AN EXAMINATION OF THE IMPACT OF LUXURY FASHION BRANDS ONLINE MARKETING ON CUSTOMER RELATIONSHIPS AND PURCHASE INTENTIONS

CHAPTER ONE

INTRODUCTION

Background

The power of luxury brands has always fascinated marketing practitioners and dominant researchers due to its implications on potential customers. The most practical definition of luxury brands postulates them as the chief goods with a low ratio of functional utility to the attached price and high situational efficiency to the price (Arora & Kishor, 2019, p.38). The consumers buying trends and intentions are influenced by a diverse combination of both internal and external precursors. Luxury brands have proved to be critical industry leaders with excellent and aesthetic values in the fashion industry and a distinct traditional management approach in business (Shen, Choi & Chow, 2017). The brands have also been recognized over time for their ability to struggle through adversity while creating a reliable combination of functional marketing mix approaches, the offering of quality differentiated products, and employing outstanding customer management strategies.

However, the industry marked with diverse challenges in a bid to maintain its market proposition. The current technology dominated and competitive business landscape has forced the industry to strategize in an attempt to meet the increasing demands in customer acquisition and satisfaction levels (Arora & Kishor, 2019, p.37). The recent entry of diverse players in the industry, coupled with the current economic downfalls, has been much intriguing to the business segment. The fact that the luxury industry is considered to be a high-end platform with an automated profit platform has encouraged the lower segment industries to try a hand in the perceived market and client databases. The luxury brands have been to react and counter the effects of the possible competitions by employing social media platforms as the core marketing platforms (Kim and Ko, 2010). The initiated social media approach denotes a double and two-way approach mechanism aimed at encouraging clients to share their dominant opinions and observations about the viability of the offered goods and services.

The inclusion of social media platforms, including tweeter and Facebook, has already been included in the businesses’ trademark operations as dominant tools to survive the accruing market competition. The increase of online platforms as the dominant communication channels employed by the luxury brands has encouraged the need to examine the impact the channels in maintaining customer relationships and the intentions to purchase the available goods and services. The perceptions of the customer relationship are closely interlinked with the possible trust and purchase intention decisions by the customers. The study encompassed drawing a possible sample from the proposed fashion industries to unearth the study intentions.

Social media platforms have been classified among the most effective platforms in marketing across the globe. The growth of social media platforms and the increase of services offered across social media platforms have led to the integration of marketing activities (Vries et al., 2012). The rise of the social media platform has led to the evolvement of new challenges and growth of opportunities for the development brands. The availability of social media platforms accessible in 24 hours in mobile devices has created opportunities for one to one relationship building. Social media is not only essential as a marketing platform but also in developing brand loyalty (Hennig-Thurau et al., 2010). The context of the research study is established based on luxury fashion brands.

However, despite the high-end use of social media as a marketing platform, lack of understanding of the impacts of the approach in various products and services need to be investigated. The need for more analysis of the implications of the social media marketing analysis approach is required. This study is developed base on critical analysis and as a response to previous researches (Ahmed and Zahid, 2014; Vries et al., 2012).

Research Questions

In order to explore the existing gap in the marketing of luxury goods significantly on the social media platform, the study is developed based on the following research questions;

1. Does social medial marketing have effective strategies employed by luxury brands in the creation of awareness?
2. Does the social medium platform have impacts on approaches employed by luxury brands building?

• What are the best practices in spearheading an online brand awareness campaigns?

Objectives of the Study

The study is developed based on the following research questions;

1. To determine the distinctive strategies employed by luxury brands in the creation of brand awareness in online platforms;
2. To explore the impact of diverse approaches used by luxury brands in building an online presence;

• To determine the most effective marketing practices in spearheading an online luxury brand awareness campaign.

The study involved the collection of critical data from luxury customers via the use of self-administered questionnaires in Memphis. The key respondents encompassed any consumers who had purchased a luxury brand commodity for the last one year. Out of the 150 distributed surveys, only 133 were reliable to conduct the analysis. The principal analysis component was employed to determine the critical properties of luxury brands. The basic features in the social media domain included the trends entertainment aspects, necessary customization, word of mouth marketing (referrals), and the interactive aspects of the platform. The multiple regression analysis was also employed to determine the impact of the approach in the customer relationship aspects, which include customer intimacy and accruing brand trust. The examination denoted that the brand awareness campaigns had the highest impact on the customer’s entertainment aspect domains.

