Four For Friday (29)

The luxury sector is negotiating the tight rope between its traditional exclusivity and the open-all-hours, democratising nature of the web. It is a fascinating space to watch as new ways of enticing and engaging with the customer emerge.

This long Luxury Society piece explores the emerging influencers and how brands are finding their feet in this new dance. The most telling line in the piece:

“The internet is a chance for luxury, because in order to maintain the dream value of the brand, you have to permanently refuel that dream…”

Refuelling dreams repeatedly is easier when the shop front is really open-all-hours as the web makes possible.

Relevance. As thing go digital at a rapid pace, relevance is the holy grail for luxury brands too, as Rebecca Robins writes.

An even more fascinating movement among the legacy brands is the movement across brands – the “brand tangos” that boost their reputation through collaboration. Think the Apple Watch Hermès cross-over. Legacy brands are tapping into tech brands to increase awareness and connect with consumers. Tech brands are tapping into legacy brands for their heritage and exclusivity.

The resulting blurring of boundaries increasingly calls into question whether we will even be defining brands by sector in years to come.

Talent is central to this ongoing quest for relevance. Lately luxury brands have been poaching talent from among mass market brand leaders. The skills at a premium? Time to market and omni-channel reach.

“Traditionally reliant on in-store experiences, the luxury end of the market is slowly realising that online retail is a crucial factor in future growth. .. Luxury brands are looking for broader retail skills to match today’s omnichannel retail world, Twyford said.”

“Twyford explained that luxury brands pale in comparison to the likes of Uniqlo, H&M and Zara when it comes to their speed to market. As mass-market brands soar in their ability to maintain low-costs while still appealing to millennials, logo-reliant brands like Ralph Lauren feel static,..”

And finally, a luxury good we all desire more of — silence. The essay discusses advances in airlines and automotives, to create silence which may be physically nauseating — our vestibular system draws upon noise to give us a sense of balance and spatial orientation —  and ends on a note which summarises why silence is truly a luxury good.

The hushed halls of affluence buffer the rich from the hubbub of poverty, but for the poor, the clatter of modern life—like other forms of pollution—is inescapable. And as noise continues its inexorable advance into the quietest eddies of wilderness, even the rich may find a silent retreat impossible to locate.

Bonus link: An impossible to locate silent retreat is what Rachel Nuwer found when she set out to locate the last place on earth without human noise. Two fascinating nuggets stand out:

Hempton and Krause hope that nations will adopt a quiet area program akin to dark sky programs. They are pushing for the US National Park Service to adopt such regulations in 2016, in time for the agency’s centennial. “I absolutely believe we will have our quiet places,” Hempton says. “Just like we went through with water quality, things have to get really bad before we recognise them as a basic value and clean them up.”

Where others tend to become uncomfortable in the disconcerting silence, Foy relished the chance to be completely cut off. But minutes into his stay in the chamber, he noticed that the silence was in fact broken. His own body, it turned out – his breathing, his heartbeat, even the scratchy sound his scalp made rubbing against his skull when he frowned – was betraying his quest for auditory nothingness. “The only time you’ll hear absolute silence is when you’re in no position to hear it, because you’re dead,” he realized.

Luxury’s other heritage challenge

“You never actually own a Patek Philippe. You merely take care of it for the next generation.”

This well-known Patek Philippe tag line tells its customers that the brand’s heritage could be part of their own as they bequeath their Patek timepieces to their future generations.

Patek Philippe Generation Ad campaign

One can, of course, buy pre-owned Patek Philippe time pieces from dealers, or at auctions where the brand commands huge prices, which Patek no doubt monitors. The presence of complete documentation, including owner history and service records, adds to the heritage angle, hence the price tag. Patek also supports collectors’ clubs and offers to service any Patek, no matter what its journey to the present owner has been.

Brands such as Vacheron Constantin engage actively with not just the customers, who already own their watches but also those, who aspire to own a Vacheron timepiece one day.

That said, there are brands, who do not really do much for, or with, collectors.

Hermès comes to mind.

While active in developing, protecting and promoting its own brand image, Hermès famously does not support collectors’ clubs. There is still a brisk trade in second-hand Hermès scarves, bags and other artifacts. It is often difficult to verify if these goods are authentic or counterfeit, or even stolen (although the latter may be rarer).

Most established luxury brands’ own stories focus on the brand heritage. It is fascinating — and puzzling — however to see how little luxury brands do to honour (track?) how their customers create a story about these brands, steeping the luxury goods in their own family’s heritage.

This is a missed opportunity.

To create a luxury brand with longevity beyond the next season has to go beyond the brand extolling its own heritage. The stories that live on have to make sense, and be meaningful to those, who own and wear the products created by that brand.

And while everyone can participate in the democratic medium of the web, oral traditions and stories of familial heritage can still help preserve exclusivity for luxury brands, most of whom are still struggling to make up their mind on the matter.

Indeed one has to ask whether the idea of a heritage driven European brand of luxury has economic viability now that most of their growth is coming from Asian countries, many of whom boast a rich heritage going further back than any European brands!

