1. The Business
of
Carol Anne Henry
Global Luxury Management
2015
Luxury

2. Definition of Luxury
“
Italian Vogue, 2011
“
Luxury is a product, service, or experience that is a
culmination of 8 specific characteristics:
RarityExcellence
Expensiveness
Timelessness Honest
TailoredPleasurable
Experience
The luxury market is categorized by three segments
Personal ExperientialTransportation
What is luxury? Quality and not price? Yes, maybe, but it's not enough. Luxury
involves a much wider concept. If you misunderstand it with richness referring
to expensive items only, then you have an old idea of luxury. -Franca Sozzani
Apparel
Jewelry & Watches
Accessories
Cosmetics & Fragrance
Footwear
Leather Goods
Automobiles
Recreational Vehicles
Professional Vehicles
Marine
Aircraft
Hospitality
(food, wine, spirits)
Home/Interiors
Travel Activities &
Management
Collectibles
Real Estate
Charitable Involvement
Personal Health
Management

3. 2014• Global Luxury goods reach 224
billion in revenue in 2014, up
by 3% from 2013
• currency fluctuations in the
first quarter had an impact on
spending patterns
• Luxury Cars are up 10% from
2013
• Hotels up 9% from 2013
• Yachts and jets up 9% from
2013
• Personal Luxuries up 4% from
2013
• Japan, Europe, and the Americas
see positive growth while China
slowed with a negative trend
Bain & Co 2014
Sector
Growth
This data shows how much growth the 2014
market saw within the luxury cars and luxury
hospitality sectors

4. 2015 market estimates
Bain & Co 2015
European market had a good start to
2015, 3-5% expected growth in 2015
expect 1-3% growth in
2015, slower than 2014
due to the dollar
decreasing touristic
spending
Japan is steadily climbing with a projected
5-7 percent growth in 2015
Mainland China projected
to see 2-4% decline due to
spending restrictions
and a more price-
sensitive attitude

5. Sector SIZE Personal
Experiential
Transportation
$700 Billion
$300 Billion
$400 Billion
Personal Luxury
grew 2% from
2013-2014
Luxury hospitality
experienced a 9% increase,
wines and spirits showed
5% increase, find foods 2%
and furniture decreased by
1% between 2013 and 2014
Luxury cars show the
largest increase of 10%,
private jets grew 9%,
luxury cruises 5%, and
yachts showed the smallest
growth with 2% from
2013-2014
Bain & Company 2014

6. Key Trends
for the
Future of the
Global Luxury Market

7. New Consumer Behavior
Creates an
opportunity for
luxury
companies to
enhance the
experiential
aspects of what
they offer.
Putting the Luxe Back In Luxury
“Worldwide, Luxury is shifting from “having” to “being.”
-Shock of the New Chic, BCG 2014
begun to look for
a more
meaningful
purchases and
have lowered their
opinions on luxury
products.
Focusing less
on how much
they have
and more
about the
real value of
what they
have.
Consumers have… Consumers are… What does that mean?..

8. Conscious Shoppers
company efforts to
support charities makes
consumers feel better
about buying their
products
“Affluents are putting their money where their hearts are,
marking a profound shift away from “me-first” to “we-
together”.. -Putting the Luxe Back in Luxury
Putting the Luxe Back In Luxury
Affluent shopper
goals have changed to
encourage quality of
life rather than
acquiring more stuff
affluent customers are still less
likely to sacrifice convenience for
price, but are now more willing to
opt for an environmentally
friendly option

9. Luxury Sustainability
• luxury
companies
are
integrating
sustainable
operations
• consumers
are more
aware of
how they
address
environmen
tal and
social issues

10. Anaya, Suleman 2015
“It goes without saying that being seen as
commonplace is poison for any luxury brand”
-Suleman Anaya, Business of Fashion
Branding Preferences
After two periods of low
earnings in 2009, Louis Vuitton
decided to focus on more
luxurious materials and
reduced the visibility of their
monogrammed products.
consumers are moving
away from visible signs of
luxury shopping and are
instead more interested in
uniqueness, high quality,
and an understatement
less brands are putting out
products with large logos,
consumers are no longer
interested in an item that is
branded all over.

