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Luxury fashion web-shops

A successful distribution channel?

Written by J. Erdtman, C. Hedinge

Paper category

Master Thesis

Subject

Business Administration>Marketing & Sales

Year

2010

Abstract

Thesis: Factors of luxury brands Kapferer & Bastien (2009) summarized some management recommendations for dealing with luxury brands. They call them anti-marketing laws specific to luxury goods because these laws often contradict traditional marketing advice. One of the laws stipulates that consumers should find it difficult to purchase the brand's products. According to them, luxury goods must be earned, and the harder they are to obtain, the greater the desire. Luxury goods have a built-in time factor, including time spent searching, waiting, and so on. This is in contrast to traditional marketing, which claims that it can be accessed quickly and easily through mass distribution and the Internet. For luxury goods, in order to increase the desire of consumers, there should be a certain degree of difficulty. These difficulties may involve financial, logistics and time issues (Kapferer & Bastien, 2009, pp. 61-62, 67). 2.3 Brand integrity and brand dilution For luxury fashion brands, consumers pay more for brand-name products than those Identical products that lack brand identity (Kort et al., 2005). In the luxury fashion industry, the functionality of products is far less important than the brands of these products, because style and exclusivity lie in the brand. In other words, this means that if a brand like Dior has very expensive products, then Dior consumers will definitely buy these products to show others their wealth. Today, all luxury fashion brands face the problem of maintaining brand integrity, such as being able to create an indefinable atmosphere and persuade consumers to pay a lot of money for cheaper products they could have bought elsewhere (but no brand or copy ). The opposite of brand integrity is called branding. According to Kort et al., dilution occurs when luxury brands become too popular. (2005). What happens in this situation is that too many consumers are interested in a certain brand’s products and start to consume their products in large quantities, which means that specific products subsequently lose their exclusivity because of the It is no longer a minority, so consumers no longer think that the product is good value for money, and this also reduces the brand's status. There are some ways for luxury brands to avoid dilution; one way is to minimize the sale of online products, because when selling online, a variety of consumers in many different regions of the world can use these products. Another method is to keep the price high, and sometimes even increase the price, so that the general visit volume becomes smaller, thereby improving the brand. 2.4 Distribution of luxury fashion products/brands Kapferer & Bastien (2009) quoted a proverb, “When you don’t see it in the store, you can’t say you have a distribution there” (Luxury strategy: break marketing rules, establish Luxury brands, p. 198). Distribution is an important part of brand communication. Stores are a place to show consumers the history of the brand, as well as a place to set desires and enhance consumers' desires from a distance. A store is a place where products are displayed, so they must be displayed in the best way, and they must also be displayed in a suitable environment. This is the scene where the brand displays its classification. The spread of luxury brands has never been directly concerned with price. The price level should be communicated through the store image and interior decoration and the exact price of the sales staff. At the beginning of luxury goods, it was only offered to the elite, so rarity was one of its cornerstones. If luxury goods are always available to everyone, it will be democratized, it will lose this factor and become common, and the only thing that distinguishes luxury goods from other products is price. In order to prevent this from happening, Kapferer & Bastien (2009) believes that rarity should be maintained at all levels through the following points: few selling points, specific locations, excellent sales staff, shops for display, and products for product display (Kapferer & Bastien, 2009, pp.198-199,203). 2.4.1 Distribution system Kapferer & Bastien (2009) means that any distribution system is more or less suitable for luxury goods. Private label stores are the easiest way for brands to showcase themselves and their products in the way they like. They have complete control over products, prices and store image. From a financial point of view, it is also better to own your own store; they get higher profits than when they use an intermediary. Another important factor is the brand’s own sales staff, who are part of the brand and represent the brand for consumers. This system is the only system that completely protects consumers from counterfeiting. On the other hand, this system is very inflexible, requiring the products to be sold in a certain quantity and speed in order for the store to make a profit. Another system is called exclusive distribution. This type of agreement should specify the location, personnel, and personnel. The transparency of consumers and the conditions that are resolved for them. If this is the case, can the brand still maintain a personal relationship with its consumers? According to Kapferer & Bastien (2009), the system is more flexible and does not require the same sales because store costs are shared with other brands. Read Less