Written by: Ivaylo Moskov Ivanov

Introduction

Nowadays Internet is an interactive place, where people are not only passive observers any longer, but also active participants and even content co-creators, characterized by communicative cooperation. Social media has become a global powerful phenomenon, which has increased the degree of social online activities among many consumer segments. After it has been neglected from the luxury brands for a long time, they have now considered what communication force they can achieve by implementing more active online presence. One of the reasons for which luxury brands have been so reluctant to adopt social media strategies so far is that they are trying to balance their exclusive appeal with the social masses. Social media for the luxury brands has been seen as more negative as it can reduce the brand value and perception and even make the brand more accessible. (Wright, M., 2009)

Purpose

The purpose of this e-paper is to understand how luxury brands can exist in social media without compromising their luxury appeal and values, and even to exploit the traffic and interaction that social media generates in order to enhance the brand and achieve growth. In support to the theories provided, the company Burberry is used as an example.

Theoretical framework

Introduction of luxury consumption

Values have an important role when creating identity and group belonging. (Roper & Fill, 2012) The increasing globalization and the development of the online social media has given the consumers the opportunity to represent themselves to a larger group of people. By following and endorsing luxury brands, these consumers can position themselves by belonging to certain groups. According Heine (2012) luxury brands can be defined and regarded as images in the mind of consumers that comprise associations about a high level of price, quality, aesthetics, rarity, extraordinariness and a high degree of non-functional association. The products offered by the luxury brands require a relatively high degree for all of these characteristics.

Since the 1980s, the luxury market has grown at about ten percent per year, a much higher rate than the world economy, making the luxury industry a relevant economic factor (McKinsey, 2011 in Heine, K. 2012). Veblen describes the consumption display of luxurious goods as a conspicuous consumption and waste, which highlight the inferiority of the upper class. According to him being wealthy is not enough to create distinction between classes. In order to acquire social power, the wealth that the upper class posses has to be show off in public environment through a selective process of differentiation by using expensive items and services. (Corrigan, 1997) Since ever then, the luxury items have been acknowledged as an evidence of higher social status, and instruments that make you express yourself with high focus on pleasure. The paradox with the consumption of luxury brands in comparison with the mass-market brands is that an increase in the luxury brand awareness does not necessarily lead to growth, but rather to decreasing demand (Heine, 2012).

Why social media platforms should be adopted by the luxury brands?

Today, the most promising communication environment for reaching and interacting with stakeholders is the social media ecosystem (Hanna, Rohm & Crittenden, 2011 in Vernuccio, 2000). The social media has grown so rapidly in the past years that now impact the business processes and models (Hennig-Thurau et al. 2010). Vernuccio focus on research, which determines how corporate brands communicate throughout the Internet and have identified four types of users. Luxury brands can be seen as “selective strategists” due to the fact they use social media selectively in order to position their strategy with strong focus on emotional message appeals. The content they develop is primary for selective users and often ignoring the other potential masses.

Kapferer states that Facebook is one of the most excellent strategies of managing fan communities (Kapferer, & Bastian, 2012). By following certain luxury brands on Facebook, users show both their identity and belonging to sophisticated group of people. Facebook also can be used as favorable brand extension tool to communicate the online luxury brands identity. Christodoulides (2009) argues that the loss of control through the online applications is so extensive and the consumers may even interfere with the brand’s values. However one of the biggest advantages of using Facebook is that you have the option to control the messages and the content creation of the users.

Burberry is on of the best examples of luxury retailer that has recognized the power and influence of social media and adopted it to their strategy. The company has fully embraced social media in order to reach customers and fans and over 60% of their marketing budget is now dedicated to the digital (Deering, S.). At present, their Facebook page has hit more than 17 million followers (facebook.com/Burberry). Though Facebook constitutes its largest audience, but the brand also engages consumers on Google+, Twitter, Tumblr, Pinterest, Instagram and YouTube (Doran, 2014).

The company is a pioneer in incorporating technologies in the fashion industry and creates unforgettable online experience by also designing own private platforms, exclusively for their most affluent customers. This has resulted in initiatives such as “Art of the Trench” (artofthetrench.burberry.com), where these loyal customers are encouraged to upload pictures of themselves wearing a Burberry trench coat. The campaign is designed as an independent platform, which gives the brand the power of fully control over the content. By launching own brand community website, Burberry distinguishes their loyal audience from the larger social masses. Filtering those loyal users would provide them with even more personalized experience with the brand (Wright, M., 2009). After clicking on a certain picture you are re-directed to the online store of the company and this can result sales transactions.

