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Beyond rarity: the paths of luxury desire. How luxury brands grow yet remain
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DOI: 10.1108/JPBM-09-2015-0988
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Journal of Product & Brand Management
Beyond rarity: the paths of luxury desire. How luxury brands grow yet remain desirable
Jean-Noël Kapferer Pierre Valette-Florence
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Jean-Noël Kapferer Pierre Valette-Florence , (2016),"Beyond rarity: the paths of luxury desire. How luxury brands grow yet
remain desirable", Journal of Product & Brand Management, Vol. 25 Iss 2 pp. 120 - 133
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(2016),"Brand constellations: reflections of the emotional self", Journal of Product & Brand Management, Vol. 25 Iss 2 pp.
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(2015),"Luxury branding: the industry, trends, and future conceptualisations", Asia Pacific Journal of Marketing and Logistics,
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Beyond rarity: the paths of luxury desire.
How luxury brands grow yet remain desirable
Jean-Noël Kapferer
INSEEC, Paris, France, and
Pierre Valette-Florence
Downloaded by HEC Paris At 15:20 10 May 2016 (PT)
IAE Grenoble, Grenoble, France
Abstract
Purpose – Luxury is a growing sector worldwide. This creates a major managerial challenge: How can luxury brands prevent becoming a victim of
their own success? Once objective rarity is lost, what other levers still sustain desire for these luxury brands, nurture their dream and, thus, prevent
the dilution of desirability created by their growing penetration and sales?
Design/methodology/approach – Based on 1,286 actual luxury consumers interviewed about 12 highly known and successful luxury brands on
42 experiential and perceptual items, a PLS hierarchical fourth-order latent variables model unveils the paths of luxury dream building.
Findings – The authors have identified how, beyond mere physical rarity and very high quality, eight experiential and perceptual levers fuel luxury
desirability through two structural paths: selection and seduction.
Research limitations/implications – The concept of luxury is associated to rarity. But to grow, luxury brands need to abandon mere scarcity and
selectivity (value created by limitation of production, highly selective distribution and selection of customers) and switch instead to an “abundant
rarity”, where feelings of privilege are attached to the brand itself, seducing through its experiential facets, pricing, prestige and the world it
symbolizes.
Practical implications – Luxury executives can use this paper as a compass to manage, sustain and monitor their brand desirability, all along the
brand’s growth, as it moves away from being niche and rare.
Social implications – Considering the growing social diffusion of the need for luxury in different strata of the population, this paper reveals the
levers of the attractiveness of the mega-brands of luxury.
Originality/value – This paper addresses the main problem of the luxury industry: How to grow yet remain desirable. It is based on 1,286 actual
luxury buyers and 12 actual brands. Thanks to PLS modelization, the structure of the levers of brand desirability is revealed.
Keywords Brand love, Luxury, PLS modeling, Desirability, Growth, Rarity
Paper type Research paper
Introduction: the new landscape of luxury
island. Although these images come spontaneously to mind
when consumers are asked what the word luxury evokes
(IPSOS, 2014), modern luxury is very different: It is an
actively growing sector, targeting an expanded clientele.
Luxury stores now flourish in all capital cities of the world. For
an emerging country, the presence of luxury stores is the signal
of the country’s economic growth and of the emergence of a
middle class willing to access to the best that the consumer
society can offer.
If mature countries still remain the dominant luxury
markets because of their high purchasing power (USA, Japan,
Europe), then the long-term future of luxury is elsewhere in
these emerging countries. It is predicted that China could
become the Number 1 country of the luxury sector in 2020,
because of the considerable size of its middle class, wanting to
enjoy life after decades of deprivation (Bain & Company.,
2014) and who travels now outside China.
Luxury is as old as humanity, at least humanity with a social
and hierarchical organization (Berry, 1994). Historians have
analyzed the evolution of luxury through centuries and
civilizations (Castarède, 2009). Today’s rising global appetite
for luxury, far beyond the limited circle of riches and
powerfuls, attracted the attention of scholars from all
disciplines. Interest among business academics has also
grown, as luxury is a thriving economic sector, with prominent
brands, reputed companies, concentrated groups, some of
them gone public to finance their international retail
expansion (LVMH, Kering, Prada, Hermès, etc.).
Luxury started as a niche, limited to the happy few, the only
ones who could afford it. At the turn of the past century, few
people had an automobile, just as very few consumers today
fly in private jets or own a yacht or maintain a Caribbean
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Luxury: experience versus essence
Despite the ubiquitous visibility of luxury brands and luxury
malls in capital cities of the world, the question “what is
luxury?” is still debated among academics. Not only are there
as many definitions as researchers but also these definitions
changed through time (Yeoman, 2011; Yeoman and Mc
Mahon-Beattie, 2010). Many scales have been proposed to
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25/2 (2016) 120 –133
© Emerald Group Publishing Limited [ISSN 1061-0421]
[DOI 10.1108/JPBM-09-2015-0988]
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Volume 25 · Number 2 · 2016 · 120 –133
identify what factors underlie the luxury concept (Kapferer,
1998; Vigneron and Johnson, 1999; Dubois et al, 2001;
Beverland, 2005; Wiedmann et al., 2012). However, this
abundance of scales has not helped in understanding the
steady growth of the luxury sector.
The essence of luxury may still be elusive, yet its existence
is clear for all consumers. Survey research institutes
consistently show that the pantheon of luxury brands is indeed
a small club: When interviewees are asked what brands they
hold as best exemplars of luxury, the same names appear all
around the world (Vuitton, Chanel, Rolex, Ferrari, Gucci,
Tiffany, Prada [. . .]) (IPSOS, 2014). This is normal: When it
comes to the market, luxury is not a “concept” but a reality
incarnated by brands and their magnificent stores
concentrated on high street. Those malls of Seoul, Taipei or
Shanghai calling themselves “luxury malls” tell what brands
are the “luxury brands”. This shapes the new consumers’
vision of what luxury is. This is why brands are at the core of
luxury today. Debates about the definition of luxury may
continue among scholars, yet the ubiquitous existence of the
same luxury brands, luxury products, luxury malls and
communications across countries creates a quite
homogeneous consumer experience and, hence, vision.
Paternault, 1995)? Our objective is not to propose another
definition of luxury or to decree which brands are – or are
not – luxury brands but to address the demand of the
managers of these best-selling luxury brands: They want to
know what are the levers of the desire today for their brands,
beyond rarity, on which they need to capitalize. How to
compensate the loss of rarity and the diluting effects of the
higher penetration resulting from their growth made through
sales of accessories and second lines, more accessible. The
luxury managers require a grid to diagnose on which pillars
rest the sustained desirability of their brands.
To answer, we deliberately focused our research on a
sample of 12 well-known successful luxury brands, whose
stores are everywhere in the world and whose growth seems to
have no limits. Based on answers from 1,286 luxury buyers,
thanks to the access to a major French “affluent panel”, we
investigate the drivers of the sustained desire of these brands.
Unlike other studies about luxury brands, we position our
questions at the consumers’ experiential level (what luxury
consumers see, hear, feel and experience at contact points with
the luxury brands’ marketing and communication mix). To
sustain their brands’ desirability, luxury executives need to
know what operational levers they should use, by means of the
product range, pricing, specific distribution channels and store
experiences, as well as communication, including digital. This
defines the purpose of the present research: To answer, we
shall test a luxury brand building model, both integrated and
multidimensional. We identify eight operational levers which
must be implemented by the luxury brands if they wish to be
held as luxury by consumers and refuel their dream potential.
