luxury vs mass

Today I'm gonna post a short-talk in bahasa! ^^

Few days ago I had an interesting discussion with my fashion marketing students. A small-to-spare-some-time-for-finishing-the-class-discussion but ended up in a fire-in-the-class-talk.

We were talking about Gucci Group, which surprisingly (some of us just knew about it) is one of the giant fashion group who controls not only Gucci itself, but Balenciaga, Stella McCartney, Sergio Rossi, Boucheron, YSL, and Alexander McQueen also. From the discussion of Gucci, there was an interesting question about how to position a brand from the market, luxury or mass.

Mass market is actually very simple to be described. It is the market for everyone. Low, middle, or even upper. They all have the same access for the market. The difference is probably on their buying behavior. Some real examples for this market can be very large numbers in practice. If you visit your nearest mall, you probably gonna find most of them are products for mass.

Mass is not only for mass people, but some brand position themselves for middle to upper market. It's not luxury but it's mass. It's premium. Here where brands usually have mistakenly put themselves on. Or the other way, consumers make a mistake about categorizing their favorite brand as luxury. Some players in this market are Zara, Esprit and Mango.Their price range is from hundred of thousands to millions of rupiahs. It's not so expensive though for the current segments although some similar styles and design can be found on mangga dua for only fifty thousands.

Meanwhile, some mega players on luxury market are getting wild. LVMH, Gucci, Burberry, and the lowest rate among them, Chloe, have different strategies among themselves.

The beginning question of this talk is related to how LVMH and others can enter and compete with other mass players. It's interesting to see how they react. An example is Japan market. Everyone, i think, agrees that Japaneses are unique. They are so cultural oriented in one side, but still welcome the modernized effect. As one of the potential market for luxury brands, mostly because of the high gross domestic product as a result of a better economic growth, most of Japanese able and capable to purchase luxury stuffs. Look at LVMH. LVMH claims that it has acquired 95% of female from 20s to 35s years old in that country. Imagine that! Interesting to see here because most of female in that age period has two choices, work, or become a housewives. Most of them work hard before married, and when it's time to get engage in a serious relationship, they will, mostly, decide to quit from their job and depend on their husbands for living.

If I can make a comparison between Japan and Indonesia, it is similar to see. I can conclude that one of two Indonesian females owns an LV product. Although apparels of LV are not so common here, but bags, wallets, shoes, accessories, etc,. can be seen almost everywhere. The next question to be raised is: Original or Fake?

As an old players, LV has its strategy in marketing. If we think on the international market where customers will be treated as customers, LV implemented a product-diversification marketing. Trunk bags range from million of rupiahs til only less than 2 millions of wallets can be accumulated here. Hence, implicitly, LV plays on mass market with affordable price. But is it true for this case?

My observed-market is Indonesia. Jakarta-based city. A unique place to see how people react with luxury brands. Based on interviews and experiences from students and colleagues, LV stores in some major malls are not really customer-oriented. A survey for LV service performance showed that LV salespeople are so arrogant and discriminate among different level of social and income class. But it explained why their attitudes like that, simple really, they want to maintain their exclusivity. Indonesia is the market of fake-second-hand goods. Visiting places in Jakarta, from exclusive locations until the low-cheap-markets, LV products can be found easily. Hence the behavior of salespeople must be different with the regular-service-oriented strategy. They give best and excellent service to those who really afford to buy the original product.

Did it work? No sales data available yet but based on discussion with the loyal customers, they prefer to buy LV products in the neighboring countries, Singapore and Malaysia. The reason is the availability of newest line of LV and the prestige of spending money abroad.


Does LV or other luxury brands can be said as mass products if they compete with premium or even the mass products themselves? NO!Luxury goods can not be categorized as mass because of the principal difference. Brand NAMES!

Some of these arguments can be the reason why mass really want to be luxury. Large market opportunities and high profit gain make sellers compete to create the best strategies. Photo spread on high-end magazine can be one of their solution. Just look at Vogue, or Bazaar, it is common to find in two pages-side-by-side, readers can see two different brands with different classes.


ps: be continued..