11. Social Media Marketing
“Social Media has changed everything and its existence has challenged the world
of luxury, which traditionally scoffed at the notion of being even remotely
accessible”-Karen Robinovits
Luxury Daily
Social Media creates opportunities for
companies to market their products quickly
to a consumer using various social media
platforms.
• for top designer brands, a successful social
media strategy includes innovative
technology, collaborations, and experience
across social media platforms
• Brands who collaborate with popular
internet entities have successfully given
new life to fashion topics
• Luxury marketers have to accept social
media as a long term fixture in order to
maintain long term growth
Nordstrom features their “As Seen On Pinterest” items

12. Two-Fold Mobile Strategy
Mobile Apps are quickly becoming a popular venue for engaging customers
via Social Media. There are things apps can do that a website can not, and
vice versa. A successful brand will utilize both.
• apps create a feature-rich enjoyable user experience that people like
spending time on and come back to.
• websites are accessible from any device
• Mobile web reaches a larger consumer pool
• apps are more useful for brands looking to reach their target audience
Adhami, Melody 2013

13. Blog Marketing“The bloggers have moved from commentators to creators; gone
from front row next to Anna Wintour, to backstage next to Alber
Elbaz in but one calendar year.”
-Global Luxury Trends
Ross, Elspeth 2013
bloggers create a different
bond with the consumer
than a journalist or marketer
does
bloggers emulate styles
and trends while also
making them personal and
exclusive
Bloggers reach a younger
demographic because of
their shared consumer
values

14. Shea, Erin 2013
Print Advertisement“Print remains an effective medium for luxury because it’s
something we can hold, touch, and remember.”- Erin Shea
• Luxury Ads that stand out are the ones that
put the focus on the product and not the
imagery, people, or attitude
• engaging visuals create emotions in
consumers, marketers should aim at making
ads that encourage emotional impulse
• Ralph Lauren Spring/Summer Print Campaign
• Marketers have not ditched print
advertisement for others with low cost
because they have not found a medium that
matches the print experience.

15. “Maintaining brand desirability is
particularly important at a time when growth
is lower and consumers have wider choice in
an increasingly crowded luxury market.”-
Business of Fashion, 2015
RiskofOverExposure
Rarity and Exclusivity are defining
characteristics of Luxury. Brands that lose
those aspects essential lose the essence of
luxury.
Thereissuchathingastoomuchandtomany…

16. im
portantto
have
innovative
m
anagem
ent,“D
esign
Thinking”
Rise in technology and social
media creates more unique
opportunities for brands to
separate themselves from
their
competition
Marketing is a controlling factor in
consumer engagement and
competitive advantage
Use
ofCRM
tools:
incorporate
various
strategies
in
orderto
learn
m
ore
aboutyourtarget
consum
erand
theirloyalties
Setting yourself
apart
from the
competition

17. E-‐Commerce
To be successful, you must master the 3 C’s: COMMERCE, CONTENT ,COMMUNITY
Shock of the New Chic 2014
“For luxury brands, as for every other type of business, the digital
domain is here to stay.”
Brands need to
focus on merging
the concepts of
online and offline
retail, with a hybrid
business
organization model
Brands with an
established e-
commerce site in
the US and Europe
are seeing
10%-20% of retail
sales come from
online.
Brands need to
focus on merging
the concepts of
online and offline
retail, with a hybrid
business
organization model

18. Does Technology Belong in-store?
companies that
incorporate
technology in
other aspects
of their
experience,
they should
also include
it in the
retail
experience
Carr, Tricia 2013
“Department stores and boutiques are where luxury
marketers can present collections in a physical, traditional
sense, but technology should be added in some instances to
show brand innovation.”-Tricia Carr
If the technology is enhancing the customer
experience, then it is adding value to the
traditional retail set up.
Sales
associates can
utilize
technology to
increase
service and
personal
recommendations

19. Emerging Markets
“Our prospects would look grim without China and the
other fast emerging economies”- Guy Salter, China Luxury
Summit 2011
• Newly affluent customers have a big appetite for luxury products
• These consumers with recently acquired wealth are concentrate in
specific regions of emerging markets and their demographic is much
less diverse than that of the US
There is large opportunity for growth for companies who can
successfully read the consumer of these growing markets and meet their
specific needs.
China India Russia Brazil

