At the recent Financial Times Luxury Summit in Los Angeles, Jean-Christophe Bedos, the CEO of Boucheron, made the following comment: “Consumers trust recommendations from friends and family, and where they connect with them is on sites like Facebook. It’s not a question of whether or not you should be there, its how you should be there. If not, you are losing an opportunity to monitor what is being said about you in the digital space.”
According to latest 2010 Wealth Survey by The Luxury Institute, a study of respondents with an annual income average of $150,000-$286,000 and $2.7 million average net worth, peer-to-peer recommendations are an important aspect amongst today’s luxury consumers. According to this study, the most influential factors in purchasing behaviors are as follows: 39% of respondents are affected by ratings and reviews from trusted sources, 31% by recommendations from family, and 34% from friends.
Respondents indicated that the least likely to have a positive influence on their purchasing decision are invitations to events for networking with celebrities (3%), and heavy advertising in print publications (3%). Today it is the human connection amongst consumers that is driving commerce and social media is the vehicle for which peer-to-peer recommendations take place.
In a previous post Why Luxury Brands Can’t Borrow Communication Strategies From Premium Brands, we discuss consumer attitudes towards luxury brands and the notion that a certain level of exclusivity must remain as a means to garner the interest of luxury consumers.
Further, below is a diagram that breaks down the operational differences between social media and a luxury brand.
Even though the models appear to work counter-actively, it’s the human connection that ties the two together. So how then, can luxury brands best utilize the opportunities of social media without damaging their image?
Luxury brands should treat their online engagement strategies like theme parks, and showcase different characters and ‘experiences’ for audiences to enjoy. It is these experiences that lead audiences to the gift shop (products).
However, “experiences” should not just be focused on the brand and its defining qualities; rather the brand should choose to interact with audiences that share the same passion and voice, (think quality over quantity), and go beyond sending press releases through social media feeds. Allow for some strong online fans to interact with your company, in a way extending ‘theme park’ parameters for your brand.
Based on this format, word of mouth and peer-to-peer recommendations will take place naturally…
Photo Credits: ffffound.com
Written by: Agata Seidel
All articles are copy-edited by Gina Conforti
