Harmonious Luxury Marketing

In the Hutong
In the groove
2059 hrs.

On Monday I explained why I felt that the restrictions placed on luxury outdoor advertising in Beijing are aimed not at the goods themselves, but at ending ostentation. While it is too early to say whether the restrictions will be broadened to other cities or other media, there are several reasons that the measures should give pause to all of us in the business of marketing luxury items, whether they be gadgets, gold, leather goods, or private aircraft.

First, the measures are a reminder that advertising luxury goods in China’s mass media is wasteful. Too many of the “impressions” in outdoor advertising are people who not only have no intention or ability to buy the product advertised, they will likely never have the ability to do so. Media companies may argue that those impressions that are not wasted are worth all of the waste, but let us not forget that the waste factor is immense.

Second, the measures are a signal that there may be such a thing as “negative effectiveness” when making desirable the unaffordable and unreachable. We assume there is spillover, but we never actually track the effects those spillover impressions have on the “wasted” audience. Are the messages and ads simply ignored? Or do they engender a negative reaction? Are we, as the Beijing Administration of Industry and Commerce apparently fears, seeding resentment that undermines social harmony? How do we know?

Third, the measures are a reminder that the end (selling more baubles) does not always justify the means (any creative that gets the buyer to pay attention). There are ways to create mystique and value with an advertising campaign that are more imaginative than pairing a luxury good with panorama of a luxurious lifestyle or with a half-naked supermodel. Are there ways to ensure that the results of the spillover are positive? And if so, shouldn’t we be pursuing such a course?

Why Should We Care?

All of those questions can be dismissed by marketers as “not our problem,” and a fair case could be made that we would be technically correct in doing so. After all, we are paid to deliver sales, not worry about people who are angry at being unable to buy our product. In fact, when you think about it (we tell ourselves), such frustration might actually be a good thing.

Such rationalization is perfectly true, right up to the point where the government decides that your ad pisses off too many migrant workers. At that point, you may lose the ad, or you may lose access to a channel completely. The smart move is to think ahead, and that begins by buying into some basic principles.

Four Principles

Principle I:  There are more effective ways to market luxury goods in China than mass media. A corollary: there are now more ways than ever to conduct effective luxury goods marketing. Even if you have a fixation with paid media, you are better off using direct mail, flagship stores, relationship marketing, and carefully selected online media and, when it comes, mobile media. In fact, luxury brands should be driving the push to online marketing that individually targets a user, rather than just takes space on a page.

In luxury goods more than any other industry, it is even possible to lead with below-the-line approaches like tightly targeted public relations, trunk shows, store openings, and other tactics that take a personalized, bespoke approach to marketing and eschew writing advertising checks altogether. The options continue to grow, and they keep getting more tightly targeted. A close friend of mine gets a birthday card every year from Cartier on the basis of a single small purchase she made on the basis of word-of-mouth.

Principle II:  We need to learn to understand, measure, and avoid “negative effectiveness” in marketing in a country with deep and active social fault lines, regardless of what we are selling. This does not apply only to China, but to any country in which a luxury brand sells. We are very good at understanding the positive consequences of our communications, even if we do a mediocre job of measuring them. But we ignore the negative consequences until they blow up in our – or somebody else’s – face.

But for every Groupon/Tim Hutton Superbowl gaffe, there may be two – or dozens – of campaigns, ads, or messages that don’t just fall flat with our non-targets, they get people to actually hate us. Until we learn to measure how many people our marketing pisses off, why it does so, and understand what that means for the brand, we may well be doing more net damage than good.

On the other hand, if we create campaigns that get our target audience to buy and engender goodwill from people who will never buy our products, we will have lifted our brand and our products to an entirely new level. See Principle IV.

Principle III: In our own enlightened self-interest, all of us in the marketing profession need to behave with greater sensitivity to the people at the bottom of China’s pyramid. This requires no great explanation, just a thought. After nearly 34 years of reforming and opening, China is still home to hundreds of millions of people who live on less than $1 a day. Before you submit that ad for approval (or before you approve it), picture in your mind a photograph: your ad, on a bus shelter, with a poor Chinese farmer in a threadbare blue Mao suit walking past. If that image looks wrong, rethink the ad, if not the campaign.

Alternately, imagine your copy or your messages being read aloud to a meeting of senior Party ideologues. Does it still sound okay? If not, rewrite.

Principle IV: Great luxury marketing goes for the organ between the ears. It is a huge temptation to conduct marketing that appeals to our baser instincts. It’s easy, it gets attention, and it sells. Leaving aside any moral issues, using such an approach to sell luxury goods is probably what got us to the current situation with the outdoor advertising restrictions. And it is just unnecessary.

Take, for example, Rolex, a great luxury brand. For decades, the company has been running a campaign celebrating explorers, pioneers, and other people of noted excellence in their fields of endeavor. These are not people getting out of Bentleys or fondling the latest Victoria’s Secret model. The ads have a distinct aura of class, style, and excellence, and have helped establish Rolex at the top of the luxury timepiece market, all without sex or decadence.

Not every luxury company can use the same strategy as Rolex, but marketers are paid for creativity. Any half-wit can conjure (or approve) an ad campaign that speaks to greed or the gonads. Good marketers – and wise clients – know that they don’t have to. That applies triple when selling high-margin merchandise like luxury goods.

Selling Baubles Better

There is a business case behind each of the principles above, either maximizing efficiency, minimizing the chances of blowback, or creating more memorable and meaningful campaigns. But there is a moral point to be made, and with your permission I will finish on this note.

When we market luxury products, we create desire for the unnecessary. That is the hard truth. Doing so is defensible, though perhaps not a virtue, when we create that desire in people who have more money than they can spend. But it is indefensible when we do so in people who have less money than they need, and it is reprehensible to say that such accidents are not our problem.

Great companies, great brands, and great executives do not shy from that quandary. Instead, they let that struggle be a part of what defines them, not just because doing so offers great commercial rewards (it does), but because it is the right thing to do. That essence should be a part of every brand, but the obligation rests heavier on those who create and sell “the finer things in life.”

About David Wolf

An adviser to corporations and organizations on strategy, communications, and public affairs, David Wolf has been working and living in Beijing since 1995, and now divides his time between China and California. He also serves as a policy and industry analyst focused on innovative and creative industries, a futurist, and an amateur historian.
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