Waiting to be served!

There are millions of products available for customers nowadays depending on what they are looking for. Product can be classified into physical good, service, retail store, person, organization, place or even idea (Keller, 2003)

What is service?
Services are economic activities offered by one party to another, most commonly employing time based performance to bring about desired results in recipients themselves or in objects or other assets for which purchasers have responsibility

Service is considering a big player in the market these days especially in luxury business. Customers are looking for excellent, beyond-expectation service to serve their unfulfilled needs. There are different levels of service involved in different business categories.

There are four main characteristics of a service
1.) Lack of ownership: service cannot be owned or stored for later usage like products. It is used for only a specified period of time.

2.) Intangability: service is intangible and cannot be held or touched like a substance. However, the experience customers get from that service is measurable and do affect brand perception and feeling towards the brand

3.) Inseperability: service cannot be seperated from the brand itself or service providers. It is produced only at the point of purchase.

4.) Perishibility: service lasts for a specific time and cannot be stored for later use. It is produced and used almost simultaneously

With its unique characteristics and nature, services need the extended elements of the marketing mix (8 P's)

• Product elements
• Place and time
• Price and other outlays
• Promotion and education
• Physical environment
• Processes (systems used to assist the organization in delivering the service)
• People
• Productivity and quality

After the lecture, we all were assigned to think about any service and elaborate on its element of 8 P's. Our group chose to work on Movida which is one of the popular luxury clubs in london.

We believed that for luxury clubbing business, product elements are the most important thing to consider in the marketing mix. Due to its highly competitive market, each club needs to differentiate itself by what it is prominently offering to clients; quality alocohol products and great music, followed by place and time, physical environment, productivity and quality, price, people, process, and promotion respectively.  

Lastly, because of the intangibility factor that mainly affecting the way customers form their evaluation towards the service, there are 10 recommendations for improving service quality (Keller, 2003)

1. Listening: understanding what customers are looking for and expecting from the service

2. Reliability: most important dimension of service quality

3. Basic service: deliver what you are supposed to do and keep your promises

4. Service design: develop a holistic view of the service

5. Recovery: encourage customers to complain and respond promptly

6. Surprising customers: offer beyond expectation services

7. Fair play: always be fair

8. Teamwork: maintain employees' motivation and capabilities for standardized services

9. Employee research: do research with employees to see what the problems are and solve them

10. Servant leadership: inspired leadership throughout the company and excellent corporate culture

Remember, customer is still always right!

Bibliography
1. Keller, K. (2003). Building, Measuring, and Managing Brand Equity USA.: Pearson Education.

FERRARI: Not just a car anymore!!!

What comes to your mind when talking about Ferrari? Definitely, for most people, it would be about luxury Italian sports car. Ferrari is a world-renowned brand founded in 1929, with its prestige and high reputation in premium quality, craftsmanship, its distinctive red colour, speed, affluence, glamour and so on.

Ferrari, although known for its sports car, is not only about automotive because it has wide product ranges in hand as well, including, menswear, ladieswear, accessories (shoes, sunglasses, caps,ties, belts, gloves, umbrellas etc.), leather goods, home & bath accessories, office items, electronic & hi-tech gadgets, mobile phones, fragrances, watches, sport equipment (ski, bike, skateboard, surf etc.), collectible items, toy models, kids range and many more. It was very surprising for me when I looked at its online store because I didn't even know some of those product lines existed.

So, here comes the brilliant idea for my project!!!

This is my current perception towards Ferrari brand (and I think for almost everyone else as well)

To begin with, I think everyone thinks about its distinctive red colour when it comes to Ferrari with its shiny flashy and coolest sports car. For a person, it would surely be Enzo Ferrari, the founder and the face of the company with his great vision and success. The house Ferrari would live in is Casa Ferrari in Maranello, Italy's secret capital as a hometown for Ferrari. For the drink, Ferrari would enjoy drinking double dirty dry martini, giving a little bit of sophisticated, bad boy image women always fall for. And most of all, Ferrari is doubtlessly about power, speed and racing as it is strongly related to Formula 1 racing.

As it is obvious that Ferrari is such a strong and established brand in the market, I chose to do brand extension, as in a case of well-known brand extending to unfamiliar market for my project. It is a wisely strategic way to leverage a brand with extension, using its fame and reputation to enter and create advantage in another product category (Aaker, 1996).

Aaker (1996) also suggested that for the brand that is currently operating very well, extension will be the best option because of its existing brand's associations, perceived quality, and prominent awareness. The rationales behind are that it would be an exploitation of the firm's current assets applying to new market and new product line, and also reduction of cost and risk of entering new business.

Therefore, I propose "S.F. energy drink by Ferrari", world's first luxury energy drink ever!!!