20. How Emerging Markets
Impact the Luxury Industry
The emergence of new markets has a direct affect on the success
of individual luxury segments. This was evident in 2014 industry
growth statistics, particularly transportation luxury
Bain & Company’s 2014 Annual Global Luxury Study states:

21. New Business
Strategies
shock of new chic, 2014
Luxury brands are
moving away from
“luxury islands” and
creating more
relationships within
the brand and with
outside
organizations.
More data is
available with the
use of CRM tools
which creates a
stronger
communication tie
between brands and
retailers
adjustments to
verticalization
strategies conveys a
sense of exceptionally
high standards to
newcomers and
creates a strong
competitive
advantage.

22. • The shift in office atmosphere and
wardrobe requirements in the work
place has men shopping for more
casual work attire.
• Men are beginning to care more about
their personal appearance and are
attracted to more fashion choices
• “data from Euromonitor, which shows a
4.1 percent decrease in suit sales
between 1999 and 2000, and a further
decline of 21.2 percent between 2000
and 2001.”
• millennial are also credited for created
an increased interest in being
fashionable
“Menaissance"
• department stores are
expanding their mens
departments
• working on customer service
initiatives to encourage men
to shop more
Men today shop for the casual alternative to the suit…
retailers are having to adapt to the growing demand of menswear…
“Even in large Western fashion markets, such as the US, the UK and Germany, the sales of
menswear has been growing at a faster pace than womenswear for the past few years.”

23. TOURISM
Tourism is a great source of income for many luxury companies, especially
transportation and experiential luxuries. However, consumers making
luxury purchases while traveling can affect the growth of their own market.
• certain nationalities are more
likely to spend while traveling
• Chinese tourists
spend three times
more money
abroad than they
would at home
• focusing on certain luxury
cities requires more specific
marketing to account for
cultural/personal tendencies
Think Advisor

24. The Talent GapSocial Media and
digital media on
the rise as a
strategy for
finding top
employees
BCG Minding the Talent Gap, 2014
Many Luxury companies are struggling with finding talent. With the
growth of technologies, there is a strong need for employees who can
successfully combine creative and organizational strategies.
BCG research
shows that
companies with
superior hiring
and better
retention rates
show more
economic benefits
Four Key Areas of
Concern:
Recruiting
Strong Leadership
Employer Brand
Digital Technology

25. Currency/Market Changes
many customers buy luxury as long term
investments, drops in price stability cause
them to question the value and exclusivity
Paton, Elizabeth 2015
“We need price equilibrium around the world,”
Jean-Claude Biver, president of LVMH’s watch and
jewelry division
Currency changes cause
inflation in
manufacturing costs and
inconsistent pricing in
different sales regions
The difference in luxury bags/
watches/jewelry between Europe
and China is the largest it has
been in 3 years according to
Sanford Bernstein Research
Company
The instability of the Euro affects a
majority of luxury companies

26. Off-ChannelLuxury
Balancing act
between good
exposure and over-
exposure
Luxury Daily
discount and outlet stores
help brands reach a
wider variety of
consumers but hurt the
company’s luxury image
if done strategically, outlets can be
beneficial to luxury department stores,
but at what cost to the brands they
carry?
Must maintain brand
status and prevent
outlets from
distracting from core
products
strategic way to engage an
aspirational consumer
Luxurybrandsopeningoutletandfactorystores

27. Graduate student pursuing a dual Masters in Global Luxury Management. Experience in customer
service, sales, education, and team building. Detail oriented and well organized, punctual, and
responsible. Known for ability to maintain and strengthen communication within company
departments and creating strategies to encourage customer satisfaction and generate sales. Focused
on using educational experience to develop the tools necessary for a career in Management. Seeking
a position in Marketing/Public Relations within a global luxury company.
CarolAnneHenry

