In today’s evolving consumer centric environment and burgeoning competitive market, it is imperative for marketers to adopt a highly customised communication strategy where the channel/medium is determined basis the product and its demand.
To swim through the tide and reach the other side, it is necessary for retailers, in fact for any industry to adopt a customized marketing channel strategy specifically for both luxury and mass products. The marketing for both the segments are like parallel streams originating from the same river, as they are different in terms of their brand identity, positioning, attributes, target market and brand building process.
On one hand, luxury products are more about the gigantic aura and the brand universe associated with it. They are like life style codes, and are considered to be aspirational for the masses. The marketing strategy for luxury products needs to be highly customised/ personalised as per the individual so that sense of brand universe is paramount.
On the other hand, mass consumer products are manufactured with the purpose of selling huge quantity, hence they have all the basic concepts of marketing involved so that the reach is greater.
Some of the ‘key approaches to be mindful’ while marketing mass vs. luxury products are:
Identify the right target audience – The first and the foremost difference which one should be mindful while marketing mass and luxury products, is in terms of branding it as per the target audience. With mass consumer products, the target audience tends to be larger and the goods can be easily marketed through a larger array of channels, such as radio, televisions, promo mix, billboards etc. With luxury products, the approach has to be molded, as exclusivity plays a pivotal role when establishing the target market of consumers. Instead of targeting a broad group of buyers, luxury products should be marketed to a narrow percentage of individuals that can actually afford the product. A key strategies for marketing luxury products is through exclusive channels such as tailored product catalogues, airline magazines, exclusive product launches, exclusive outlets, etc.
One size doesn't fit all - A retailer must be conscious to determine how to successfully acquire, engage, attract, sell to, and retain the diverse and demanding luxury product customers. They often tend to respond poorly to conventional strategies and products. Hence, retailers should continuously mine customer data and deploy predictive analytics to determine what would be the next best product or what would be the most optimal communication strategy. This can make a huge difference in attracting and retaining luxury buyers as the product or the offer being given is always customized to suite their demand
Price it right - No matter what the item or the cost, price is an important defining factor as far as a product segment is concerned. With mass consumer products, a lower price is kept in consideration while higher price tags are acceptable with added features and benefits in case of luxury products. However, with luxury products, price can have a different meaning, as it generally acts as litmus that adds a degree of exclusivity to the product, or limits the access. A high price tag on a luxury item is seen as positive instead of a potential harm. Analytics can play a critical role to determine the right price for the product basis the target market. Many retailers today heavily depend on pricing techniques like price pack architecture analysis to determine the right price for the right size
Multi-channel vs. Single-channel distribution – A marketer must always remember that a luxury customer is willing to pay a hefty price only as long as he is getting a product which not only stands out among the flock of other products but also has exclusivity in terms of access. In case of mass products, a variety of channels can be used simultaneously: corporate stores, independent retailers, online, catalog, etc. on the other hand, the distribution of luxury products should be done through highly selective, and almost exclusive channels of distribution such as exclusive corporate stores, through personalized selling, etc.
In a nut shell, luxury products can be marketed more based on services/customization, convenience rather than the product itself while for mass products the marketer needs to focus more on selling larger quantity which is only possible though multi-channel distribution, better pricing, attractive offers and through larger channels of communication.
This article has been authored by Suhale Kapoor, Co-founder and Executive Vice-President, Absolutdata Analtyics.