brand loyalty programsfor luxury marketers

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Luxury Marketers: Is it Brand Lust or Brand Loyalty You're After?
Strategies to build brand lust differ markedly from those to build brand loyalty -- Luxury marketers need to know the difference

Stevens, PA September 17, 2007 -- Most luxury marketers will answer this question the same way: "We want it all -- brand lust and brand loyalty." But brand lust and brand loyalty are two entirely different things and marketers need to understand the differences, cautions Pam Danziger, president of Unity Marketing and author of Shopping: Why We Love It and How Retailers Can Create the Ultimate Customer Experience.

"Brand lust is a feeling or a desire to own a specific brand. As such it is not easily measured or quantified. On the other hand, brand loyalty is an action, a commitment made to the brand that transforms a potential target into a consumer. Loyalty is measurable and quantifiable," Danziger says. "Because the end result of lust and loyalty strategies are different, luxury marketers must develop branding strategies that target those differences."

She explains that strategies to build brand lust extend across a broad spectrum of consumers, recognizing that a marketer can build desire for a particular brand regardless of whether or not the target consumer fits the demographic profile of the brand's existing customers.

Strategies to Build Brand Lust Should Target a More Youthful Audience
"Marketers who aim to build brand lust are undertaking a long-term strategy to create a fantasy in the mind of consumers of what the brand represents and how the brand relates to their personal dreams and aspirations. On the other hand, a consumer has to be a 'player' to be the target of a loyalty program. Dreamers and aspirers need not apply. Brand loyalty is only relevant when talking about customers, people who have bought the brand and who are likely to buy the brand in the future," Danziger says.

So it makes sense for luxury marketers whose goal is to build brand lust to invest in advertising and other marketing communications that target a broad audience, especially a youth-skewing demographic that can be expected to achieve affluence in time. Danziger says, "The young affluents, or the young with potential to achieve affluence, as defined by education, profession and marital status, are the prime target for brand lust-driven advertising. Unity Marketing's research has found them to be far more brand aware and in tune to branding messages than the older affluents. (see Generations of Luxury Report) It is this passion to have and to own luxury brands that ultimately propels many consumers to buy, yet the real investment in such lust-driven marketing communications is to maintain the luxury image and allure, not necessarily to drive sales."

Brand Loyalty Programs Must Provide a Measurable Return-on-Investment
Brand loyalty, on the other hand, is far more tactical and can be measured in quantitative ways -- purchase recency, frequency and monetary value (RFM analysis). As result, luxury marketers must see a return on investment for their loyalty brand building efforts. That requires knowing exactly who your company's customers are, being able to measure and quantify their potential over the long term and having a means to reach out proactively to encourage them to buy and buy again.

"Luxury marketers tend to think loyalty arises organically out of lust, but that is not necessarily the case. A lust-driven customer may have their lust satisfied with that once-in-a-lifetime purchase, say a Gucci handbag or Chanel suit or by indulging in branded merchandise offered at a much lower price point, say buying a Burberry scarf or Versace sunglasses." Danziger says.

She continues, "A loyal customer, on the other hand, may not feel the immediacy of brand lust, so they express a more subtle, understated desire to experience the brand and the shopping experience again and again. Ultimately the loyal customer must be qualified by their purchase history and proven commitment to the brand. Thus they become members of a unique, highly selective club that not everyone can belong to. Being members of this exclusive club means they receive benefits and rewards that endorse the brand's unique image. These rewards also must in meaningful and measurable ways encourage the consumer to buy more often and spend more when they do."

"A one-size fits-all strategy doesn't work in the luxury market," Danziger underscores. "Rather the loyalty program for luxury marketers must be carefully crafted toward the unique values and ideals of the brand's customers. In-depth consumer insights need to be the foundation for program. It is through an intense understanding of the consumers that marketers will learn what really turns their customers on and what rewards will make a real difference to them."

For example, the most effective loyalty programs in the luxury market are not exclusively about earning points or money off. They offer more emotional benefits that make the loyalty member feel really special, like exclusive access to special events that are an experience for the loyal customer. Anybody can give a dollars-off coupon, and many do; but loyalty programs for the luxury market need to give these most highly valued and valuable customers a whole lot more."

To learn more about loyalty programs for luxury marketers, Pam has prepared a free white paper, entitled "Best Practices in Loyalty Programs for Luxury Marketers." It can be downloaded at http://www.unitymarketingonline.com/cms/Home/White_Papers.php

For more on marketing to the luxury consumer market, Unity Marketing has published the Luxury Report 2007: The Ultimate Guide to the Luxury Consumer Market. http://www.unitymarketingonline.com/cms_luxury/luxury/Luxury_Report_2007.php

More Insights on the Luxury Market
Unity Marketing's Luxury Report 2007 is the definitive study of the luxury consumers' buying and spending habits, written by Pam Danziger, the nation's leading expert on the 'new luxury' market and based upon the kind of in-depth consumer research for which Pam Danziger and Unity Marketing are known.

This report provides vital market size, growth and demographics for anyone and everyone that sells luxury, from marketers, advertisers, retailers, service providers. The Luxury Report 2007 is the ultimate guide to today's luxury market. It is an essential tool to understand the dynamics of the luxury market, today and into the future.

Special Offer: Unity Marketing's Luxury Report 2007 and Generations of Luxury studies are available at a special price. Subscribe to The Luxury Report 2007 and get the Generations of Luxury report for more than half-off the published price -- Get both reports for $5,000. Visit http://www.unitymarketingonline.com/cms_luxury/luxury/Luxury_Report_2007.php to order both reports.

For Media: Charts, tables and graphs are available upon request.

About Pam Danziger and Unity Marketing
Pamela N. Danziger is an internationally recognized expert specializing in consumer insights, especially for marketers and retailers that sell luxury goods and experiences to the masses or the 'classes.' She is president of Unity Marketing, a marketing consulting firm she founded in 1992.

Advising such clients as PPR, Diageo, GM, Stearns & Foster, Waterford/Wedgwood, Lenox, Prudential Fine Homes, Ritz Carlton, Orient-Express Hotels, The World Gold Council, The Conference Board and American Express, Danziger taps consumer psychology to help clients navigate and master the changing luxury consumer marketplace.

In recognition of her ground-breaking work in the luxury consumer market, Pam received the Global Luxury Award presented by Harper's Bazaar for top luxury industry achievers in 2007.

Her latest book is Shopping: Why We Love It and How Retailers Can Create the Ultimate Customer Experience, published by Kaplan Publishing in October 2006. Her other books include Let Them Eat Cake: Marketing Luxury to the Masses�as well as the Classes, (Dearborn Trade Publishing, $27, hardcover) and Why People Buy Things They Don't Need: Understanding and Predicting Consumer Behavior (Chicago: Dearborn Trade Publishing, 2004).

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