October 23, 2014
Written by Liu Xue Fei
Before the appearance of Web, business organizations always attracted their customers in two traditional rules: pay a lot of money on advertising or cooperate with a third-party from the media (Scott, 2013). With the development of Internet, communication became more easy and convenient. Some marketers also found their new opportunities and broke the traditional rules. The Internet and electronic commerce turned into a strategic necessity for business organizations (Al-Mashari). As Bemard Martin stated, 'traditional marketing involves talking at someone. Social media marketing involves talking with someone' (Atkinson, 2013).A one-way interruption marketing could not adapt current market conditions and understand customers' need, so some firms start to choose social media marketing instead. According to Akar and Topsu (2013), social media marketing could be defined as a company use social media channels in order to promote itself; the social media channels include social networking sites, cooperative projects, blogs, content communities, virtual social worlds, virtual game worlds and microblogging. If companies ignore social media as their online marketing strategy, they may lose an opportunity to reach potential customers (Kim and Ko, 2012). However, it is hard say that the social media marketing suit for every kind of industries or companies.
Luxury brand industry's product or service is different with commodity or normal industry, luxury Brand also could be seen as a symbolic, imaginary or social added value (Geerts, 2013). Nueno and Quelch (1998) defined luxury brand as that being at the top of the pyramid, which depends on products functional utility, price and the socio-demographic characteristics. In addition, luxury brands have specific features: uniqueness and exclusivity (Jin, 2012). While luxury brands choose social media marketing, their managers will face 'a dialectical tension between the need to keep up with the social media trend and the need to maintain their brand integrity and exclusive reputation'(Jin, 2012). Hence, the luxury brands managers need to consider a lot to decided in order to avoid or decrease the tension. This paper aims to find out whether social media marketing fit for the luxury brands.
Social Media Marketing and Social media
Social media marketing is a process that companies present their own products or services through online social media channels, in order to communicate in a wide community (Akar and Topsu, 2013). Comparing with brand generated traditional marketing, social media marketing consist of three characteristics: multidirectional dialogs, participatory and user generated. Conversation is one of the core views in social media marketing, customers could generate, edit and share online information about company, and also create online communities and networks through social media platforms (Akar and Topsu, 2013), in another word, companies could communicate with customers or buyers directly (Scott, 2013).
Social media is the tool that social media marketing used to increase companies' visibility on the Internet, and social media conducive to establish social networks and information exchanging (Ontario 2008). In addition, using social media of brands also reduced misunderstanding and prejudice toward brands, and elevate brands value, because of the more directly communication between brands and customers(Kim and Ko, 2012). Kim and Ko (2012) mentioned that social media aims to facilitate interaction, collaboration and sharing of content, and it has different forms, for example: social blog, wikis, podcast, picture, video, social bookmarking and etc. Corcoran (2009) divided the ecosystem into three media types: owned media, paid media and earned media. Owned media is the one that could be controlled by companies; paid media is the one that companies need to buy from others; the media that companies cannot control or buy is earned media.
Online groups or virtual groups are formed by social media or social network. In this on-line groups, people share information and trust each others, word-of-mouth principles are stronger in this virtual world than real world (Papasolomou and Melanthiou, 2013). As the statistics (DEI Worldwide, 2008) offered, almost half of customer searched for information via social media sites engaged in word-of-mouth. word-of-mouth is quite important in social media marketing, because the social media could affect brand's reputation(Kim and Ko, 2012).
Social Media and Luxury Brand
Although luxury brand industry was already success in 2010, it still need a growing necessity to ensure supplement income sources: combining luxury and the Internet (Geerts, 2013). Most luxury brands have its social media sites today, such as: Facebook and Twitter(Phan,2011). While luxury brands using social media to directly contact with its customers, they could create new products, service, business model and values together. Luxury brands also can gain more information and strengthen relationship with customers at the same time (Kim and Ko, 2012). However, customer also could use social media as a complaint forum to express negative or unsatisfactory comments (Jin, 2012).
'Young' is the word which belongs to both luxury brand and social media. Depending on Phan's (2011) survey, he found out that 'social media is extremely popular especially among the young adults who have actually grown up with the new communication technologies that are also progressively very intuitive and user-friendly which in turn increases their popularity'. Young customers are also the fastest growing segment of the luxury market who always desired fashion-driven products (Juggessur and Cohen, 2009). Hence, social media and luxury brands have quite similar target customers.
Functional and economic value of products or services are the factors that customers always consider about, but a luxury brand is 'a premium priced brand purchased by consumers for their psychological values' (Nueno and Quelch, 1998), it owns hedonic and symbolic goods. According to Dellarocas et al. (2007) and Smith et al. (2005) research, consumers prefer recommendations from other consumers rather than critics from professional reviews, especially for hedonic goods.
Cases and Discussion
The luxury brand Burberry was founded by a 21 years old dressmaker Thomas Burberry in 1856. The target customers of Burberry are the high-incomes young people, the average age is 18-35. Burberry is one of the earliest luxury brand choose social media marketing, it has accounts on mass popular social network website, for example: Linkedin, Twitter, Facebook, Google+, Instagram, Youtube and etc (Austin Powe,2013) . Now, Burberry has over 16million Likes on Facebook and continually increased. In November 2009, Burberry launched an on-line project with Facebook called 'Art of the Trench'. This project launched as a Trench coat photo-sharing website, everyone who has a Facebook account could share the wearing Trench photo on 'Artofthetrench.com'. Besides, users also free to make comments or add Likes on other one's photo (Ortved, 2011). Trench project aimed to elicit admiration for the design of their trench coats and create more Burberry fans (Samsung Design Net, 2009). After this project, Burberry's online sales increased, it also earned more fans and good reputation. In 2012, Burberry decided to publish their new product on Twitter and Instagram in advanced, and also put its new conference Live on Youtube. After this promotion through social network, the amount of 'Likes' on these three social website rapidly increased (Xiao, 2012). Burberry's profit also increased, after it working through the mass social media marketing. Combining the Burberry case with theories, it is easy to find out that Burberry is well communicated with its customers through the Trench project. Burberry could observe or directly communicate with its customers in order to know their needs. No matter positive or negative comments that customers made, Burberry could discover them in time and made suitable changes. In addition, Burberry's target customers test ' young' theory again. Both social media and luxury brands target customers are young adult, Burberry's target customer is 18-35 which just fit to the theory. Moreover, according to Dellarocas et al. (2007) and Smith et al. (2005) research, consumers prefer recommendations from other consumers rather than critics from professional reviews. Burberry build the social media site provide a public place to customers, customer could gather in to on-line group by themselves. The recommendation of others will affect customer's decision making which is more convincing.
When other luxury brands still insist of using the traditional marketing, Burberry taken a courage step. Social media marketing helped Burberry to earn more customer and good reputation. The conditions provided by social media marketing which just satisfied luxury brand's promotion needs and motivated luxury brand's development. The social media marketing is fit for the luxury brands. However, luxury brands is still a high-ended and expensive brand, even though it promoted through social media network to common, how many customers could carry the price? And how to keep the luxury brand uniqueness and exclusivity while promoted it too popularization and frequently?
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