Luxury has been one of the fastest-growing sectors over the past two decades, with the total brand value of top fashion houses increasing sixfold in Kantar BrandZ’s rankings. These fashion houses enjoy some of the richest heritages in branding, with the average brand in the Kantar BrandZ Global Luxury Top 10 boasting a 132-year history.
Because of this longevity, luxury brands offer a great lesson on how to remain relevant despite shifting markets. These brands have stood the test of time, but they have also changed with the times. They have taken agile steps to refresh their relevance and protect their bottom lines in the face of unpredictable market conditions.
And, they have done this all while preserving the strong foundations of their brand identities. Indeed, it is these very same brand fundamentals that have enabled luxury brands to evolve so smartly.
These qualities are being Meaningful, Different and Salient (MDS). In the luxury sector, MDS is what underpins brands’ reputations as timeless icons. It is also what fuels these brands’ successes as timely, cultural influencers.
Marketers have long known that it’s important to be Salient i.e. to come to mind quickly. The other two brand equity building blocks are less understood, even though, in a way, they’re more fundamental to success.
Being Meaningful to people involves meeting their functional needs, in whatever category context that might be, but it also means connecting emotionally with people.
Being Different is about standing apart from other options in the category and leading the way when it comes to trends and innovation.
Once brands have established these two important qualities, they can then use marketing communications to strengthen their Salience and amplify any messages they want people to know about their brand.
Looking back to the first Kantar BrandZ rankings from 2006, we see that those brands with strong Meaningful Difference were twice as likely to stay in the rankings 20 years later. Not surprisingly, this select group includes some major luxury powerhouses.
One key way that Meaningful Difference drives brand value is by supporting margins. These days, reaching large audiences is not enough. Strong brands must also deliver a value proposition that more than justifies their target margins. Ultimately, this means building clear, memorable perceptions that leave people feeling that a brand is worth it.
This ability to support prices, known as Pricing Power, has helped brands withstand shifts in the marketing landscape. It will be critical in the uncertain years ahead.
Supporting margins has become particularly important in the luxury sector considering how brands have increased prices by as much as 59% this decade. The determining factor in this category-wide push ‘upmarket’ has been whether or not shoppers think a brand is worth its new price point.
Chanel is truly one to learn from. For over a hundred years, Chanel has built Meaningful connections with audiences around the globe. While its heritage traces back to Coco Chanel’s pioneering vision for the modern woman, these days its reach extends far beyond ‘the little black dress’.
Chanel has positioned itself as an integral part of culture, with an influence that stretches across film, art, literature and music. Since the 1980s, one of Chanel’s greatest strengths has been its memorable advertising, as realised by cinematic luminaries like Joe Wright, Baz Luhrmann and Ridley Scott.
Just as importantly, Chanel’s cultural cachet has created countless informal testimonials to the brand’s Meaningful Difference – perhaps none more famous than when Marilyn Monroe told an interviewer that the only thing she wore to bed was ‘five drops of Chanel N°5. In 2013, Chanel made the Marilyn link official by posthumously appointing her as a face of the perfume – a cultural tie-in that the brand revived last year.
Just as important is adapting to the needs of different markets. Chanel maintains its Meaningfully Different positioning around the world, but tailors its strategy to appeal to local audiences. In China, Chanel’s show in Hangzhou incorporated traditional motifs alongside its signature Parisian elegance. It did so authentically, by using Coco Chanel’s collection of Chinese Coromandel lacquer screens as the heritage link between East and West. Chanel has also introduced lighter versions of Chanel N°5 to appeal to Asian consumers’ preference for more delicate scents.
Another example is Dom Perignon, which has built its Difference amongst champagne buyers through earned exclusivity (as opposed to exclusivity for exclusivity’s sake). It produces only vintage champagne, and will not release any products if conditions are not optimal. That shows an unwavering commitment to quality and core identity. At the same time, the brand is not afraid to explore new facets of that identity, as in the case of a 2021 collaboration with Lady Gaga that has found surprising new ways to reiterate Dom Perignon’s brand values of creativity, dedication and craft.
Rolex’s Meaningful Difference, for instance, relates to precision and expertise, which the brand highlights through partnerships with athletes and sporting events (especially tennis, golf, motorsports and equestrian sports). Prada’s Meaningful Difference reflects the brand’s innovative spirit, as expressed this decade by its Re-Nylon sustainability initiative.
Consistent positioning matters, and a brand’s Meaningful Difference should be central to its marketing strategy, but these qualities are not static ideas. The stories brands tell in order to build Meaningful Difference should change authentically over time. In fact, this is essential to maintaining cultural relevance over the long term.
1. Understand what consumers want from you. Invest the time and resource to identify the things that matter to buyers in your category and how you can best meet these needs
2. Find your competitive edge. Recognise what can you offer that others do not, in terms of product, experience or association
3. Consistently amplify these qualities. Reinforce key associations at every opportunity, across communications, purchasing opportunities and activations.
Find more data-driven insights in the 20th anniversary edition of Kantar BrandZ’s Most Valuable Global Brands report now available at www.kantar.com/campaigns/brandz/global
For a quick read on a brand’s performance compared to competitors in a specific category, Kantar’s free interactive tool, BrandSnapshot powered by BrandZ, provides intelligence on 15,000 brands. Find out more here.
Because of this longevity, luxury brands offer a great lesson on how to remain relevant despite shifting markets. These brands have stood the test of time, but they have also changed with the times. They have taken agile steps to refresh their relevance and protect their bottom lines in the face of unpredictable market conditions.
