The 6 P’s of Luxury Marketing©

Jeff Winsper, president of Winsper, shares a summary of his marketing firm’s recent white paper on a compelling framework for assessing the behaviour of today’s luxury consumer.

As often as not marketers have approached luxury consumers using simple demographic criteria: zip code they live in, the college they attended, their occupation, income, or investable assets. But today’s luxury consumers are more diverse and complex than ever, and this defines how they purchase goods and services.¹

Failure to recognize these distinctions can result in disconnects when it comes to understanding—and marketing—to luxury consumers.

Relying on years of experience of effectively marketing to the affluent, Winsper rejects any traditional one-dimensional approach. In order to win new customers, luxury marketers need to take a more nuanced approach that recognizes that their consumers may well fall into many different categories—perhaps even down to the individual level.

Moving beyond simple composites of the affluent based on typical demographic data representing the “what” (financial resources) and “where” (zip code) of affluence and consumption, Winsper’s approach allows marketers to align their brands with the who, why, when, and how of this highly desirable, profitable, and important audience.

To help luxury marketers better understand how to communicate and connect with their audience in a more meaningful (and, ultimately, successful) way, Winsper is introducing the 6 P’s of Luxury Marketing©, a framework that embraces all the touch points between luxury brands and consumers. Using the 6 P’s as a foundation will enable luxury marketers to better understand their customers and build longer-lasting, more profitable relationships with them.

The 6 P’s of Luxury Marketing

Listening to the customer has led Winsper to define six key areas that luxury marketing must pay attention to—people, product, passion, pleasure, purpose, and price. These areas—which fully cover what matters most to luxury consumers—have been identified based on Winsper’s years of experience in observing and communicating with high net worth individuals at work, at play, at home— and all the places in between. Seriously considering the 6 P’s as an integrated framework, and understanding the reciprocity of the “P’s” within this framework, will greatly impact the way luxury marketers approach their customers and allow them to create unique relationships throughout the buyer’s journey.

1. People: They Buy From People
Whether someone is selling a product through a channel or using a direct sales model, the value of people in the buying process is critical to the success of business transaction. And that is just the start of the fruitful journey of building brand loyalty. The most successful luxury brand organizations have built best practices for the proper training of their brand ambassadors who directly/indirectly touch the consumer (e.g., salespeople, customer service representatives, phone operators, etc.).

2. Product: The Six Key Characteristics of Luxuries
Within the 6 P’s of luxury marketing, product quite naturally plays a central role. Through extensive interviews with luxury goods consumers, French marketing professor Bernard Dubois identified six key characteristics of luxury that are inherent in a product and/or its brand: quality, heritage, integrity, price, scarcity, and superfluousness or non-utility. These characteristics will mean different things to different people.²

3. Passion: Connoisseurship Shared in Real and Virtual Communities
The pursuit of luxury is often a passionate endeavor and the affluent can be very passionate consumers. In many instances, it is their passionate nature that has put them in the position to access the luxuries that comprise their lifestyle. Passionate consumers share their passion in a variety of “old-fashioned” (clubs and association) and emerging (online communities, blogs) arenas. Luxury marketers need to be particularly cognizant of what’s happening online: both good and bad news travels fast.

4. Pleasure: Luxury is Experiential
Pleasure derived from luxury consumption comes from the experience. A luxury experience implies an emphasis on senses and emotions. Luxury marketers need to ensure that their customers have the opportunity for sensory connection with their products, and should also consider emotional appeals in their marketing campaigns.

5. Purpose: Luxury May Have an Element of Superfluity, But it Can Also be Practical
Although luxury might be superfluous, it also serves a purpose. Most luxury products have a utilitarian aspect, which is more or less important to different individuals. Luxury marketers should arm themselves with a combination of practical, factual information, and ways for customers to connect to the pleasure aspects of their products. Luxury customers will place varying weights on the importance of pleasure vs. purpose. Marketers need to be prepared for all possible combinations.

6. Price: The Rise of Fractional Ownership
Money matters to the affluent, who tend to spend rationally, even if they seem to spend a great deal. Aware of the many downsides of ownership, the affluent increasingly favor fractional ownership. While fractional ownership may not always be relevant, luxury marketers should consider adding this to their mix.

Conclusion

Luxury consumers can be better approached through taking into account variables based on their individual needs, wants, and values as opposed to a “one size fits all” template.

The 6 P’s system has been tested and readapted many times, and can provide luxury brands with a comprehensive tool to develop fine-tuned value propositions for smaller subgroups, and even for individuals. This results in better outcomes with a wider audience of affluent individuals. Reflecting on the brand’s 6 P’s assets, luxury brand managers can determine what combination of P’s will best impact the targeted segment and deliver the desired interaction.

Jeff Winsper

Bibliography

1. Dubois, B., Laurent G. & Czellar, S. (2001). Consumer rapport to luxury: Analysing complex an ambivalent attitudes. HEC School of Management.
2. Case, T. (2004). Mass market. Adweek, Vol. 45, 33, pp. SR16-SR18.