Through a fourth-order latent variables PLS confirmatory
factor analysis framework, we show how these factors combine
together and construct several paths of desirability of luxury
brands today.
In what follows, our theoretical framework, we first address
the issue of how luxury creates value. We then turn to the
research objectives and methodology section. Results are,
thus, discussed and managerial, as well as theoretical,
implications drawn. Finally, the authors acknowledge the
limitations of the study and outline future research avenues.
The dilemma of ever-growing luxury brands
To grow, with the exception of very few (Romanée Conti
wine, Ferrari or Rolls-Royce automobiles, boutique hotels
with very few rooms,) luxury brands have had no choice but to
abandon product and ingredients rarity as the precondition of
luxury and adopted “abundant rarity” strategies (Kapferer,
2012) characterized by feelings of exclusivity more than actual
exclusivity and by artificial rarity tactics (limited editions,
capsule collections). This is also why luxury brands have
changed the focus of their investments, moving from
production to the creation of memorable retail experiences, to
personalized services and to attaching symbolic capital and
prestige to the brand name itself through communication,
social influence, social networks, celebrities, brand
ambassadors [. . .] Because these investments are very
demanding, many independent luxury brands have now
joined concentrated luxury groups (Kapferer and Tabatoni,
2011): Gucci, Bottega Veneta, Bulgari, Loro Piana, etc., are
recent typical cases.
Thus, the growth of the luxury sector beyond the small
niche of high net worth individuals not only has been a
blessing but also creates a problem: The kernel of most luxury
definitions is elitism, but today, elitism is more an image than
a reality (Thomas, 2008). Certainly, high jewelry or Rolls
Royces are rare and very expensive. But Porsche sales now
reach 225,121 in 2015. It is rumored that Rolex sells 1 million
watches per year. (As it is a family-owned company, no data
are available.) This is no more rarity. What then contributes to
the sustained desire of Rolex and its being systematically
quoted by consumers as the iconic luxury watch in the world
(IPSOS, 2014)?
The objective of the present research is to unveil the levers
sustaining the high desirability of these luxury mega-brands,
although rarity is abandoned, at least on a large section of their
offering. How can they resist the diluting effects of more
penetration on their desirability and dream (Dubois and
How luxury creates value
Luxury evokes high prices among consumers of most
countries (Godey, 2013). But the high price of luxury is of a
special kind: It can never be fully justified by a gap in product
quality or performance alone. Sheth Godin’s definition of
luxury (Godin, 2009) as “needlessly expensive” does capture
this essential facet. McKinsey estimates that the average price
of a luxury watch is 167 times that of a standard watch.
Obviously that does not mean its quality is 167 times better. In
fact, the even notion of performance does not fully apply to
luxury: Luxury redefines what quality means. Because Patek
Philippe watches are made by hand, they cannot be as precise
as industrial mass marketed quartz watches; thus, they go late
regularly. Baccarat Cristal glasses are much more fragile than
usual glasses. A Ferrari is much more unpredictable than any
Toyota or Ford.
As luxury high prices are not fully explained by functional
qualities, this means that luxury brands create value far
beyond the satisfaction derived from superior product or
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Volume 25 · Number 2 · 2016 · 120 –133
service performance or quality. Luxury price is that of the
“singularities” (Karpik and Scott, 2010) built by the
intangibles (such as heritage, tradition, history, country of
origin, association to famous clients, to an imaginary lifestyle).
It is also the price to be paid to symbolically be part of the
same closed club as these VIP’s who made the brand, thus,
gain social recognition and distinction (Veblen, 1899).
Finally, beyond wealth and status signaling (Belk, 1988), as
shown by Amaldoss and Jain (2005) it is the price high enough
to make followers, unable to follow.
Wiedman et al. (2009) proposed an integrated tri-partite
model of these key values created by luxury. They distinguish
functional, individual (luxury for self) and social values
(luxury for others). Functional values remind that unlike art,
luxury products have also to be extremely well performing.
Individual values refer to self-identity values, hedonic benefits
and liking materialism. Social values are fulfilled by luxury
conspicuousness. Wiedmann et al. (2009) added a “financial
value” to their model, but this remains awkward: Measured by
an item like “Luxury is inevitably very expensive”, this is more
a defining characteristic than a value stricto sensu.
(2005) criteria used to define a luxury wine, five are
product-based: stylistic consistencies, quality commitment,
relationship to place, unique method of production, heritage
and pedigree. Only “downplay of commercial motives”
applies more to the brand. In modern luxury, brands have
become crucial because the more one sells intangible values
beyond functional ones, the more these intangible values must
be certified: Only the fame of the brand can guarantee them.
In luxury, no one wants to buy the wrong brand. This is why
luxury business is a brand-building business: Once
established, trust, reputation and desirability can be leveraged
to expand the product base, as well as the consumer base. This
explains why luxury brands can be so largely extended:
Armani extends from clothes to hotels. These brands do not
sell function but hedonism, style, recognition and art
(Hagtvedt and Patrick, 2009).
To conclude, it is time to acknowledge that luxury is made
by brands and that luxury brands are not simply brands which
sell luxurious products, they also sell the dream attached to
their own name and the world they symbolize. The luxury
sector has grown because today, more people want a share of
this luxury dream, even exceptionally (Nueno and Quelch,
1998; Silverstein and Fiske, 2005). In the modern society,
consumption is held as a source of happiness (Baudrillard,
1998): It is normal that its most extreme production as well as
experience be held as an access to dreams, under the umbrella
of a highly desirable brand.
Luxury: the product and the brand
Among all luxury brands, according to two institutes
(Millward Brown and Interbrand), Louis Vuitton is the most
valuable in 2015: It is worth $22.250 bn and ranks 20th
among all world brands from all sectors. Are Louis Vuitton
products themselves luxurious, that is to say exclusive, unique,
rare, precious, crafted or made by hand with the noblest
ingredients? Or is the Louis Vuitton brand itself emerging as
an international icon of luxury – embodying the taste of elites
all around the world through other levers which build an
incredible desire based on virtual rarity, feelings of privilege, of
exclusivity and of symbolic association to the stars of our
world, the celebrities and their dreamed life? Today, luxury
brand building entails other paths than simply product and
service excellence and objective rarity.
For luxury executives, the above-mentioned tri-partite
model of value creation (functional, individual and social) is
partly useful. How should they relate it to their day-to-day
decisions, to the marketing mix itself, to what needs to be
implemented for this luxury brand? How to sustain the Louis
Vuitton luxury dream when scarcity is abandoned? How can
Louis Vuitton (or any other successful luxury brand) sustain
the consumers’ feelings of an exclusive purchase, highly
emotional, signal of belonging to an idealized world, when
long queues of Chinese tourists wait outside their flagship
stores everywhere in the world? These people wait to enter the
Vuitton store or the Gucci store or the Dior store. They
express first a choice of brands. In modern luxury, the brands
have accumulated a symbolic capital which does not merely
rely on the product uniqueness and preciosity but on the
desirability of the brand as a whole. Social statements are
made by wearing the logos of known brands: Social
recognition is not conveyed by a bag unless its brand is
recognized even by non-buyers.
