Luxury is all about exclusivity, providing unique experiences, fostering deeper customer engagement, and creating emotion around a brand. Yet, while 40 percent of luxury customers access the internet daily through a smartphone, fewer than 4 percent of brands fully leverage the contextual mobile-social advantages to market these attributes.
While the general perception of mobile is that of a mass-marketing medium, its capability for social interaction and highly personalized content also lends itself well to providing targeted offerings to a high-demand audience that expects incomparable service. The integration of social networks with inherent mobile location features (now collectively coined "SoLoMo") is transforming customer engagement with brands and revolutionizing marketing.
Here and now: The evolving luxury market
In recent years, the global luxury landscape and the luxury customer have evolved drastically due to a shifting economic climate combined with unprecedented technological innovations. Consumers today are focusing less on conspicuous consumption and more on experiences that will intrinsically improve their lives. This demographic is demanding premium, accurate, timely, and engaging information.
According to The Affluence Collaborative, a research powerhouse that studies the habits of high-income consumers, "the affluent seek out companies and brands that can simplify and improve their lives." Time-strapped wealthy consumers will put a premium on services that can save time or deliver memorable experiences. Companies will need to consistently reinforce their value propositions to ensure their products and services are "worth the money."
So, who exactly is the modern luxury consumer? While definitions vary according to source and geography, The Affluence Collaborative classifies the "affluent" in the U.S. as having a household income of at least $200,000 while the "wealthy" have an income of more than $500,000. Furthermore, recent reports indicate that approximately 3 percent of the U.S. population, or roughly 4 million people, earn $200,000 or more a year.
Connecting with discerning customers anywhere, anytime
The digital media revolution, particularly the social and mobile convergence, has especially empowered consumers. More frequently, it is luxury customers who are leading the pack in terms of being tech-savvy.
According to The Affluence Collaborative, 57 percent of the wealthy stated that they like to have the latest gadgets and to be in the know about what's up-and-coming in the tech realm, compared to only 18 percent of the general population. An estimated 72 percent of the wealthy are active Facebook members. They're also using Twitter more often: Twitter usage increased by 350 percent year over year in 2010, and is expected to continue at this rate of expansion through this year.
SoLoMo-based strategies can play a key role in getting consumers interested and excited about new events, experiences, and products. Instead of launching one-off initiatives, luxury brands should develop social-mobile programs that authentically interact with an audience in a way that is personal, seamless, and enhances brand identity.
Experience as the new aspiration
Luxury brand advocates are drawn to the aspirational qualities of their preferred brands beyond price, social "badges," or implied lives of privilege. For successful brands, this cache can extend beyond the product itself to encompass many facets of an exclusive lifestyle experience. For audiences on the move, especially the younger set, it's about having ready access to premium recommendations at every turn.
Capitalizing on mobile location and social affordances within a branded app can enhance on-the-go suggestions around a product. For example, hyper-localized search and GPS-aware apps can make lifestyle recommendations actionable in the context of places to "see and be seen," while social networking provides a natural viral momentum for elevating the brand.
Some fashion companies have launched destination-themed apps to create a following around the brand's style maker recommendations. The Louis Vuitton Amble iPhone app aims to create a following around "It Boys and Girls," chic insiders who curate hip hotspots in cities around the world, while weaving in their enjoyment of brand products and services. Because mobile devices are likely to be with consumers wherever they go, a city guide app guarantees the brand is along for the ride.
Exclusivity with insider access
The social capabilities of mobile can enable luxury brands to retain that inner-circle feeling around key events. Delivering exclusive previews or behind-the-scenes content such as product launches can offer loyal subscribers an additional rung of "insider" experiences.
The strategic use of Twitter and Instagram in the mobile context has the potential to elevate brand awareness around events with greater real-time and viral effectiveness than a traditional campaign, while still maintaining an up-market atmosphere. Burberry quickly won over the London Fashion Week preview as the brand tweeted runway looks mere seconds before they debuted on the catwalk. Guest tweeters took over Burberry's Twitter accounts across the globe, and the brand trended worldwide.
Innovative mobile technologies for moments that matter
Leveraging innovative mobile technologies can also help to define luxury brands as cutting-edge companies. Balancing innovation with user-friendly interaction helps to create dynamic campaigns that provide real-time benefits to customers and followers at key moments. These types of mobile campaigns are much more relevant than traditional advertising.
The Mercedes "Tweet Fleet" campaign assisted hundreds of drivers searching for parking in downtown Stuttgart, Germany, during last year's busy holiday season. The campaign was comprised of a fleet of Mercedes looking for empty parking spots. When an empty space was found, a tweet would be automatically sent through the Tweet Fleet account with GPS directions. The solution merged the in-car park assist feature of Mercedes vehicles with crowd-sourcing to push content via the drivers' dedicated Twitter accounts to both the dashboard and mobile interfaces with alerts and directions.
Enhancing the human touch
For luxury travel consumers, the brand must be synonymous with personalized and memorable "once in a lifetime" experiences that cut across all touch points, from digital to in-person interactions. While hotel travelers still expect face-to-face attention for core guest services such as checking in (according to a survey conducted by the Four Seasons), there are opportunities to foster immediate staff attention through appropriate use of social media with mobile.
Prestige hotel brands can respond to a guest's implicit pre-arrival requests ahead of time, or address immediate in-transit needs through the Twitter channel. For example, after a guest at a Four Seasons resort made a light-hearted comment on Twitter about the hotel's music, she later received a bottle of wine and a note from the general manager apologizing for the "Muzak" tunes along with a listing of local radio stations. When a guest lamented via Twitter that there were no good movies on TV that night, the concierge pointed her to the hotel's expansive DVD movie library.
From the harried business traveler to the family on vacation, mobile combined with social media has tremendous potential to enhance customer service and build brand equity for high-end hotels.
SoLoMo on the go
Location-based services such as Foursquare and Gowalla are becoming essential tools for providing concierge-type recommendations. Four Seasons was one of the first luxury hotel brands to go the geo-social route with Gowalla for engagement and promotional purposes. Its Gowalla app offers guests concierge recommendations while traveling and allows them to earn hotel credits.
The ability to create an instant, unique touch point with consumers means that the location-based concept is quickly spreading globally. Louis Vuitton, which has already used Foursquare for location-based marketing efforts in the U.S. and U.K., partnered with Chinese check-in service Jiepang to launch a similar experiment in Beijing for its travel exhibition at the National Museum of China. Those who checked in to the exhibition using Jiepang's mobile app received a branded virtual badge and a preview of Louis Vuitton's profile page for tips and information about the brand and conceptual design.
Changing luxury landscape
Luxury brands needn't worry that democratization powers of mobile and social will dilute their image, as these channels can actually render more authentic, on-demand, and personalized experiences. Furthermore, marketers must bring localized mobile strategies to younger as well as emerging global audiences where mobile consumption has the largest reach. The brands that will leapfrog over competitors are those that capitalize on new technologies through a combination of localized apps, mobile websites, and exclusive social media campaigns.
In the age of social media, brands must give consumers reasons to believe that the brand narrative is genuine, especially via mobile. This requires a greater level of participation, both from the brand and its customers. Luxury customers do not want to be told, they want to be shown.
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