Significance of the Study

Significantly, the study contributes to theoretical development terms. The study is developed based on model integration that utilizes a full range of the individual and stimulus level variables together with diverse outcomes in social media marketing of luxury products. The study also contributes to the marketing managerial approaches. The findings are essential in the identification of the most suitable strategy for the social marketing approach, especially for luxury goods.

CHAPTER TWO

 LITERATURE REVIEW

Social Media Marketing of Luxury Fashion Brands

The evolution and dominance of online platforms have encouraged luxury brands to capitalize on the gap in a bid to amplify their voice and reach out to potential clients. These avenues have proved to be reliable pathways in increasing the brand’s awareness on one hand while making possible sales on the other. This has forced many luxury brands to create twitter and Facebook pages to ensure that they can communicate to potential customers without any restrictions (Adjei & Noble, 2010). The brands have created avenues to create an interactive communication channel with current customers and potential clients. However, the key theme in creating these approaches has been coined on the need to develop a large following. The stories and images which are posted in these online platforms are carefully crafted to create a lasting illusion and an insatiable desire to associate with the brand). Adopting the right strategies in the use of social media and other online domains encourages luxury brands to build their image and influence the customers purchasing decisions. The increase in the number of people using online platforms increases the brand’s ability to choose its strategic niche and reach its target clients with carefully created messages (Arora & Kishor, 2019, p.37).

Customer Relationships

The emergence of new players in the luxury business has created a cut-throat competition in the field. The perceived loyalty towards certain brands has withered away, and these changes cannot be ignored in the contemporary age. These pose the need for luxury brands to create reliable networks with the key clients to develop a sense of intimacy and innate trust. Communication is critical to spearheading brand awareness, and brands that do not communicate their key messages lose it all (Shen, Choi & Chow, 2017, p.180).

Brand Awareness

Luxury brands present one of the most complicated market domains. They are fascinating based on their approach and allure to potential customers. The success of a brand in the market is based on its ability to capitalize on the marketing mix. The rationale for the success of the brands is based on the following dimensions (Jain & Mishra, 2018, p.420).

 Brand Performance

The rationale of performance can be viewed in two distinct levels, both at the product aspect and the experiential dimension. The first attribute denotes that the product must fully comply with the functional domains of the perceived importance by delivering in line with its practical characteristics. These dimensions are interlinked with the product’s quality and excellence in performance (Kim and Ko, 2010). The implications of these traits can be based on the product’s performance aspects as well as the distinctive attributes which keep it apart. The craftsmanship and precision in terms of design, technology, and innovation aspects are critical in determining product performance. The luxury brand must always outperform at the experiential level to fulfil its perceived emotional importance. The product should improve performance beyond accrued expectations (Arora & Kishor, 2019). The performance of the product is meant to preserve and represent the brand’s image to the contemporary customer.

 Product Pedigree

The ability to maintain a rich pedigree concerning the product’s past and current market domains is a crucial determinant of the perceived performance in the larger domain. These aspects determine the product’s ability to keep dispensing of the perceived mystery in terms of performance and accrued satisfaction levels. The distinctive attributes revolve around the exceptional history of the product and the dominant characteristics. These are the key traits in creating the product storyline and the brand image (Gautam & Sharma, 2017, p.880). The ability to maintain a consistent image in the market domain is critical in enhancing the choice of the products via online platforms. The truth lies in the fact that clients are ardent in marketing products that meet their imminent needs. The clients market the products through word of mouth referrals. These affirmations denote that customers buy products through their intent even though the brand’s online presence subconsciously influences them (Shen, Choi & Chow, 2017).