Despite the importance of the brand, it is interesting to
remark that research on luxury often searched the
discriminant characteristics in the products themselves, much
less in the brand. For instance, among the six Beverland’s
Research objective and methodology
According to brand valuation experts, the luxury sector is the
one where brands’ financial values represent the highest
percentage of their company market value (Murphy, 1991). In
brief, the stock market expectations about Prada shares are
most dependent on the desirability of the brand Prada itself,
its symbolic capital, source of its pricing power. What are the
levers and paths of these successful luxury brands, whose
continuing growth seems limitless, once abandoned mere
product rarity? This is the focus of this research. It will help
understand how highly successful luxury brands keep their
cachet and desirability despite their growing penetration of the
market.
Because this was not their objective, the main published
luxury scales do not answer these questions. Thus, Wiedmann
et al. (2009) and Hennigs et al. (2012) focus on the tri-partite
definition of luxury value creation: functional, individual and
social. They use items such as “I place emphasis on quality
assurance over prestige”, “I derive self satisfaction from
buying luxury goods” and “It is important that others have a
high opinion of how I dress and look”. These items focus more
on individual differences than on brands themselves: They do
not help luxury executives identify what levers they should
activate to sustain their luxury brands’ dream as they grow?
Another well-known luxury scale (Dubois et al., 2001)
identifies three factors underlying luxury: distinction, elitism
and hedonism. The first factor is measured by items such as
“This is a brand to dream”, the second by “This brand
represents luxury” and the third by “It is a real pleasure to own
this brand”. Still, how should the brand managers relate these
items to the precise actions they need to undertake?
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Volume 25 · Number 2 · 2016 · 120 –133
To maximize managerial relevance, this research focuses on
the experiential level. If everybody agrees that today’s luxury
brands should deliver feelings of privilege, pleasure, exclusivity
and uniqueness (Godey, 2013), for the brands themselves,
then the operational question is how to produce these feelings?
Thus, one needs to get closer to the contact points themselves
between consumers and luxury brands.
To achieve this research goal and identify how can
successful luxury brands sustain their desirability, we
positioned the questions asked to consumers at the level of
consumers’ experience. Desire for a luxury brand is
constructed at contact with the luxury brand (through its
products, its prices, its retail distribution or social media, its
communication and its services), also with its clientele (either
real or imagined: What type of clients is said to be patronizing
the brand?). Of course it is also based on the symbolic image
propagated through the media, social networks and word of
mouth. In managerial terms, one would speak of marketing
mix or influential mix or experiential mix, all of them building
symbolic capital, source of the high singularity of the brand
and, hence, its non-comparability and desire.
A consequence is that our exploration of the levers of brand
dream and desirability will focus on concrete elements of
experience and avoid evaluative abstract words such as: magic,
unique, rare, distinctive, elitist, gratifying, pleasant,
outstanding, attractive [. . .] These words which are typically
found in many luxury perception scales are high-order
constructs, either perceptual or evaluative, giving no clue as to
how to induce them. Thus, it is commonly said that luxury
should be “rare”: But rare in what meaning? Is it in the nature
of the product ingredients? Or in the know-how? Or in the
history? Or the retail presence and experience or all five? Or is
the term “rare” just a global evaluation, close to “unique”,
somehow meaning “different from other brands”. The same
remarks could apply to words such as “attractive”, which is
indeed an aggregate evaluative judgment of a number of facets
of the brand but without specifying which ones.
●
●
For distribution, we selected items referring to the fact that
the brand is perceived as not widely distributed and that its
stores have a select atmosphere able to carry the magic of
the brand (Dion and Arnould, 2011).
For communication, we tapped whether the brand is
perceived as very much talked about in the media, creating
the buzz or is it perceived as a brand which is no more
actual. Evaluations of the communications of the brand
themselves were included (do they have class?).
As we focus on the brands, other symbolic dimensions were
also measured which have been shown to contribute to
desirability:
●
Luxury brands select their clientele (there is a relationship
between being seen as exclusive and as excluding): One
needs to measure what clientele is associated to the brand.
(Is it elite people or is it more middle class or even all
classes?) Is the brand perceived to be bought by celebrities?
The customer “reflected image” is a key dimension of
brand choice for conspicuous behaviors: It creates value by
making the brand aspirational, a way to emulate these
people and at least symbolically be endowed with their
status, just by carrying the same brand logo. Luxury
brands elevate their clients.
●
Luxury brands promise more than being different; they
aim at uniqueness, exclusivity, a high singularity based on
history, high taste, as well as exclusive style, originality of
designs, creativity and avoiding becoming too classic.
●
Finally, as for all brands, some luxury brands are perceived
as leading brands, making the trend, driving today’s taste
and class: This makes them power brands.
Brand selection
What stimuli would be used to measure these perceptions? As
the brand is the aggregator of all the created values, we chose
to ask respondents to evaluate one brand picked randomly
among 12 brands. Knowing this brand was a condition for
answering. The choice of asking many items on only one
brand is based on the fact that respondents had to fill in a
lengthy questionnaire (the 42 aforementioned items) and that
the nature of these respondents (they are not students)
precluded asking such a list of questions on more than one
brand. In all, however, 12 brands were profiled. In addition,
respondents evaluated the brand in terms of desirability: How
much does this brand represent “a brand they dream of”? We
talk of dreams for – unlike mass goods which deliver
satisfactions – luxury proposes the achievement of ideals, by
making them real and accessible. Yet although luxury
companies tend to define themselves as “producers of
dreams” (Longinotti-Buitoni and Longinotti-Buitoni, 1999),
little research has focused so far on the luxury brands’ dream
potential (Dubois and Paternault, 1995). Because dreams are
usually not cheap, the profitability of the sector is very high.
Luxury is a sector with luxurious margins, a real financial
dream (Kapferer and Tabatoni, 2011).
The choice of these 12 brands was based on the premises of
this article: Modern luxury has abandoned objective rarity
(Nueno and Quelch, 1998; Kapferer, 2012). This was
necessary for securing the brands’ growth, fulfill expectations
of the stock market and shareholders today. For sure, some
well-known brands still limit their production, hence their
Items generation
From the outset, a series of in-depth interviews of a small
sample of luxury clients was conducted, as well as luxury
managers: What is it that made them love some specific brands
and not others? Why and how would a luxury brand lose its
cachet? In doing what? At what signs would one notice it? Why
are some brands not losing their cachet despite the visible
extension of their clientele? All the verbatim was then content
analyzed and categorized. All in all, this led to the selection of
42 items, which could be grouped according to the marketing
mix:
●
For the product dimension, the classical elements of
experience should be tapped: exceptional beauty, nobility
of ingredients, craftsmanship, do the products carry a
tradition or a heritage, have they the highest level of quality
and do they ignite emotions.
●
For pricing, we retained three items, which correspond to
typical policies of the luxury market: being expensive,
having a few products in the range totally out of reach,
and – at the opposite – developing accessible lines to
expand the customer base.