I believe it would be a great move for Ferrari to extend its line into something new and exciting. The market for energy drink is still quite small compared to other markets, especially for luxury one which I could think of none. It will help attracting new customers because the barrier of entry price is decreased and that offers a chance to be a part of Ferrari brand for those who cannot afford other product lines which are more expensive. Its brand image will be more hip, energetic and sensational, engaging more with x-treme sports but still playing around the concept of power and speed.

For Ferrari's brand image after brand extension, the colour will still be red but in a wildly agitated way. The person will be Fernando Alonso, one of the most famous F1 drivers by Ferrari, who represents cool athletic image with great success. The place would be Rome's Lottomatica arena which ties in very well with the concept of energy drink and sports. The car that S.F. would drive in is definitely Ferrari. For the drink, it must be energy drink, in which the concept design of logo, branding and packaging will be revealed later on.

I hope this sounds exciting in a way and stay tuned for more!

Bibliography

1. Aaker, D. (1996). Building Strong Brands London: Simon & Schuster UK.
  

Are you my soulmate?

How to create a brand especially luxury one? It is simple yet very difficult question to answer. Building luxury brand needs special practice as it doesn't fall on normal marketing strategies. The first thing you need to have is differentiation and uniqueness of the brand. In Endorsement & Sponsorship class, we talked about characteristics that define luxury brand. Well, any luxury brand must have exclusivity, quality, craftsmanship, high price, selective distribution, high-end promotion and advertising and so on. However, emotional attachment is inevitable criteria as well because people consume luxury products not only for its tangible aspects, but also for the emotion it will bring. Luxury brand sells the dream along with high quality product. Living the dream is what consumers nowadays are looking for.

Brand identity is another important point. In order to become successful luxury brand, it must have distinctive brand identity, what it essentially is and where it stands, in which brand needs to position itself clearly and deliver it consistently to customers. One key to successful brand building is to understand how to develop a brand identity, to know what the brand stands for and to effectively express that identity (Aaker, 1996).

I found an interesting concept for building luxury brand by Philippe Mihailovich, professor of luxury brand management in France, that I want to share. Basically, he said that building a brand on storytelling is not working anymore. Luxury brand cannot be built from only one story or else it would be like building a prominence of an artist based on one piece of art. Luxury brand is all about the artist himself, his beliefs and values, techniques, materials used, and emotional touch-points. To build luxury brand name is like human relationships. It needs to create personal emotional bonding with its customers or to become their soulmate!!

Mihailovich (2009) suggested 12 steps to build luxury brand as if building a love story, to obtain long lasting relationships between customers and the brand.

Step 1: You're gorgeous                                      >> The rules of immediate attraction
Step 2: Getting interested                                     >> Showing and declaring receptiveness
Step 3: Getting to know you                                >> Where you are from / Where you live
Step 4: Who's in your past?                                 >> Your history / How you got here
Step 5: Meet the family and friends                      >> Liking those closet to you
Step 6: Are we right for each other?                    >> Let the head has its say
Step 7: Can I trust you?                                      >> I need to rely on you
Step 8: I want you                                              >> Consuming passions
Step 9: Soulmates                                              >> We share many values
Step 10: I love your touch                                  >> A personal touch throughout
Step 11: I love you                                             >> I'm commited happily and totally engaged
Step 12: Happily ever after                                 >> Constant desire / Lasting memories

These steps portrait the journey of the brand through time from the very beginning of introduction to the point of becoming favorite brand in consumers' mind, in comparison to having a relationship with someone right from getting to know, gaining trust, and loving wholeheartedly.

In class, we all had a group task to create one luxury brand and present the mood board to class. Our group came up with a private jet service for celebrities and sports personalities called 'Jetsetter'.

From the mood board above, it showed core brand identity and brand personalities, along with emotive qualities it brings to customers very clearly and deliberately. Jetsetter plays around the word 'deluxe, quintessentially & prestigious'. Its corporate colours are black and silver which simplify the luxury and classy image. It embeds the emotinal qualities of being exquisite, stylish, exclusive, comforable, classy and private to satisfy the need of those who appreciate a discreet yet luxury service.

Another group came up with a new, expensive champagne targeting at younger audience. It plays with the purple colour because purple represents joy, fun, and cheerful to attract young generation. Purple as corporate colour helps differentiate itself from other competitors because people normally think about black and gold when it comes to champagne. It relates itself to Christian Louboutin shoes as being seductively sexy and use Mary-Kate Olsen as celebrity endorsers. They are perfectly matched as a face of the brand and can engage younger crowds to consume this champagne brand in an attempt to be like the Olsen.