Can lazy — even arrogant — brand marketing as luxury marques, reliant on their European heritage legacy, do now continue?

Don’t mind me though!

I have a simple curiosity.

I am just keen to hear from someone, whose family bought Hermès equestrian gear and riding equipment 300 years ago, and who is still wearing Hermès couture or carrying Hermès bags today.

(Thanks to Barbara Houdayer for the Twitter conversation, that sparked this monograph.)

Authenticity, genuineness and the luxury brand

A friend of mine is a genuine, passionate Porsche fan. Awaken him from deep sleep and start asking him about the Porsches he has owned through the years, and you begin to see how deep his fountain of knowledge, and his genuine affection for and attachment to the brand run.

Porsche North America Welcome KitHe showed me the letter that he received with his car. The opening paragraph talks about how Porsche is an exceedingly rare breed of automobile and continues to extol its virtues as follows:

“One born in the art of hand craftsmanship, with sporting bloodlines as genuine as the exhaust note. Every Porsche we build is a monument to authenticity … and the kind of unflinching performance that transforms the daily driving routine into one of fun, freedom and pure excitement.”

In the above, the bold is mine, the ellipsis theirs.

This is how the OED defines “genuine”:

adjective
1. Truly what something is said to be; authentic:
2. (Of a person, emotion, or action) sincere:

As I sat rifling through the pristine, understated luxurious contents of the welcome boxes  — he keeps them all — the conversation turned to engine sound enhancement technologies. My friend told me about the Porsche sound symposer, an intake sound amplifier now fitted into the new 911 and the Panamera. Intake sound amplifier to them, fake engine sound enhancement technique to you and me.

I cannot speak for anyone else. But two months on from that conversation, I am still reconciling “as genuine as the exhaust note” with the “sound symposer”.

How authentic or genuine is the latter?

Is it ok to use it because customers demand a quiet cruise and yet the primal pull of the sound we have all come to recognise as the Porsche engine?

Indeed my friend’s car doesn’t have this amplifier. When I am visiting him and am at home, that engine sound is how I know he is back. To that extent the signalling effect of the Porsche brand of cars does lie in its exhaust note.

Of course, I realise that the car itself is a manufactured artifact.

Given that, does sound enhancement detract from the authenticity of the engine roar?

Or should it be seen as just another way to make the customer happy by addressing his or her changed needs, and indeed, in case of hybrid cars, a way to address the critique that their quietness is potentially hazardous on the roads?

Signalling is often of the key functions a luxury brand serves. And brands know that.

“We are not selling watches to tell the time. We’re selling them to people who belong to a certain social class, who want to show off.” — Dominique Perrin, President, Cartier (in 1987)

Luxury brands also seek to deliver a wholesome sensual experience encompassing sound, sight, smell and touch. Porsche’s sound symposer, one could argue, just serves to enhance the audio experience and the signalling function of the brand.

Are existential questions such as this surplus to the conversation about brand building, or integral to it? What then is the source of a brand’s claim to authenticity?

 

Men in women’s fashion — the gender imbalance we don’t talk about

A few weeks ago, rumours abounded about Tom Ford possibly returning to Gucci, after Frida Giannini’s departure. While there is no doubting Mr Ford’s all-round creative nous, from couture to perfume and makeup, and film making, it would have been disappointing if he did return to the role. In the event, Ms Giannini was replaced by Alessandro Michele.

The technology industry isn’t the only gender-imbalanced industry in this world. Women’s fashion world redefines the imbalance between the customer base of women, who spend but where value appropriation is disproportionately made by men.

It is men, who overwhelmingly own stakes in, invest in, and lead companies that serve the women’s fashion market. For instance, Richemont, that owns Net-a-Porter, Chloé , Azzedine Alaïa, Van Cleef & Arpels and Cartier amongst others, fields, at the time of writing on March the 8th, 2015, a board consisting of 18 men and one woman! Doing better is Kering (formerly PPR) led by Francois-Henri Pinault with a board of 11 of which 4 are women. Kering owns, to varying degrees fashion brands such as Gucci, Saint Laurent Paris, Stella McCartney, Alexander McQueen, Bottega Veneta amongst others.

Men are also overwhelmingly the creative leads in many of women’s fashion brands. Here is a roll call for the uninitiated — Nicolas Ghesquière at LVMH, Karl Lagerfeld at Chanel and Fendi, Christopher Bailey at Burberry, Alexander Wang at Balenciaga, Hedi Slimane at St Laurent Paris, Jean-Paul Gaultier at the eponymous brand which is fair enough but he was at Hermès 2003-10, Rodolfo Paglialunga at Jil Sander, Alber Elbaz at Lanvin, John Anderson at Loewe, Olivier Rousteing at Balmain, and John Galliano having recently returned with Maison Margiela (he was earlier at Dior).

Which makes it worth celebrating Miuccia Prada at Prada, Donatella Versace at Versace (with Anthony Vaccarello at Versus), the incomparable Vivienne Westwood, Jenna Lyons at J Crew, and Hermès’s 2014 appointee Nadège Vanhee-Cybulski.

