Home Library Translate
A A A
Share »
Follow us on Facebook Follow us on Twitter Follow us on LinkedIn
Connect »

Blog: Marketing and Social Media

Menu

  • This Blog's Home
  • Guest Writer Submissions
  • Policies
  • To Subscribe to a Blog
  • About
  • Feedback

The Luxury Brand Effect: Should BMW Sell Ketchup?

By Lisa Chapman on June 29, 2010

Top Brands in Trouble

Luxury brands the world over are continuing to struggle. Coach, a luxury leader in the leather handbag market, has experienced quarterly profit slumps exceeding 30%; Saks’ same-store sales down in excess of 23%; BMW’s U.S. sales taking a 28% nosedive; Well, you get it.

And consulting firm Bain & Company predicts that the 10% or greater drop in the overall luxury market won’t recover until 2012. Time magazine give us insightful new ideas:

Diversify – The Promise of Pleasure

“What can these brands do to battle this malaise? Maybe BMW should try selling ketchup or mayonnaise. It’s not as ridiculous as it sounds: according to a study in the Journal of Consumer Psychology, recession-wracked shoppers are eager to embrace luxury brand names over a wide range of product categories, including those with little logical connection to the brand’s core item. The authors attribute this phenomenon to the “promise of pleasure” — a brand like, say, Cartier evokes strong, positive emotional responses in consumers, and those good feelings can be easily transferred to stuff like furniture, cheese and even, yes, ketchup.

Expand Luxury Brand Portfolios

“The message for luxury brand sellers is to expand their brand portfolios to small extravagances. The availability of Coach keychains or Gucci flip-flops allows consumers who are cutting back to re-experience the pleasure of consuming luxury without paying a fortune. During a downturn, it’s easier to pay $10 for a nice bottle of ketchup than $60,000 for a sedan (although the ketchup doesn’t handle as well).

Don’t Overdo Luxury Brand Extensions

“There’s a danger in overdoing it, though. Pierre Cardin is the poster child for bad brand extension, according to the Harvard Business Review. “By 1988, it had granted more than 800 licenses in 94 countries, generating a $1 billion annual revenue stream — and profits plummeted,” the authors wrote in a 2005 article called “How Not To Extend Your Luxury Brand.”

Thanks to Time Magazine for the original article.

Time.com in partnership with CNN; By Sean Gregory, Aug 05, 2009

For this article in its entirety, see Luxury Brand.

What diversification opportunities do smaller brands have in this economy?

——————

For more resources, see our Library topics Marketing and Social Networking.

. . ________ . .

ABOUT Lisa M. Chapman: With offices in Nashville Tennessee, but working virtually with international clients, Lisa M. Chapman serves her clients as a business and marketing coach, business planning consultant and social media consultant. As a Founder of iBrand Masters, a social media consulting firm, Lisa Chapman helps clients to establish and enhance their online brand, attract their target market, engage them in meaningful social media conversations, and convert online traffic into revenues. Email: Lisa @ LisaChapman.com

« Previous Next »

Search Our Site

Meet the Blog’s Host

Lisa Chapman serves her clients as a Business and Marketing Coach, Business Planning Consultant and Social Media Consultant, specializing in increasing revenues. [Read more ...]

Recent Blog Posts

  • How to Write Business Proposals
  • How to Deal with Google’s Mobile-First Index
  • 6 Ways to Instantly Reach a Wider Social Media Audience
  • Guide To WordPress Website Creation
  • 7 Mobile Apps to Amp-Up Your Social Media Presence
  • How to Create Content With Long Term Value for Your Subscribers
  • Save Time and Money
  • 10 Best Content Marketing Tools
  • Who Are The Millennials and How Do They Shop?
  • Free and Cheap Press Release Sites for Small Business

Categories of Posts

  • Advertising and Promotions
  • Basics and Overviews
  • Branding
  • Communications
  • content curation
  • General Resources
  • Market Planning
  • Market Research
  • PR
  • Sales
  • SEO Search Engine Optimization
  • Social Media Management
  • social media marketing
  • Social Media Tools
  • social media trends
  • Social Networking
  • Strategy
  • Uncategorized
  • video
  • Web Traffic

Related Library Topics

  • Advertising
  • Business Planning
  • Market Research
  • Customer Service
  • Public Relations
  • Competitor Analysis
  • Pricing
  • Marketing (Overview)
  • Planning (Overview)
  • Problem Solving
  • Product Management
  • Program Planning
  • Project Planning
  • Quality Management
  • Sales
  • Social Networking
  • Branding
  • Communications

Library's Blogs

  • Boards of Directors
  • Building a Business
  • Business Communications
  • Business Ethics, Culture and Performance
  • Business Planning
  • Career Management
  • Coaching and Action Learning
  • Consulting and Organizational Development
  • Crisis Management
  • Customer Service
  • Facilitation
  • Free Management Library Blogs
  • Fundraising for Nonprofits
  • Human Resources
  • Leadership
  • Marketing and Social Media
  • Nonprofit Capacity Building
  • Project Management
  • Quality Management
  • Social Enterprise
  • Spirituality
  • Strategic Planning
  • Supervision
  • Team Building and Performance
  • Training and Development
About Feedback Legal Privacy Policy Contact Us
Free Management Library, © Copyright Authenticity Consulting, LLC ®; All rights reserved.
  • Graphics by Wylde Hare LLC
  • Website maintained by Caitlin Cahill

By continuing to use this site, you agree to our Privacy Policy.X