Product Paucity

The key message which is employed in marketing the brands is framed around passing the critical message that the products are precious and scarce. The fact that clients act from a spirit of want forces them to keep chasing the products to fulfil the innate needs of irrationality and emotional instability (Shen, Choi & Chow, 2017). The key message which is passed through the online platforms urges clients to join the trend and become part of the greater perceived team and influence. Paucity is interlinked with coordinated marketing to push precious and luxury goods to the market. For instance, Burberry wasted a critical image of the fact that its products were only consumed by the elite, thus losing a dominant share in the market proposition (Gautam and Sharma, 2017).

Brand Persona

The online presence of a brand gives it a distinct persona. The communication is centred on maintaining a consumer touch to ensure that the targeted population can relate to the brand’s attributes. The online visual presence of a brand is meant to spread the brand’s authenticity and perceived emotional value to potential clients (Kim and Ko, 2010). The dominant enhanced of the online marketing strategies are meant to enhance the brand’s viability through marketing its visible traits to prospective clients. The online domain capitalizes on the use of brand colors and icons to differentiate luxury products (Gautam & Sharma, 2017).

The online messages should be framed in an emotional design to create a distinction between the brand and potential competitors. The coordination of the online campaign leads to the creation of a brand image that is in line with the execution of the product’s marketing objectives. The inclusion of short videos has enhanced the consumer’s ability to relate to the luxury brand on a personal level (Lee & Watkins, 2018). The fundamental essence of creating an online brand image is attached to its ability to convince several reliable clients within a compact time frame. The brands have been known to stimulate the emotional domain of individuals by generating genuine and differentiate affinity so that the clients can directly relate to the products to solve their innate needs. The process has been spearheaded by the launch of relevant applications to ensure that the potential customer is hooked to the brand’s perceived importance. The use of websites has also proved to be a viable option in attracting potential clients. The principal aim in adopting social media and other online domains has been coined in need to cultivate the client’s possible desires in associating with the product Eom and Seock, 2017).

Capitalizing on Online Public figures

Luxury brands capitalize on the charm of celebrities to enhance their marketing and solicit for online attention. Celebrities assume a differentiated niche in the online marketing of luxury brands and products (Gautam & Sharma, 2017). The importance of the emotional attachment created by the public figures encourages the entire population to follow the products, and these create an emotional attachment in the long run. The possible influence of the celebrity is interlinked with the consumer’s emotional affinity to create awareness of the products. The ability to link products with celebrities’ lives creates a permanent need to accept and purchase the products to enhance the self-esteem levels and sense o belonging. Research has proved that the marketing domain is an illusion aimed at creating gaps in the consumer’s perceptions (Kim and Ko, 2010).

Brand Placement

The rationale of creating an online marketing platform is espoused on the need to influence the customer’s heightened perceptions by enlarging the possibilities of the perceived brand. A well-crafted online strategy is geared towards soliciting the necessary online support to influence the followers (Shen, Choi & Chow, 2017). The changing tastes of the contemporary client have encouraged individuals who are in the luxury business to frame and design the appropriate strategies in enhancing the product’s online presence and accruing consumer decisions. The essence of building awareness through online marketing encourages individuals to adopt the proposed lifestyles and own the brand (Eom and Seock, 2017).

Online Public relations

Online platforms are meant to promote public relationships from public opinion. These can be attained by ensuring the availability of regular supporting affirmations to the products and luxury brands (Shen, Choi & Chow, 2017). The online platform provides that there is an ongoing communication platform in a bid to unearth and understand customer needs. The luxury products are also directed towards the creation of an online class and differentiation aspect of the main products. These, coupled with the emotional attributes of the clients are meant to encourage the consumption of the product, and these denote an increase in brand awareness efforts. The success of the marketing approach has bound the creation of online buzz, which is an essential part of brand building initiatives (Arora and Kishor, 2019).

The Product Pricing

The use of online platforms to market products ensures that the clients create a mental image of the perceived importance and value attached to the product. The presented price builds a permanent stature on the customer’s perceptions in the long run. The fundamental rationale of adopting online channels in the pricing domains is meant to encourage the client to relate with the product on a subconscious level. These pose the need for luxury brands to adopt a rigid pricing strategy as setting the price lower than the consumer’s perceived value can have long term implications for the brand (Arora and Kishor, 2019)

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