Ever wonder how elite brands get the public to heart them? You know the big name brands that everybody want and willing to wait even a year for products to be delivered. There is an art that high-end brands achieve to become the elite of the elite. So why are some luxury brands just average and others are amazing?
When it comes to elite luxury brands some believe that there is a difference.
Brands are sorting devices. They help consumers make decisions based on tangible and intangible attributes, benefits, and associations. One commercial segment has leveraged the benefits of branding admirably. Luxury goods and services have long recognized that investing in branding is good business. However, luxury brands have become their own worst enemy paving the way for a new category of branding. These are what I call Elite brands.
Elite brands control supply differentiating them from the vast majority of current luxury brands. The latter have pursued a strategy of ubiquity eroding their prime differentiator of exclusivity. Coach purses, BMWs, spa days, and many more examples, are now within reach of the many. These brands and activities used to be the purview of smaller, more affluent consumers. But in the last ten to fifteen years, brands have dropped prices, lowered quality, expanded distribution, and deliberately retooled to offer entry-level versions of their once exclusive offers. In an attempt to grow the top-line these brands have removed their mystique and allure. They may have grown volume but they have also impacted margin and image.
This prompts a series of questions. If more consumers than ever before can have a Mercedes-Benz does it make less attractive? How do longstanding attributes, benefits, and associations of luxury brands morph over time when they are available and affordable? What is lost in brand value when the price and quality equation is sacrificed for short-term sales?
Ponder Apple who has long enjoyed an underdog or challenger brand position. But success and size soon made this unsustainable. Brilliantly reflecting their innovator culture, Apple is mass market but also elitist. Its products are targeted to creative thinkers and doers rather than office and suburban drones. And arguably (perhaps ironically), Steve Jobs would weep if Apple products were everywhere.
In Apple’s culture, bigger is not better and this extends to the adoption of their wares. Apple knows that omnipresence is not the goal. The fact that consumers cannot get the iPad2 when they want communicates an elitist position that benefits Apple long-term.
Most histories claim that economics is the central organizing principle of most societies and the corollary is not everyone can have everything – on this Marx, Keynes & Galbraith would agree. The very aspiration of ownership is as valuable to an Elite brand as is an actual sale. As Christopher Morley said, “There are three ingredients in the good life: learning, earning and yearning.”