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Jean-Noël Kapferer and Pierre Valette-Florence
Volume 25 · Number 2 · 2016 · 120 –133
luxury?). The choice of a dichotomous single answer was
made to reduce the length of the questionnaire and to
polarize each brand.
long waiting lists (a few months for a Kelly bag at Hermès,
more than a year for a Ferrari [. . .]). We focused instead on
those brands which are not following a scarcity model but a
virtual rarity one (creating feelings of exclusiveness, of
uniqueness, etc [. . .]). These brands aim at being sales leader
and also perceived as luxury. Thus, Lexus USA claims it is
“USA N°1 imported luxury car brand”. The same holds true
for the challenger, Mercedes Benz. We also included such
brands as Louis Vuitton, still held by Interbrand in 2015 as the
world’s most valuable luxury brand, precisely because of its
phenomenal sales success despite its high price and never
making any price reduction or sales promotion. The more
successful this brand is, the more polarized are
consumers’evaluations of the brand, with some people
considering that Louis Vuitton has totally lost its luxury status,
while others still dream about it. The same can be said for
Ralph Lauren, Rolex, Armani, Mercedes and Estée Lauder.
From a methodological standpoint, focusing on brands
about which there is a debate guarantees high variance of the
answers. There is not much variance to expect when asking
whether Rolls-Royce or Hermès are luxury brands. Had we
selected such unanimous brands would have threatened the
conclusion validity of our statistical analyses. We chose
instead brands which would polarize opinions. We also
selected brands on which both men and women could answer.
The final list of brands is:
●
Lexus and Mercedes Benz;
●
Louis Vuitton and Longchamp;
●
Ralph Lauren and Giorgio Armani;
●
Mauboussin and Chaumet;
●
Lancôme and Estee Lauder; and
●
Rolex and Yves Saint Laurent.
The aim of the research is to identify what factors structure the
luxury brand experience and to illustrate which of them
contribute most to desirability (dream) and perceived
luxuosity of some selected brands beyond rarity. For
theoretical advancement, we shall explore how an overall
brand luxury desirability decomposes in lower-order
dimensions which ultimately end up to eight main experiential
factors.
Choice of the statistical methods
To determine the main dimensions of brand luxury
desirability, we first performed exploratory principal
components analyses with Promax rotation. Deleting items
with low communalities and loadings below 0.50 led us to
retain 34 items (among the 42) structured around eight main
dimensions (78 per cent of explained variance). In itself, this
result is striking: It contrasts with former similar research
where only three to five such factors emerged [for a synthesis
of research, see De Barnier et al.(2012)]. Then, we have
formally tested this solution by means of a confirmatory factor
analysis technique. To investigate how these eight factors
combine themselves and form distinct paths toward luxury
brands’ desirability, a PLS approach has been selected for
three main reasons:
●
First, because of its minimal demands on sample size and
suitability to handle with model complexity and violation
of multivariate normality (Bagozzi and Yi, 1994).
●
Second, because of its ability to handle higher-order factor
structures very easily (Wetzels et al., 2009).
●
Third, because of its unique capability to compute factor
scores that can help to profile the 12 brands under study.
What are the levers of the desire still attached to them by a
large number of consumers?
Sample of respondents
To have an access to relevant respondents, actual or potential
luxury buyers (unlike students too often used in published
luxury research), we used Le Figaro Magazine affluent
Internet panel. Le Figaro Magazine is France’s Number 1
magazine in terms of advertising by luxury brands. It has built
a panel of readers – called the Affluent Panel – who accept to
regularly be interviewed on editorial matters through Internet.
Our research was an exception: It was presented as
fundamental research. In terms of demographics, there were
49.2 per cent of women and 50.8 per cent of men. Mean age
was around 55 years old; 78 per cent hold a higher education
level, and 55 per cent had an average net income per month
greater than €5,000 (mean equals €87,250 of total net income
per year). Globally, 89 per cent could be characterized as
belonging to an upper socio-professional category. Finally, 53
per cent had bought an expensive luxury product during the
past 12 months. In all, 1,286 persons took part and completed
the questionnaire on the Internet, comprising two main sets of
questions:
●
The first set comprised the 42 Likert-type items discussed
above (Likert type in six points) on their perception of 1
brand randomly chosen among 12.
●
The second set relied on dichotomous global evaluations
of that brand (Is this brand dreamed of? Is it considered as
Results
The results will be presented in two main steps. Fist, a series
of exploratory, as well as confirmatory, factor analyses is
conducted, followed by more focused analyses dealing with
specific luxury brands to stress the managerial outputs
provided by the scale.
Profiling the brand luxury experience: What key
factors?
Scale structure and first-order dimensions
First of all, a principal component analysis allowed
determining the number of dimensions by means of a scree
test, indicating a clear elbow for eight dimensions. After
deleting items with loading below 0.5 and with low
communalities below 0.4, we got a shortened list of 34 items
that were subsequently submitted to a confirmatory factor
analysis.
Although the measurement and structural models are
simultaneously and iteratively estimated within the PLS
approach, the reliability and validity of the measurement
model should be first assessed. Once the adequacy of the
first-order construct measurements is verified, the structural
relationships among the constructs and the quality of the
overall model are then assessed (Fornell and Larcker, 1981).
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How luxury brands grow yet remain desirable
Journal of Product & Brand Management
Jean-Noël Kapferer and Pierre Valette-Florence
Volume 25 · Number 2 · 2016 · 120 –133
The adequacy of the reflective measurement model can be
assessed by looking at composite reliabilities, the convergent
validity of the measures associated with individual constructs
and discriminant validity (Henseler et al., 2009). Results are
displayed in Tables I and II. As for the first-order reflective
latent variables, all the indicators of convergent validity and
reliability are satisfied. Hence, a test of the discriminant
validity (Fornell and Larcker, 1981) shows that each
first-order latent variable shares more variance with its
respective indicators than with the other latent variables it is
correlated with. Ultimately, Table III of cross-loadings clearly
shows that each dimension is best measured through its
measurement variables. More precisely, this last table enables
to comment the eight identified dimensions, pointing out that
these dimensions often mix both tangible and intangible
elements:
Factor 1 is typically a product superiority factor. It comprises
notions of rare and noble ingredients, high quality as well as
exceptional beauty (an hedonic component). The product
embodies also tradition and heritage. In luxury, products are
not simple products: Their unicity is based on a rare mix of
tangibles and intangibles. They are a bridge between the past
and the present; quality is inspired by history. They are
hedonic, beautiful, refined and spirited.
Factor 2 is a selective distribution factor. Luxury brands must
be selective in everything they do, starting with the place
where they reign and can be met. Their stores must be
perceived as not numerous, as well as their atmosphere
expressing refinement, class not mass. So many licenses of
distribution have been bought back by luxury brands when
they felt the licensee was over distributing the brand, the
fastest way to dilute the exclusivity of the brand.
Factor 3 is a class and status factor. This powerful brand
stands above the others and endows the buyers with class and
status. It is a leading brand. All that it does has class (its
advertising for instance).
Factor 4 captures the ability of the brand to remain very
actual, unique, by generating excitement, by remaining alive
and active, original through time, today as yesterday (Groth
and McDaniel, 1999). Unlike fashion which captures the
spirit of the times and then goes, luxury brands resist the
deleterious effects of time. But they are not antiquities; they
must always prove their actuality, their relevance, be at the
forefront, be singular.
Factor 5 (Not for everybody) captures the respondents’
feeling that the clientele of the brand is or is not getting too
large. Luxury exists because everybody cannot access to it.
