One thing is certain -- it's a relative idea. For example, Hyatt is not a premium brand if you're used to staying at a W or a Ritz Carlton. But if your vacations to date have been holed up in a Holiday Inn, then by all means a stay in a Hyatt is a premium experience.
Another thing is certain -- a brand is considered premium only when we believe it is worth the price. And that's where we can dig deeper. Why are we willing to pay more for a product when there are others that provide the same service or function at a lesser price?
I believe it is because a premium brand is built upon specific tangible and intangible attributes that give it a sense worth:
- Sensuality -- it is sensory, tactile and a bit mysterious.
- Rarity -- it represents a discerning choice, intriguing because it is uncommon.
- Confidence -- it projects a feeling of intrinsic worth.
- Authenticity -- is has a sense of "true north" and remains true to this ideal.
- Quality -- it is consistent and shows extreme attention to detail.
Think Tiffany, Apple, BMW, L'Oreal, Viking and Range Rover.
Conversely, think about premium brands that became confused by launching questionable line extensions or branding strategies, or became too common by embracing mass marketing strategies in pursuit of volume: Starbucks, Absolut and Jaguar.
Managing a premium brand is one of the most difficult challenges in marketing. Like all business, they must pursue growth strategies. However, unlike many mainstream businesses, premium brands must do so in a way that doesn't dilute the brand's image or the user's sense exclusivity and pride. Certain strategies are off-limits. Brand managers for premium brands must know when it is best to pass on short-term growth opportunities that could tarnish the brand's long-term health.
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6 comments:
Very useful post. I would be pleased if you could recommend me sourcesi of information on premium brands.
I would like to go into deeper into:
- connection between buyers indentitiy and identity of brand
- how to define buyer of premium brand
Best Regards,
Jan
nice post. What's the difference between a luxury brand and a premium brand?
Can premium be only defined by price? Why do shopper segment the brands intheir head based on price when their is no imagery around it? I may be wrong but i strongly feel that price definetly play an important role in positioning a brand at premium segment.
there will be also an other question "what makes a regular brand premium?". cool colors? pure layouts? sophisticated communication messages? i think there is a new need of brands like "to be premium", also they are low brands.
You might want to rethink BMW being a premium brand. As a whole it has been totally diluted by the introduction of the smaller, cheaper models aimed at making it more affordable to the masses and also BMW is now considered a volume manufacturer. On the other hand, Jaguar is now considered a premium niche brand with only 3 models in it's range and an entry price of £30k with production numbers more akin to Porsche (appx 60k units per annum world wide. I know its been a couple of years since the post but i only just stumbled across it today.
very useful! thanks
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