And, they have done this all while preserving the strong foundations of their brand identities. Indeed, it is these very same brand fundamentals that have enabled luxury brands to evolve so smartly.
Meaningful Difference: The strategic growth driver
Kantar is able to quantify and measure the qualities that make strong brands. While allowing that every category markets itself differently, we have found the same core qualities drive success in any sector.These qualities are being Meaningful, Different and Salient (MDS). In the luxury sector, MDS is what underpins brands’ reputations as timeless icons. It is also what fuels these brands’ successes as timely, cultural influencers.
Marketers have long known that it’s important to be Salient i.e. to come to mind quickly. The other two brand equity building blocks are less understood, even though, in a way, they’re more fundamental to success.
Being Meaningful to people involves meeting their functional needs, in whatever category context that might be, but it also means connecting emotionally with people.
Being Different is about standing apart from other options in the category and leading the way when it comes to trends and innovation.
Once brands have established these two important qualities, they can then use marketing communications to strengthen their Salience and amplify any messages they want people to know about their brand.
Looking back to the first Kantar BrandZ rankings from 2006, we see that those brands with strong Meaningful Difference were twice as likely to stay in the rankings 20 years later. Not surprisingly, this select group includes some major luxury powerhouses.
One key way that Meaningful Difference drives brand value is by supporting margins. These days, reaching large audiences is not enough. Strong brands must also deliver a value proposition that more than justifies their target margins. Ultimately, this means building clear, memorable perceptions that leave people feeling that a brand is worth it.
This ability to support prices, known as Pricing Power, has helped brands withstand shifts in the marketing landscape. It will be critical in the uncertain years ahead.
Supporting margins has become particularly important in the luxury sector considering how brands have increased prices by as much as 59% this decade. The determining factor in this category-wide push ‘upmarket’ has been whether or not shoppers think a brand is worth its new price point.
Brand building in action
Meaningful Difference is critical for growth, but how do brands actually build it?Chanel is truly one to learn from. For over a hundred years, Chanel has built Meaningful connections with audiences around the globe. While its heritage traces back to Coco Chanel’s pioneering vision for the modern woman, these days its reach extends far beyond ‘the little black dress’.
Chanel has positioned itself as an integral part of culture, with an influence that stretches across film, art, literature and music. Since the 1980s, one of Chanel’s greatest strengths has been its memorable advertising, as realised by cinematic luminaries like Joe Wright, Baz Luhrmann and Ridley Scott.
Just as importantly, Chanel’s cultural cachet has created countless informal testimonials to the brand’s Meaningful Difference – perhaps none more famous than when Marilyn Monroe told an interviewer that the only thing she wore to bed was ‘five drops of Chanel N°5. In 2013, Chanel made the Marilyn link official by posthumously appointing her as a face of the perfume – a cultural tie-in that the brand revived last year.
Just as important is adapting to the needs of different markets. Chanel maintains its Meaningfully Different positioning around the world, but tailors its strategy to appeal to local audiences. In China, Chanel’s show in Hangzhou incorporated traditional motifs alongside its signature Parisian elegance. It did so authentically, by using Coco Chanel’s collection of Chinese Coromandel lacquer screens as the heritage link between East and West. Chanel has also introduced lighter versions of Chanel N°5 to appeal to Asian consumers’ preference for more delicate scents.
Another example is Dom Perignon, which has built its Difference amongst champagne buyers through earned exclusivity (as opposed to exclusivity for exclusivity’s sake). It produces only vintage champagne, and will not release any products if conditions are not optimal. That shows an unwavering commitment to quality and core identity. At the same time, the brand is not afraid to explore new facets of that identity, as in the case of a 2021 collaboration with Lady Gaga that has found surprising new ways to reiterate Dom Perignon’s brand values of creativity, dedication and craft.
Marketing levers that matter
As mentioned earlier, the specific drivers of Meaningful Difference differ by category, shaped by what buyers in each category truly value for the occasions that matter most to them. In luxury, quality perceptions are paramount, but rarely in isolation. Associations around provenance, sustainability and craftsmanship all come into play too.Rolex’s Meaningful Difference, for instance, relates to precision and expertise, which the brand highlights through partnerships with athletes and sporting events (especially tennis, golf, motorsports and equestrian sports). Prada’s Meaningful Difference reflects the brand’s innovative spirit, as expressed this decade by its Re-Nylon sustainability initiative.
Consistent positioning matters, and a brand’s Meaningful Difference should be central to its marketing strategy, but these qualities are not static ideas. The stories brands tell in order to build Meaningful Difference should change authentically over time. In fact, this is essential to maintaining cultural relevance over the long term.
What can we learn from luxury brands?
To summarise, as the luxury category shows, Meaningful Difference allows a brand to endure as both a timeless and timely presence in people’s lives. When developing your brand’s strategy, remember these principles:1. Understand what consumers want from you. Invest the time and resource to identify the things that matter to buyers in your category and how you can best meet these needs
2. Find your competitive edge. Recognise what can you offer that others do not, in terms of product, experience or association
3. Consistently amplify these qualities. Reinforce key associations at every opportunity, across communications, purchasing opportunities and activations.
Find more data-driven insights in the 20th anniversary edition of Kantar BrandZ’s Most Valuable Global Brands report now available at www.kantar.com/campaigns/brandz/global
For a quick read on a brand’s performance compared to competitors in a specific category, Kantar’s free interactive tool, BrandSnapshot powered by BrandZ, provides intelligence on 15,000 brands. Find out more here.