28. In my undergraduate studies, as well as my first year in the
“real world”, I was a teacher. Being in the Global Luxury
Program seems a far stretch, but there are many things I
learned and was required to do as a teacher that are very
relevant to the business world. Managing the schedules of 24
students, daily. Incorporating your daily schedule into a
larger, year-long curriculum schedule. Planning enough
course work for 24 students, for every day. Making the
required course work seem entertaining to 8 year-olds (a
challenge). Collecting data from their studies and using that
data to make positive changes. But most of all, making sure
that your class is a cohesive team and that one member is
never left behind. Being a teacher has allowed to develop
great communications skills. It helped me acquire
organization and time management skills. Most importantly,
it allowed me the opportunity to experience what it is like to
work with many different types of people.
Why Luxury?
I chose to pursue luxury because of all that luxury encompasses. To me, a luxury product is a piece of art. It
is the idea that at some point, that item was someone’s dream. Knowing that the pair of jeans you are
wearing took 36 hours to create, from choosing the fabric to stitching the pattern by hand. With luxury, the
idea is quality from the time of conception until the moment the consumer puts it away at home. A general,
mass produced item lacks that element of inspiration. The jeans I buy from an average retailer only reminds
me of the machine that took 36 seconds to create them. I choose luxury because I choose to encourage and
hopefully influence an industry that brings art into all facets of production.
From Lunchboxes
to Luxury

29. Dream JobDigital Marketing
Dream Companies
Public Relations
Interested in: Personal Luxury Sector

30. Works Cited
Abtan, Olivier, Antonio Achille, Jean-Marc Bellaiche, Youllee Kim, Vincent Lui, Amitabh Mall, Antonella Mei-Pochtler, and
Sarah Willersdorf. <i>Shock of the New Chic</i>. Rep. N.p.: Boston Consulting Group, 2014. Print.
Adhami, Melody. "Why Luxury Brands Need Two-Fold Mobile Strategy." <i>Luxury Daily Classic Guide to Luxury
Marketing</i> (2013): 11-12. Web.
Anaya, Suleman. "Has Logo Fatigue Reached a Tipping Point?" The Business of Fashion. N.p., 11 Mar. 2013. Web. 01 Sept.
2015.
"Bain & Company's 2014 Annual Global Luxury Study Proclaims the Rise of the Consumer as Luxury Markets Settle in for
Lower, but More Sustainable Long-term Growth." - Bain & Company. Bain and Company, 14 Oct. 2014. Web. 01 Sept. 2015.
Carr, Tricia. "Does Technology Belong In Store?" <i>Luxury Daily Classic Guide to Luxury Marketing</i> (2013): 4-5.
Print.
"Global Luxury Goods Market Expected to Sustain Steady Momentum with 2-4 Percent Real Growth in 2015." Spring 2015
Worldwide Luxury Goods Update. Bain and Company, 21 May 2015. Web. 03 Sept. 2015.
Paton, Elizabeth. "Currency Swings Create Inequalities for Buyers in the Luxury Market - FT.com." Financial Times. N.p., 8
June 2015. Web. 01 Sept. 2015.
Ross, Elspeth. "Why Smart Luxury Brands Embrace Bloggers." <i>Luxury Daily Classic Guide to Luxury Marketing</i>
(2013): 26-27. Print.
"7 Pressures and Effects on Global Luxury Market." 7 Pressures and Effects on Global Luxury Market. N.p., 16 Apr. 2015.
Web. 01 Sept. 2015.
Shea, Erin. "Luxury Brands Must Maintain Status When Opening Outlet Stores." Luxury Daily RSS. N.p., 18 July 2013. Web.
03 Sept. 2015.
Shea, Erin. "Print Advertisement Should Position Product as Hero." <i>Luxury Daily Classic Guide to Luxury Marketing</i>
(2013): 6-7. Print.
Sozzani, Franca. "What Is the Meaning of Luxury?" - Vogue.it. Italian Vogue, 5 Mar. 2011. Web. 01 Sept. 2015.
Sulca, Luca. "Top 10 Risks for the Luxury Industry." The Business of Fashion. Business of Fashion, 09 Feb. 2015. Web. 01
Sept. 2015.
Willersdorf, Sarah, Olivier Abtan, and Thomas Gaissmaier. <i>Minding the Talent Gap</i>. Rep. N.p.: Boston Consulting
Group, 2014. Print.