7 Paths Of Highly Successful Luxury Brands

The luxury space is limited and brands looking to occupy this space need to find appropriate routes to communicate luxury and move up the value perception.

From the analysis of luxury brands across 24 countries, the Rediffusion-Y&R Brand Asset Valuator® (BAV),  identifies seven distinct paths to communicate luxury.

The first route is based on the cues of originality, quality, distinctiveness, and charm. We call this route as Fabled Reputation. Brands like Ferrari and Rolex are typical of this route; they define the category based on their reputation. Ferrari stands apart as distinctive and original in the sports cars category basis its reputation built over decades.

The second route is to communicate Exquisite Functionality. Brands like BMW and Armani are archetypal of this form of communication. They enjoy the perception of performance, leadership, and intelligence, as you would experience while driving a BMW with all its exquisite details taken care with perfection. These brands are also seen as highly trusted and reliable. 

Luxury can also be perceived as having good value by communicating authenticity and simplicity. Brand adopting this route are typically traditional, straightforward, down to earth, and helpful. This is the path of Small Indulgences adopted by brands such as DeBeers with its simple and straightforward message positioning to celebrate life during special occasions.

The fourth route to luxury is by being posh. Think of Yves Saint Laurent which targets upper class affluent individual. Brands using this route are perceived as upper class, prestigious, glamorous, and stylish. The route involves using attributes of arrogance and unapproachable to their advantage to build a niche audience of customers. So, service-oriented brands should be careful if they want to walk the path of being posh to communicate luxury.

The fifth is the Avant-Garde route, wherein brands communicate luxury through cues of innovation, progressiveness, modernity, trendiness, and popularity. Lexus’ constant focus on innovation, latest technology and design evolution classifies them as Avant-Garde in the world of premium cars.

Sometimes, luxury brands appeal to the aspirational lifestyle of consumers, such as the desire to be bold, daring, or exhilarating. We call this the route of Lux-hilaration. Brands adopting this route send out cues of being energetic, dynamic, rugged, independent, and fun. Fashion brands such as Prada and Versace define fashion trends using this route.

Finally, many brands, particularly in the service and hospitality sector, communicate Delightful Service. Taj Group of Hotels and the Oberoi Hotels have adopted the route to luxury to communicate friendliness, superior service, kindness, care, and attention to detail, providing best in class service and patronage to their guests.

Each of these seven paths to building luxury identified by the BAV has a different influence on brand equity and perception. Depending on the category and on other competing brands, each of these routes can have a high-cost of entry or can be a relatively underleveraged route. For instance, adopting the Posh route may be more challenging because the attributes are very strongly associated with the respective brands. In contrast, the Small Indulgences route is relatively underleveraged with potential for white space. Nevertheless, brands can adopt one or multiple paths of communication in their quest to build luxury. The key is to be clear on which route is most suited to the brand personality and the category cues, so that the communication is consistent and effective.