Saturday, November 01, 2008

2 for 3 or 2 for 1?

"Two for the price of three". Sounds absurd? Perhaps you mentally translated it as "Two for the price of one" which is a far more common phrase. But 2 for 3 describes luxury branding at its simplest. The additional value is intangible - trust, pride, reliability. Intangible, but valuable. to the consumer.

You may be wondering why I am discussing luxury brands when the economy is pinching even these creamy layer products. (Though the really, really rich may decide that it's a good time to splurge on a second slightly-used mega-yacht for the family!) Well, that's because I think the philosophy of luxury brands - the personalization, reliability, predictability - can be replicated even for brands that aspire to address a broader audience. Everyone wants to be special.

I recently attended a case-study based training program organized by Dominion which had Professor David Bell from Harvard Business School speak on Strategic Marketing. It was more tuned towards products, but there was one big take-away for me - you are loyal to brands you are grateful to. And you are grateful to brands that deliver more than you expect or do something for you. For example, he cited the example of alumni contributing to their alma maters because they were grateful for what the education (or brand stamp) had done for their careers. I remember certain restaurants and coffee shops not because of what they sell but because of what they give free with the food. If a retailer takes back stuff even if you have lost the bill, you are grateful to them. Using a Mont Blanc pen renders a certain cache to the writer - you are grateful to the brand for establishing your credentials. Ditto luxury cars or green products or alternative clothing brands or where you live.

I think this is what lies at the heart of all classy brands, lux or otherwise. Going beyond the ordinary and baking that into the customer experience in a sustainable, scaleable way. And loyalty is a good thing to have when the world is uncertain.

PS: I have my husband to thank for the phrase "2 for 3"


Mukund Mohan said...

Leaving a lasting impression is very difficult for a relatively low margin business like Grocery. So they focus on "value" and "convenience". The appeal of a 2 for 1 at the lower end of the food chain translates to "got a deal" I think.

How was the overall training program BTW?

Jessie Paul said...

Mukund - 10 years ago I used to handle a Unilever brand of tea called Super Dust. Not a premium brand in the HLL hierarchy. It was sold in 50 paise (1 cent) sachets in rural areas. While this seemed cheap to us, there were even lower cost unbranded or pirated options available. Yet, some people opted, deliberately, to indulge in this relatively expensive tea. It was their one affordable luxury.

The training program was across 2 days. I found it useful - long time since I took an academic look at marketing! I liked Prof Bell's ABCD model.

manuscrypts said...

agree, though value and its tangibility can be very subjective too.. in fact (this is subjective, but not luxury) i also prefer one outlet of a brand over another for what'd be classified as intangibles.. but the cynic in me says the lessons of decent customer service has to be learnt first :|

manuscrypts said...

here's a good tangential read

Jessie Paul said...

Manu - completely agree - luxury is relative. At each price point there is one brand considered luxury. I read the other piece. It is logical that brands do something to you as otherwise you wouldn't spend extra. women feel prettier with an expensive perfume - I write this from Heathrow where such irrational behavior is fuelled by the many duty free outlets!