Another example is boutique hotel for wealthy singles called 'The V'. The hotel has exclusively 42 rooms and has partnership with Vertu, offering VIP concierge service to guests. It features all Philippe Starck design, has famous japanese restaurant, luxury spa, fitness, cinema, members only club. It emphasizes excitement, freedom, romance, passion, exclusivity, and glamour. The V offers everything you want to serve your luxurious desire at any time.

Now, it's time for you to consider creating one luxury brand on your own! It's not as difficult as it sounds!





Bibliography
1. Aaker, D. (1996). Building Strong Brands London: Simon & Schuster UK.
2. Mihailovich, P. (2009). Haute Luxe: Building Your Luxury Brand Love Story. Available at: http://luxurysociety.com/articles/2009/11/haute-luxetm-building-your-luxury-brand-love-story (accessed 26 February 2011)

"The Perfume Diaries"

Inspired by the lesson about packaging few week ago, in which we discussed in class about perfume industry and how it has evolved through time, it made me think about 'The Perfume Diaries' exhibition I went to at Harrods around 5 months ago and I wanted to share to those who missed it.

I heard about it when I first arrived in London and I, as one of the perfume lovers, was really looking forward to it.  'The Perfume Diaries' was curated by world-renowned fragrance authority Roja Dove, Professeur de Parfums and the author of The Essence of Perfume, whom we all had a chance to meet in person when he came as a guest speaker at Regent's College. The exhibition portraited the fascinating chronicle of perfume from ancient era to present time. It showed the evolution of perfume decade by decade and walked through the history behind it. I was enchanting by it!

Francois Coty, French perfume manufacturer once said,

"A perfume needs to attract the eyes as well as the nose."

Perfume is one of the things that packaging plays crucial role in it. Not only the scent has to be adorable, but also the flacon needs to be captivating as well. Packaging in perfume industry has evolved through time until the point that sometimes the bottle itself costs more than what is inside.

The exhibition began with how perfume was produced in an ancient time. It showed how ancient perfumes look like, how to manufacture it, showing all the tools and perfume handbooks in the old days, which were rare things to find nowadays.

Roja Dove himself has selected fragrances from all over the world, featuring all important brands in the industry, which made an impact on perfumery and influenced the society, people and the way in which we wear perfume nowadays. Also, original artwork, sketch designs, vintage advertising visuals, fashion costumes were displayed along with rare flacons up to modern perfumes these days.

Moreover, the exhibition played on the way in which perfumers were influenced by the society and more importantly, how fashion and trends have always inspired the scent and packaging design of perfumes. It is obvious when you look at the history and trends of fashion at that specific time, there is always a linkage between fashion and bottle shapes. Many fashion brands have its own perfume line to enrish its clothes and fashion accessories. Christian Dior said,

"This is why I became a perfumer, so that all my dresses would appear simply by opening a bottle."

I suddenly love this perfume 'Attimo' by Salvatore Ferragamo, not by its scent actually but by its design and story behind. Attimo was inspired by historical multi-coloured round shaped wedge shoes made for Judy Garland in 1938 specifically. This is a good example of how fashion plays important role in perfume industry and packaging design as well.

Another great example is 'Vivara' by Emilio Pucci. Mr.Emilio Pucci, famous Italian designer, is always known for his unique designs around prints and colours in fashion industry. However, in 1966, he decided to extend its line to perfume as well and launched the notable perfume, Vivara, which embodied the iconic Pucci print named Vivara into it.

I have to admit sometimes I choose a perfume firstly by its flacon which attracts my eyes right from the very beginning. Then, the matter of scent and smell come after! What about you?

Source: The Perfume Diaries exhibition at Harrods, 28 Aug - 2 Oct 2010

"DNA"

What is DNA?

DNA stands for Deoxyribonucleic Acid which is molecule in living cells that contains genetic instructions used in the development and functioning of things (BiotechnologyOnline, 2010). To explain it more easily, it is a set of blueprints that contain all genetic information of that particular thing (Wikipedia, 2011). I'm not going into scientific mode here but I just want to set a ground rule of what DNA is.

So, it is clear now that everything in this world comprises of DNA which represents the overall of characteristics of that thing, including living organisms like human and animal or even objects.

Every brand in the market must has its own strong brand's DNA which illustrates the whole image and characters of the brand. Therefore, what is brand 's DNA exactly?

Brand's DNA is the list or genetics of a brand ranging from colour to photography, materials, form, placement, people, price, attitude, endorsement etc. It includes both visual and sensory code that people use to relate to one particular brand. In order to differentiate itself from its competitors, brand needs to have strong and consistent brand image in consumers' mind and this is really crucial in luxury brands.

Carol Chapman (2010) made an important statement, in which I totally agree upon, that brand needs to have effective marketing strategies in an attempt to attract customers in the door. However, it doesn't bring them back to the same brand for the second time or later on as frequent or loyalty customers. The important thing here is that brand needs to make sure that customers will come back for more with its ability to always deliver consistent, distinctive, and relevant experience to its customers.

