S. dollars and only applies to pound from November to February is no doubt caused by the lack of a atmosphere, only increased his appeal. In luxury, an increase of the balance of the park has always been the relationship between the quantity and exclusive. "The definition of luxury is different people based on their value," she said. "This is the people to pay more of the goods is very special, as well as the brand and experience, which means that things in their lives."

"More and more, we have seen the end of the consumer is in our personal lives and experiences with others," Professor Kane. "Big brands are on the psychology, not only large-scale advertising signs or clean." Scope of the Arab-Israeli piracy, for example, can represent a meaningful time to prepare meals with family and friends, not only 10,000 U.S. dollars a quality restaurant stove. Creation, marketing and sales of the "killer application" of the product, the quality of access to meaningful, in an increasingly crowded, noisy market is the luxury of continuing to enjoy the challenges and alumni who maintain their finger the pulse of culture, its own reward.

"For any good businessman, the world is the charm of an ever said," The Steuben Haupt. "It is fascinating to all of its political, economic, popular culture and how it is calculated into the next step will be to find. That is why I like so many in the industry."

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