Interestingly, one of the items in this factor is related to pricing
(“the brand has introduced accessible lines”): Doing so, the
brand sends signals to its actual clients that it prefers volume
to value.
Factor 6 is a glamour factor. Luxury-like status is not created
by products alone. Status comes when status endowing people
choose that particular brand: This is the role of the celebrities.
Thus, Princess Grace of Monaco (formerly the Hollywood
actress Grace Kelly) made a Hermès bag famous all over the
world and become an icon of luxury. This is why brands must
manage their “reflected customer” image: It is a key
component of their desirability. This is also why they need to
choose their mostly symbolic clients.
Factor 7 is the elitism factor. It combines items about having
a great history, being very known and having some extremely
expensive products within their range, unaffordable. Factor 8
taps the necessary creativity of the brand, being fashionable.
The fashion weeks in New York or Paris are F1 races of
creativity where the Haute Couture brands are the competing
racing teams of the catwalks. Some brands become real “must
have” brands, hence their remarkable growth.
Higher-order dimensions
How do these eight factors combine to build the luxury dream
and desirability? In the above section, we analyzed the
first-order factors. In this section, we present a model where
these factors combine themselves two by two to build
higher-order unobserved variables.
An higher-order factor structure analysis estimated within
the PLS framework implies two parts: one related to the
measurement of the first-order latent dimensions and a second
structural one concerned by the strength of the connections
between the higher-order dimensions and their respective
lower-order facets. In that precise case, one has to be aware of
the exact choice of the nature of the relations between latent
concepts, that is to say, to decide of the choice between either
reflective or formative indicators (Wetzels et al., 2009). More
Table I Reliability and convergent validity of first-order dimensions
First-order dimensions
Convergent
validitya
Jöreskog’s
rhob
Product superiority
Selective distribution
Not for everybody
Actual still unique
Elitist
Glamour
Gives class and status
Fashionable
0.660
0.718
0.621
0.521
0.549
0.678
0.522
0.594
0.931
0.884
0.868
0.867
0.824
0.863
0.813
0.806
Notes: a % of shared variance between the latent variables and its indicators; b reliability coefficient scaled between 0 and 1
Table II Reliability and convergent validity of higher-order dimensions
Second order
Objective rarity
Exclusivity
Prestige
Creative leadership
Convergent
validitya
Jöreskog’s
rhob
0.86
0.78
0.73
0.82
0.92
0.88
0.84
0.9
Third order
Convergent
validity
Jöreskog’s
rho
Selection
0.7
0.82
Seduction
0.82
0.9
Fourth order
Convergent
validity
Jöreskog’s
rho
0.9
0.94
Luxury desirability
Notes: a % of shared variance between the latent variables and its indicators; b reliability coefficient scaled between 0 and 1
125
Each of its products expresses a unique know how
It has some products with an exceptional beauty
This brand symbolizes refinement
The brand uses noble and rare ingredients
Its products have in themselves an heritage
A real superior quality of product
It is a brand unique of its kind
Can not be found everywhere, selective distribution
It is produced in small series, not in mass
Its stores are very select with a real atmosphere
The brand conveys status to its clients
The brand is renowned leader in its category
Its advertising has a lot of class
The brand endows class to those who use it
This brand is still what it used to be
For me, the brand still keeps its exclusive character
This brand is still up to date
This brand is not too classic
Today, this brand keeps its originality
We still hear about this brand today
It is not purchased by customers from all walks
For me, it is not too diffused today
It is not a bit bought by everyone
Most of its products are not at all affordable in
price
It is a sophisticated brand
The brand makes us think of rich and famous people
It is bought by celebrities
The brand has a great history
It is a very known brand
It is very expensive
Some of its products are really unaffordable
It is very creative
It sets the fashion launches styles
It is much talked about in people or fashion
magazines
Items
Table III Original items and cross-loadings
Selective
distribution
0.587
0.472
0.655
0.690
0.593
0.586
0.616
0.854
0.878
0.808
0.479
0.530
0.513
0.499
0.099
0.206
0.110
0.045
0.145
0.009
0.211
0.221
0.183
0.073
0.458
0.523
0.482
0.414
0.207
0.432
0.365
0.460
0.412
0.277
Product
superiority
0.830
0.764
0.842
0.828
0.804
0.817
0.798
0.557
0.636
0.704
0.596
0.666
0.627
0.651
0.187
0.254
0.228
0.084
0.241
0.106
0.078
0.204
0.086
0.051
0.506
0.532
0.483
0.648
0.361
0.391
0.357
0.637
0.532
0.257
126
0.447
0.546
0.499
0.536
0.375
0.343
0.342
0.578
0.559
0.291
0.628
0.596
0.731
0.635
0.644
0.663
0.654
0.474
0.518
0.650
0.801
0.788
0.733
0.827
0.161
0.223
0.261
0.102
0.232
0.142
0.057
0.186
0.083
0.077
Class and
status
0.068
0.070
0.078
0.064
0.059
0.037
0.088
0.249
0.161
0.071
0.203
0.192
0.266
0.222
0.152
0.273
0.253
0.118
0.109
0.173
0.139
0.254
0.215
0.273
0.710
0.697
0.754
0.640
0.730
0.792
0.279
0.516
0.306
0.030
Very actual still
unique
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0.097
0.170
0.126
0.039
0.182
0.217
0.112
0.007
0.049
0.159
0.077
0.042
0.118
0.120
0.062
0.140
0.083
0.237
0.237
0.117
0.128
0.016
0.030
0.140
0.277
0.450
0.262
0.215
0.267
0.071
0.865
0.694
0.843
0.509
Not for
everybody
0.532
0.486
0.465
0.482
0.523
0.485
0.438
0.408
0.398
0.476
0.478
0.462
0.386
0.383
0.067
0.037
0.031
0.031
0.014
0.080
0.059
0.004
0.007
0.166
0.391
0.501
0.497
0.701
0.646
0.761
0.775
0.372
0.327
0.259
0.743
0.889
0.832
0.378
0.284
0.454
0.486
0.370
0.381
0.357
Elitist
0.448
0.387
0.540
0.517
0.498
0.527
0.563
0.479
0.504
0.532
0.477
0.479
0.449
0.507
0.042
0.142
0.084
0.042
0.056
0.046
0.165
0.090
0.103
0.128
Glamour
0.396
0.395
0.365
0.446
0.344
0.254
0.193
0.853
0.898
0.497
0.563
0.554
0.556
0.497
0.475
0.466
0.534
0.370
0.419
0.507
0.490
0.530
0.557
0.466
0.016
0.110
0.195
0.119
0.200
0.127
0.063
0.024
0.041
0.160
Fashion
How luxury brands grow yet remain desirable
Journal of Product & Brand Management
Jean-Noël Kapferer and Pierre Valette-Florence
Volume 25 · Number 2 · 2016 · 120 –133
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How luxury brands grow yet remain desirable
Journal of Product & Brand Management
Jean-Noël Kapferer and Pierre Valette-Florence
Volume 25 · Number 2 · 2016 · 120 –133
precisely, the choice is between one of the four potential
hierarchical models put forward by Becker et al. (2012). The
reflective-reflective Type I model has been selected, as the
objective of the study is to find out the common factor of
several related, yet distinct reflective constructs. The rationale
behind that choice is that similar to the concept of human
personality, we assume that a global luxury desirability
orientation does exist and reflects in lower-order dimensions,
representing different facets of the relationship between
consumers and luxury brands. Moreover, this point has been
exemplified through the qualitative part of the survey, as a
global luxury desirability orientation did show up. On a more
practical side, as recommended by Becker et al. (2012), we
relied on the repeated indicators approach with an inner path
weighting scheme and Mode A of measurement on the
higher-order constructs.