Even though the interactivity between brands and online users has increased, that does not automatically follow to a successful customer relationship. Another prominent online platform, created by the company is “Burberry Bespoke”, which allows customers to customize their own Burberry trench coat. Engaging with their audience on regular basis allow the company to improve the customer relationship bounds. This is clearly confirmed by the statement of the previous CEO of the company Angela Ahrendts:“ Personalization plays a key role in Burberry’s digital strategy, in both communications & product ” (Doran, S. 2014). Social media enable relationships to be managed on the level of the individual consumer – it is informal and personal, as consumers share their likes with others within their network and beyond (Hennig-Thurau et al. 2010).

The Internet is also great for addressing the individual’s social needs, such as in the case of developing online communities. (Christodoulides, 2009). Burberry’s own platforms can be considered as online brand communities as well. Brand communities are seen as a specialized, non-geographically bound community, based on a structured set of social relationships among admirers of a certain brand. They are participants in the brand’s larger social construction and play a vital role in the brand’s ultimate legacy (Muniz & O’Guin, 2001). As Ropper & Fill (2012) mention, the brand community can be an example of a deeper level of association and its members feel a duty to protect the brand’s heritage and reputation. Maintaining and promoting these online brand communities can lead companies to achieve higher brand loyalty and customers’ emotional attachment to their brand.

Using diverse social media channels and engaging its users can lead to the generation of positive word of mouth (Weinberg, Pehlivan, 2011). Word of mouth is nothing new as phenomenon as people have always interacted, shared and exchanged information and their experience among each other. However with the development of the Internet, the traditional word of mouth has evolved into electronic word of mouth (eWOM), which is even more powerful as can be available and reach broader masses of people worldwide via the Internet (King et al, 2014).

In addition to these strategies the luxury brands should never compromise or change their core values when interacting on social medias. They can focus on converting these Facebook and other social media platform followers into valuable luxury brand assets by activating them as engaged and dedicated brand ambassadors. Storytelling by using iconic products, publicity and experiences in order to educate the users and engage those brand ambassadors. These stories can help people understand even better the brand itself, make personal connection and demonstrate how they are contribution to the brand.

Conclusion

The biggest challenge for the luxury brands is to balance compatibility with the social media as communication channels. It is important to define their principles for successful online brand behavior, which does not compromise their brand values. Luxury brands should prioritize a stable two-way communication by the social media in order to sustain product awareness and relationship with users. Burberry is one great example of how a luxury brand creates accessibility within diverse social media platforms, while still remaining exclusive. In conclusion, when going online luxury brands, should consider the importance of converting the online brand strategy into an interactive and engaging experience for their users and online communities.

References:

Corrigan, P. (1997). The Sociology of Consumption, Thousand Oaks, CA: Sage
Christodoulides, G. (2009). Branding in the post-internet era. Marketing Theory,9(1), 141-144.
Deering, Sophie; How Burberry Uses Social Media; available online http://linkhumans.com/case-study/burberry [accessed on 19.02.2016]
Doran, Sophie, 2014 How Burberry Does Digital; available online http://luxurysociety.com/articles/2014/01/how-burberry-does-digital [accessed on 18.02.2016]
Heine, K. (2012) Luxury Brand Management, Technische Universität Berlin, ISSN: 2193-1208, www.luxury-brand-management.com.
Hennig-Thurau, Thorsten, Charles F. Hofacker, and Björn Bloching. 'Marketing The Pinball Way: Understanding How Social Media Change The Generation Of Value For Consumers And Companies'. Journal of Interactive Marketing 27.4 (2013): 237-241.
Kapferer, Jean-Noël and Bastien, Vincent (2012); The Luxury Strategy
Break the rules of marketing to build luxury brands; Kogan Page
King, R.A., Racherla, P. & Bush, V.D. (2014). What We Know and Don’t Know About Online Word-of-Mouth: A review and synthesis of the literature, Journal of Interactive Marketing, vol. 28, Available Online:
Muniz Albert M. Jr. and Thomas C. O'Guinn (2001), Brand Community, Journal of Consumer Research, 27 (March), 412-32.
Roper & Fill, (2012); Corporate Reputation, Brand and Communication; Pearson Education Limited 2012
Vernuccio, M. (2014). Communicating corporate brands through social media: an exploratory study, International Journal of Business Communication, vol.51, no.3, pp.211-233
Weinberg, B. & Pehlivan, E. (2011) Social Spending: Managing the Social Media Mix. Business Horizons. 54 (3). p. 275-282.
Wright, M. (2009); Should luxury brands build their own social networks? Available online: http://www.whythisway.com/2009/10/should-luxury-brands-build-their-own-social-networks/ [accessed on 17.02.2016]