Chapman (2010) also gave 8 useful benchmarks you need to consider to make sure you have precise and distinctive brand's DNA;
1.) What perception does your  brand want to own in the minds of your market?
2.) What is the distinctive style of your brand?
3.) What are the core values of your brand that guide your behaviors and business practices?
4.) What are your unique differentiators that help create and leverage brand advantage?
5.) What standards of performance excellence will you adhere to across your brand scorecard?
6.) How will your brand reinforce who you are and the desired perception you want to create in the minds of your employees and customers?
7.) Does your brand have strong point of view?
8.) What is your brand promise to your employees and customers?


Now, what are the intrinsic qualities that make up a brand?

• Name - Luxury brands have their own ways to do things. Starting from the name, it usually doesn't follow branding strategy of how to come up with a brand name. Normally, luxury brands tend to use the name of its creator

• Emotive
• Celebrity Endorsed or Anonymous - Luxury brands tend to use celebrity endorsement as one of the essential tactics to attract customers and create desire to own the product

• Senses - It includes both tangible and intangible things; shape, colour, smell, sound, icon, touch, service etc.

• Visual Code - It can also be called 'logo' and it provides immediate recognise of the brand in split seconds

• Style/Photography

• Experience

Last but not least, packaging is one of the things luxury brand couldn't forget. Nowadays, people not only buy for the product inside, they also buy the packaging. To have congruent image in consumers' mind, brand needs to pay attention to every little detail comprising the brand. Packaging is one of the first representations of the brand itself, creating excitement for what's inside, and it now conveys the concept of 'more' than just a product. It brings the living dream to people. Packaging for luxury brands normally uses good quality material with durability, elegance and classic design to deliver perfection to its customers, for example, Krug offers 'Krug On My Own Terms', luxurious bespoke cellar case with personalized plaque made from either metal, mirror, or saddle leather along with customer's name or initials. This Krug special case costs around $1,000 (Stern, 2008).

So ... are you a type of person who might judge a book by its cover? If yes, don't be surprised! That's how it works!





Bibliography
1. Chapman, C. (2010). 'What is your brand DNA? Create a more desirable brand experience' Sales & Service Excellence, 10 (1) pp.5. Business Source Complete [online]. Available at:

http://web.ebscohost.com/ehost/detail?hid=107&sid=70bdd427-928b-4eca-936d-4890b2b15b65%40sessionmgr114&vid=3&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bth&AN=48723850 (Accessed 24 February 2011).

2. Biotechnology Online (2010). What is DNA?. Available at: http://www.biotechnologyonline.gov.au/biotec/whatisdna.html  (Accessed 24 February 2011)

3. Wikipedia (2011). DNA. Available at: http://en.wikipedia.org/wiki/DNA (Accessed 24 February 2011)

4. Stern, P.J. (2008). Krug 'On My Own Terms'. Available at: http://www.luxist.com/2008/12/03/krug-on-my-own-terms/ (Accessed 24 February 2011) 

The Appetiser

Guilty Pleasure (noun)

: something pleasurable that induces a usually minor feeling of guilt

Everyone must have their own guilty pleasures one way or another; either fashion, clothes, shoes, bags, cars, gadgets, or even foods. Luxury products definitely fits into this category perfectly. Luxury, the excesses of life, is not what one needs, but what one wants. So, what is luxury exactly? Well, it depends on who you ask. Luxury can be exclusive, expensive, extraordinary, special materials, high-end packaging, personal experience, scarcity, private, classic, unique, in the know, prestigious, instantly recognisable and so on. However, money is not the only issue here; you have to know how to spend it rather than simply having spending power. It is considered a personal preference for any individual and a matter of taste. Coco Chanel once said,

"Luxury lies not in richness and ornateness but in the absence of vulgarity"

Luxury doesn't always mean big logos of brand name out front ...

Discreetness of luxury is a new trend nowadays ...

How do these brands typically communicate to the world? They can communicate through experiences; fashion shows, private events, stores, online.

They can communicate through forms; fine materials, hand-crafted, beautiful package, craftsmanship.

Or they can communicate through essence.

One way or another, design is critical to all the touchpoints of a luxury brand in which it has to manage its consistency throughout, one of the most important things to keep in mind all the time!




PS. I'm just a simple girl with my own views to the world. I have to say this is my first blog ever and I'm doing this as a part of my studying for Managing Luxury Brand subject, Luxury Brand Management course here in London. I'll keep posting stuff from my class and also what I think it is interesting through my course of life. Hope it will be useful for just anybody, no matter who you are and where you are in this whole wide world ...