Although the measurement and structural models are
simultaneously and iteratively estimated within the PLS
approach, the reliability and validity of the measurement
model should be first assessed. As the adequacy of the
first-order construct measurements has been verified, the
structural relationships among the constructs and the quality
of the overall structure of the model can then be assessed.
Although PLS does not provide any global goodness-of-fit
indices as those used for covariance-based structural equation
modeling, Tenenhaus et al. (2005) propose the geometric
mean of the average communality (measurement model) as
well as the average R2 (structural model), as an overall
goodness-of-fit (GoF) measure for PLS. In this research, the
absolute GoF value is 0.587, corresponding to an excellent
adjustment according to Wetzels et al. (2009) (GoF higher
than 0.36 are large).
In terms of the four second-order reflective latent variables,
convergent validity and reliability, displayed in Table II, are
fairly good as well. The same holds true for the third- and
fourth-order latent dimensions. Finally, a test of the
discriminant validity (Fornell and Larcker, 1981) shows that
the conditions are met with respect to second- and third-order
factors.
All in all, the eight first-order dimensions, hence, combine
into broader macro variables, up to the luxury desire/dream.
The eight original factors are organized according to an axis
from tangible (on the top) to intangible (at the bottom), from
physical to felt, from physical experience to symbolic image
(Figure 1 and Table II).
The aforementioned model reveals that two major distinct
paths do build the luxury desire. On the top of Figure 1, the
four factors relate to the classical mode of luxury brand
Figure 1 PLS hierarchical confirmatory factor analysis of luxury desirability
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Journal of Product & Brand Management
Jean-Noël Kapferer and Pierre Valette-Florence
Volume 25 · Number 2 · 2016 · 120 –133
building. Luxury is not mass. It is just the opposite. It starts
with products, out of the ordinary, rich in emotions: superior
quality, craftsmanship, full of hedonism and being the fruit of
history and tradition. Luxury opposition to mass marketing is
also made through its selective distribution: very few stores but
highly qualitative stores. It is important to be strict concerning
where the stores will be located, how many will they be? In
what type of town, of street, with what atmosphere? Both
factors create feelings of possessing something rare, which
does not mean just scarce, but also far above the ordinary.
Although high quality is necessary, this is not sufficient to be
qualified as luxury: The products are also to be perceived as
social and cultural markers. The brand must look exclusive:
This is achieved through two factors. First, the brand needs to
convey that it is not for everybody: This is done by restricting
its diffusion, limiting its accessible product lines, controlling
its prices and most of all taking care of whom is wearing it on
the streets. As Luigi Longinotti-Buitoni, former CEO of
Ferrari North America, says “Luxury brands must select
customers for the brands are what their customers are”
(Longinotti-Buitoni and Longinotti-Buitoni, 1999, p. 148).
The second factor of exclusivity is more intangible: It refers to
the singular style of the brand, intemporal and yet remaining
so original, actual. Exclusivity here refers to the permanence of
the brand, remaining one of its kind, singular in its style or
behavior, also in the ability to always be very present in the
media. As a whole, these four factors constitute what we called
the “selection path”.
In the tested model, the bottom four factors are playing
another game: fame. The glamour factor is constructed by the
celebrities believed or known to be buying the brand. They are
themselves very mediatized and contribute to make the brand:
Audrey Hepburn made Tiffany and as Grace Kelly made
Hermès. Together with the elitism factor (the brand being
associated with very high ticket special items, inaccessibility),
these VIP’s build the “prestige level” of the brand. The last
two factors of the model are on the one hand the creative, edgy
dimension of the brand and, on the other hand, its status and
perceived leadership among all other brands of its class. Both
factors merge into “creative leadership”. As a whole, these
four factors constitute the “seduction path”. Looking at the
whole tested model, one can identify two structural paths of
luxury dream building: selection and seduction.
Finally, thanks to a systematic bootstrapped procedure, we
compute the total effects from the overall global luxury
orientation (on the right) to the eight first-order dimensions
(on the left). The pattern displayed in Table IV provides
meaningful insights. All in all, the decomposition of the
influence of luxury desirability shows a noticeable dilution
effect even though all the coefficients are statistically
significant. The dilution effect refers to the fact that at the
first-order level, the influence of luxury desirability is
mitigated by all the intermediate paths. For instance, the
impact of luxury desirability on product superiority goes
through selection and objective rarity (hence, 0.982 ! 0.958 "
0.953 " 0.977). It is worth noticing that by far and foremost,
“product superior quality” (unique know-how, rare ingredients and
exceptional beauty, with heritage) has the strongest indirect
relationship to the global overall luxuriousness, immediately
followed by “gives class and status” and “selective distribution”,
whereas “very actual and still unique” and “not for everybody” show
the least incidences. This indicates that the product felt rarity
(instead of actual rarity) is of foremost importance. This is made
by a combination of singularities, both tangible and intangible.
Then, the brand must give class and status to its beholders, its
clients: This is the second role of the price paid. As reminded by
Kapferer and Bastien (2012), luxury is like Janus, a two-faceted
God: luxury for oneself, luxury for others. In third, one finds
Table IV Indirect bootstrapped effects and confidence intervals
Independent variables
Dependent variables
Estimates
Luxury desirability
Luxury desirability
Luxury desirability
Luxury desirability
Luxury desirability
Luxury desirability
Luxury desirability
Luxury desirability
Luxury desirability
Luxury desirability
Luxury desirability
Luxury desirability
Seduction
Seduction
Seduction
Seduction
Selection
Selection
Selection
Selection
Objective rarity
Product superiority
Selective distribution
Exclusivity
Not for everybody
Very actual still unique
Prestige
Creative leadership
Glamour
Elitist
Class and status
Fashionable and creative
Class and status
Fashionable and creative
Glamour
Elitist
Product superiority
Selective distribution
Not for everybody
Very actual still unique
0.913
0.892
0.800
0.660
0.597
0.566
0.811
0.887
0.667
0.720
0.836
0.774
0.889
0.823
0.709
0.766
0.930
0.835
0.624
0.591
128
Bootstrapped parameters
t-tests
Lower 95 %
229.81
200.63
95.73
23.96
22.44
21.54
75.305
146.14
46.51
54.68
115.44
75.20
172.24
93.45
50.62
61.46
253.48
101.63
23.30
22.30
0.906
0.884
0.788
0.614
0.553
0.522
0.794
0.876
0.641
0.698
0.824
0.754
0.880
0.807
0.683
0.744
0.924
0.823
0.580
0.547
Upper 95 %
0.919
0.899
0.816
0.709
0.644
0.611
0.830
0.897
0.694
0.742
0.847
0.792
0.898
0.838
0.736
0.788
0.937
0.849
0.670
0.637
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How luxury brands grow yet remain desirable
Journal of Product & Brand Management
Jean-Noël Kapferer and Pierre Valette-Florence
Volume 25 · Number 2 · 2016 · 120 –133
selective distribution. One will never insist enough on the
importance of the retail behavior of luxury brands: When should
they stop opening new stores in a country or even start closing
stores there? This is also why e-commerce is both a blessing and
a threat: It aims at people who cannot find a store, but it is also
open to anyone, without any selectivity. Considering the 12
widely known brands purposely chosen as stimuli in this research
(leading luxury brands), it is no surprise that “not for everybody”
came last as building the luxury experience. Last does not mean
non-significant however. There is no luxury if it aims at all.
another business model, such as masstige for which looking
after volume is not an issue.