The magazines that serve women’s fashion market, Vogue and Harper’s Bazaar to name but two, are owned by corporations – Condé Nast and Hearst respectively – where almost all board directors and senior executives are male. Hearst has one female board director, Condé Nast‘s imbalance is tipped by the presence of Anna Wintour, the well-known industry heavyweight.

In fact only a minuscule 3% of creative directors in advertising, that drives women’s spend, are women. A staggering minority no matter how one looks at it!

I should however point out that mainly British women are in charge of some of the most influential fashion magazines including Glenda Bailey and Justine Picardie at the Harper’s Bazaar respectively in the USA and the UK, and Anna Wintour and Alexandra Shulman at the Vogue respectively in the USA and the UK. Thank goodness also for Vanessa Friedman, Suzy Menkes, Jo Ellison, Christina Binkley who witness, document and report on the fashion industry from the front row and beyond!

So why is it that when we talk of gender imbalance, we get stuck at the technology industry and Silicon Valley?

Why not start at the obvious — where women are spending money but where the value appropriation is overwhelmingly not made by women?

It’s not the pipeline for sure. A good 71% or more of the graduates of Central St Martins, the alma mater of late Alexander McQueen, and a reported 74% of the graduates of London College of Fashion are women. The number is 77% for women students at Parsons The New School for Design.

The industry is also traditionally not seen as no place for women.

But the industry does keep up with the tradition of notable wage gap between men and women, so much that there are no women in the top-20 highest paid executives.

So while we sit in the middle of Paris Fashion Week and mark another International Women’s Day, we ask yet again — what gives?

And more importantly, as we seek that elusive goal of gender equality — can we make it happen?

The theme for #IWD2015
The theme for #IWD2015

 

Unflattered by imitation

Luxury marques trade partly on the tangible benefits of craftsmanship, provenance and history, and partly on exclusivity (i.e. some can only aspire to them not afford them) and the brand name’s signalling value.

While discussing the face-off between the democratic web and the exclusive nature of luxury, in an earlier post, I wrote that the democracy-exclusivity divide may belong in a debate about sales targets but it certainly does not belong in a discussion about building a brand’s long-term value.

Luxury brands like to connect with the fans of their brands on social media but they draw the line at being flattered by imitation such as offered by counterfeit, fake or knockoff goods that some “fans” of the brand may purchase. There may be uncertain brand building gains but there is potentially certain revenue loss. While in most cases, it is expensive and time-consuming to go after sellers of counterfeit or knockoff goods, in other cases, such as the litigation LVMH brought against eBay, it is possible to make a concerted effort to suffocate the trade in fakes.

Museum_of_Counterfeit_Goods_Wikimedia_CC3.0Who buys these counterfeit or knockoff goods, with intent, anyway?

Some are bought by people, who aspire to but cannot afford the brand, yet nonetheless wish to signal their worth to others. In that sense, one could argue, that knockoffs do not really devalue the original brand. They serve a different market. They serve aspirers. These aspirers may or may not have real social influencer status, so their purchases may not matter either way.

A knowing few (hipsters?) often deliberately choose fakes. Someone I know socially, who can afford to buy the real thing, wears a fake Patek Phillipe Calatrava. It is a topic of gossip amongst those, who don’t know him well. On the other hand, a person, who knows Patek Phillipe craftsmanship well can tell immediately and won’t be impressed with his fake watch. His defence was, “I wear the fake ironically.” That makes it alright then.

Amongst those, who knowingly choose to buy fakes, some find social embarrassment mortifying. If you carry a fake Birkin, but move in circles where many have the real thing, that embarrassment will find you sooner than later.

Some others I know socially first bought counterfeit goods because of the aspiration value of the counterfeited brand, and because they coveted the brand’s beautifully made products. But then they found the quality satisfactory for their purposes and have continued buying those counterfeit products.

This is where it gets tricky for luxury brands.

How do luxury brands then stand out so that they can bring these people seeking quality into the fold or at the very least make the genuine article stand out so dramatically that the aspirers move away from fake goods altogether?

I see three flavours of a new kind of exclusivity emerging.

The first kind, that has been running for a few years now, is to make the brand aura accessible via collaboration with a high street brand, as Alexander Wang, Isabel Marant and others have done with fast fashion H&M. Such collaborations create a kind of desire and exclusivity within the mass market milieu, satisfying some aspirers while probably nudging others into exploring the real thing.

Then there is the use of technology to create and enable an inclusive form of exclusivity, such as Burberry enabling customers to buy off the catwalk and have goods personalised for a limited period after a fashion show.

But above all, luxury turns to its roots in craftsmanship, the exclusivity of custom-made novel fabrics and materials, such as practised by Mary Katrantzou, who is having a special kind of lace and embroidered jacquards specially made in Swiss mills. This is near-impossible to knock-off and the goods are certainly far from anything the mass market can access.

Luxury will always have an uncomfortable relationship with the democratising effect of the web and emergent technologies. In exclusivity lies its allure.

What will emerge is innovation in ways of keeping that exclusivity alive. And in ways of influencing the intent of fans and potential customers towards the real thing and away from fakes.

Craftsmanship is the reliable foundation luxury can always turn to.

But will that suffice?