Profiling the levers of each brand’s luxury and dream?
In this study, respondents did not only express their
perception of the brand, of its behavior, of its marketing and
influential mix, they also declared whether that particular
brand “made them dream” and whether they considered it as
“prototypical of luxury”. Indeed, what are the links of the
eight factors analyzed above and the dreamability of a specific
brand and its assessed luxury status? Naturally, the answers
should differ per brand and per consumer. Some consumers
prefer bespoke brands, others just the opposite. Answering
these questions will validate the managerial as well as the
theoretical scope of the proposed model of luxury desirability.
A straightforward way to assess such a research question is to
perform simple analyses of variance between those who dream
and those who do not dream about the brand and the eight
aforementioned dimensions, for each of the 12 selected
brands. The same holds true for the perception (or not) of the
brand as being a luxury brand.
Predictive validity analysis
On an operational side, one question arises. Is the scale able to
differentiate between brands felt as both luxurious and dreamt
about from those which are not? All in all, 55 per cent of the
12 selected brands are both dreamt about and considered as
luxurious by the respondents (85.7 per cent of the 12 brands
are seen as luxury ones, whereas only 59.8 per cent of these 12
brands are dreamt about). A binary logistic regression
confirms the predictive power of the scale with a medium
range pseudo R2Nagelkerke of 0.472 and a significant !2
(32.368; p ! 0.0008) improvement over the null model.
Overall, even if the model is able to predict 74.8 per cent of the
observed status of the brands, solely four of the eight
dimensions have a significant Wald tests (5.80; 5.02; 4.61 and
4.25, respectively, for “product superiority”, “fashionable and
creative”, “selective distribution” and “not for everybody”). In
other words, this result means that these four first-order
dimensions will increase the overall likelihood that the brands
be considered both as luxurious and dreamt about.
One can consider that these four facets constitute the kernel
of luxury attractivity, reminding that “product superiority” is
a factor which, in fact, combines tangible and intangible
singularities such as heritage, beauty, know-how (as shown in
the wording of the items loading on this first factor, see
Table III). A luxury brand is not a fashion brand: both are
different business models (Kapferer and Bastien, 2012), but
luxury must not make you look out of fashion. Luxury must be
of its time, not stuck in the repetition or worship of its past. It
must also differentiate its clients from the mass. There is a
limit to the quantitative expansion of buyers and stores in
luxury, unless one just wants to look like luxury yet adopt
The dream profile of well-known brands
With regard to the luxury factors that weight most on the
“dreamability” or “dream value” of each brand, we chose to
focus below on three highly successful brands: Louis Vuitton,
Giorgio Armani and Ralph Lauren. Despite their continuous
growth, they still fuel the dream of many consumers. Table V
summarizes the main dream levers of these three luxury
brands based on whether the respondents were dreamers or
not of that brand. These dream profiles are based on those
factors which discriminate between those consumers who
dream of the brand and those who do not. These dream profiles
are of high interest for luxury executives. Looking at the
results in Table V, Louis Vuitton builds its dream value first
through elitism (by always increasing its average prices,
through charity auctions where artistic exceptional pieces are
sold a million euros). Second, Louis Vuitton – as a leading
brand – provides a universal visa of class (at least, this is what
its dreamers believe). Superior quality/tradition/heritage
comes as the third lever of the Louis Vuitton dream (the
unique know-how of this historical Maison de Luxe). Fourth,
highly communicating that it is bought by edgy celebrities
endows the brand with glamour. Fifth, the perception of
Table V. Dream levers of three luxury brands (ANOVAs of dreamers versus non dreamers)
Louis Vuitton
Dream/non-dream
Elitist and expensive (3.48/3.04)a
(F ! 12.2; p < 0.001)
Status and class (5.33/5.13) (F ! 11.7;
p < 0.001)
Product superiority (4.55/4.17)
(F ! 11.1; p < 0.001)
Glamour (4.25/3.95) (F ! 7.3;
p < 0.008)
Fashionable (3.98/3.47) (F ! 4.0;
p < 0.045)
Giorgio Armani
Ralph Lauren
Status and class (4.17/3.98) (F ! 13.6; p # 0.000)
Status and class (4.08/3.96) (F ! 24.0;
p # 0.000)
Selective distribution (3.69/3.11) (F ! 14.0;
p # 0.000)
Product superiority (3.58/3.27) (F ! 10.9;
p # 0.001)
Glamour (3.29/3.09) (F ! 7.6; p # 0.007)
Product superiority (3.74/3.56) (F ! 11.7;
p # 0.001)
Fashionable (3.64/3.51) (F ! 8.8; p # 0.004)
Glamour (3.35/3.66) (F ! 7.9; p # 0.006)
Selective distribution (3.71/3.52) (F ! 4.9;
p # 0.028)
Note: a Mean values (dream/non-dream)
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How luxury brands grow yet remain desirable
Journal of Product & Brand Management
Jean-Noël Kapferer and Pierre Valette-Florence
Volume 25 · Number 2 · 2016 · 120 –133
fashion, however, is only marginally contributing to the Louis
Vuitton dream (as indicated by the almost non-significant).
Louis Vuitton remains a leather brand and fashion is only
incidental there.
Now if we look at Giorgio Armani’s dream, it is made first
of status/class and then of product excellence (superb
materials, unique fabrics, style, know-how). Interestingly, the
third lever of the Armani dream is the creativity, being
fashionable. Most interesting is the case of Ralph Lauren:
How is their dream built in Europe (where the brand is now
just expanding) and in France in particular? Ralph Lauren’s
dream is strongly on its communication which expresses status
and class. It is also based on its very selective distribution
policy in Europe (unlike in the USA). Ralph Lauren is above
all a retail experience. In Europe, it does not advertise much,
but the rare stores speak for themselves: They are real
mansions designed to make the buyer feel like he/she is in Mr
Ralph Lauren’s own home. Considering these data, this dream
building distribution strategy is paying off. Ralph Lauren’s
dream is built by its incredible distribution.
Louis Vuitton perceived luxuosity. Those who still perceive
Louis Vuitton as luxury consider that:
●
the brand has not lost its exclusivity at all, that it is still very
actual;
●
that it leads its category, gives great class;
●
that it has really superior products (craft, noble
ingredients, with tradition); and
●
that this brand is not bought by all kind of people today,
that it remains not for everybody.
Only two of these factors also influence the dream of Louis
Vuitton (status/gives class and exceptional products), but the
dream is first fueled by the amazingly high prices exhibited by
some products of this brand (even the smallest key holder is
worth more than €120) and by the halo of glamour around this
brand (celebrities from the Arts, cinema, rich and famous
clients), as well as its fashionability, being much talked about
by the media or social networks (the sure consequence of
hiring the fashion designer Marc Jacobs and now Nicolas
Ghesquière).
To summarize, one finds that three of the four levers of
Louis Vuitton dream come from the seduction path. This is the
reverse of the perception of luxury: Three levers of four come
from the selection path.
Dream versus luxury profile
Are there differences between the dream profile and the luxury
profile? Certainly, luxury largely fuels the dream, yet both
concepts have their specificities. In the present study, each
respondent evaluated one brand – among the 12 brands – on
34 Likert items. Respondents were also asked to categorize
this brand in a binary way on two accounts: Does this brand
make them dream (Yes/No) and do they consider that it is a
luxury brand (Yes/No)? It is interesting to compare the
determinants of each of these two judgments among the eight
factors identified above. Table VI summarizes such results for
Louis Vuitton, the world’s most valuable luxury brand
according to Interbrand and Millward Brown. Because of
Louis Vuitton’s systematic worldwide growth, critics voice
that this brand is not part of luxury anymore. However, year
after year, Louis Vuitton has continued its growth, from Japan
to China and now new continents. This brand has been
pioneer in demonstrating how one could grow, abandoning
physical rarity and still remain considered by influential as
leading the luxury sector, at least up till now. In our study,
79.4 per cent of those who evaluated this brand (n ! 136)
categorize it as luxury. But only 44.1 per cent say the brand
makes them dream. This shows that although luxury
companies like to say they sell a dream, this may not be the
case for all. Here, half (45 per cent) of those holding Louis
Vuitton as luxury say that the brand does not make them
dream. Let us analyze what factors explain their judgment.
It is interesting to notice that the determinants of the Louis
Vuitton dream are not exactly the same as the determinants of
Positioning the luxury brands
On a global basis, and to obtain a more comprehensive picture
of all the brands encompassed in this study, we used a
multi-dimensional scaling approach to position the 12 brands
on a map based on their latent PLS scores on the 8 dimensions
discussed above. The map is derived from Euclidean distances
between the 12 brands using a metric multi-dimensional
analysis (PROXSCAL). The quality of the adjustment with
two dimensions is satisfactory (96 per cent of variance
accounted for; Tucker congruence coefficient: 0.984).
The map provides a clear picture (Figure 2) that shows
three groups of brands with, on the left-hand side, the long
established luxury brands with a high history within the luxury
industry such as Chaumet, Louis Vuitton, Rolex and Yves
Saint Laurent Couture and, on the right-hand side, brands
perceived as having a higher diffusion. At the bottom right,
one finds a group of “new world” brands, new comers such as
Lexus, Ralph Lauren or Estee Lauder and, at the upper right,
more well-known brands, not edgy, probably held as masstige
today by many, somehow more diffused and accessible. The
map clearly depicts that Longchamp and Louis Vuitton are on
the opposite sides of luxury: one accessible and discreet, the
other flamboyant and expensive. Interestingly, Armani is in
the middle of the map, both classic, not recent and yet very
modern. Mauboussin, the price driven jeweler, based Place
Table VI Luxury drivers versus dream drivers of Louis Vuitton
Dream /non-dream
Luxury/non-luxury
a
Actual still unique (3.80/3.04) b (F ! 11.7; p # 0.001)
Status and class (5.25/5.08) (F ! 9.1; p # 0.003)
Product superiority (4.41/4.09) (F ! 6.8; p # 0.010)
Not for everybody (4.16/3.73) (F ! 3.7; p # 0.05)
Elitist and expensive (3.48/3.04) (F ! 12.2; p < 0.001)
Status and class (5.33/5.13) (F ! 11.7; p < 0.001)
Product superiority (4.55/4.17) (F ! 11.1; p < 0.001)
Glamour (4.25/3.95) (F ! 7.3; p < 0.008)
Fashionable (3.98/3.47) (F ! 4.0; p < 0.045)
Notes: ANOVAs of dream/non-dream and luxury/non-luxury on each factor;
a
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mean values (dream/non-dream); b mean values (luxury/non-luxury)
How luxury brands grow yet remain desirable
Journal of Product & Brand Management
Jean-Noël Kapferer and Pierre Valette-Florence
Volume 25 · Number 2 · 2016 · 120 –133
Figure 2 MDS! (PROXSCAL) map of the 12 luxury brands
PREFSCAL Mapping
3
2
Mercedes
Longchamp
Dimension 2
1
Rolex
Mauboussin
Louis Vuitton
0
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Chaumet
Giorgio Armani
Yves Saint Laurent Couture
Lexus
–1
Ralph Lauren
Estee Lauder
–2
–3
–4
–2
0
2
Dimension 1
Notes: *Euclidean representation of distances between the 12 brands with regard to their means
values on the 8 first-order dimensions
dreams in which products and services which are unique,
exclusive, beautiful, rich and glamorous are created to
exceed the customers’ imagination” (Longinotti-Buitoni
and Longinotti-Buitoni, 1999, p. 40), yet all luxury brands
do neither convey the same amount of dream nor the same
dream. Some luxury brands even lack of dream: They rely too
much on the upper path of our luxury building integrated
model, selectivity based on tangibles and exclusivities – either
virtual or real. Reversely, some brands can carry a dream while
not being fully perceived as luxury. This is the case of Audi in
our study: Compared to Mercedes or BMW, this brand is
rather recent, thus has neither history nor tradition. Its slogan
is oriented toward the future: “Progress through technology”.
Interestingly, it has a higher dream value than one would
expect on the basis of the luxury perception of the brand. It is
possible that the levers of luxury perception are not just
mirroring those of dream building. For Louis Vuitton, this is
just the case.
On operational grounds, this research provides a new model
for brand management: Starting at the operational side, the
Vendome, is now perceived where it stands: on the high
diffusion side, as it moved out of pure Luxury Strategy to
increase its volume through lowering the price range and
extending distribution worldwide.
Implications and conclusion
This research has both theoretical as well as managerial
implications. On theoretical grounds, it calls the attention on
the need to take full account of the brand itself, besides the
classic product-related facets of luxury. In modern luxury,
having an emotionally intense product certainly remains the
cornerstone of brand building. But with time, it is also
necessary to endow the brand with a high seductive symbolic
capital that can be passed onto the customers themselves.
Based on a PLS fourth-order modelization, we have identified
the levers and paths of luxury dream building.
On theoretical grounds, it is also interesting to explore
the relationships between the dream potential and luxury.
Certainly, as said by Ferrari’s North America CEO, “So
called luxury companies best exemplify an industry of
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How luxury brands grow yet remain desirable
Journal of Product & Brand Management
Jean-Noël Kapferer and Pierre Valette-Florence
Volume 25 · Number 2 · 2016 · 120 –133
one experienced by customers too, it shows how higher-order
perceptions of value are built, up to the final desire for the
luxury brand. It also calls for replications and certainly
extensions to more than 12 brands. Obviously, international
and cross-cultural investigations are deemed necessary.
Although France is a major luxury producing country, hence
also shapes the world vision of luxury, consumption is now
elsewhere. In these other countries (USA, China, soon Brazil,
Nigeria, etc.), we do not expect other factors to play a major
role but to see differences in the paths coefficients relating the
fourth-order latent variables to lower-order variables. To
conclude, we do hope that this present research opens new
research avenues aimed to better delineate the intriguing
borders of luxury consumption, as this sector continues to
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Corresponding author
Jean-Noël Kapferer can be contacted at: jnkapferer@
inseec.com
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