MKTG621

INDIVIDUAL IN-CLASS ASSIGNMENT ON 11 JANUARY 2024 FROM 10:00 – 12:00 IN APJ106

(20% of you overall grade)

Answer the two questions below and submit your answers to frederick.herbst@flame.edu.in at the end of this session. Label your
MSWord file as follows: Surname_Initial(s)_Student number

Question 1
Luxury marketing is different, because luxury brands are different. Develop a generic comparison (similarities and/or
differences) between a premium and a luxury brand by using the Table below.

Marketing mix instrument Premium brand Luxury brand

https://assemblo.com/guides/what-are-the-
7-ps-of-marketing/
Product/Brand
It goes without saying that the service or
product you’re selling should be at the centre
of every element of the marketing mix.
Fundamentally, it allows you to address the
questions key to sales conversion: what
problem or issue does the product solve for
customers? Why is your product the best one
to solve it? The digital marketing mix is
perfect for showcasing your products,
through SEO, blogs or articles, paid
advertising, influencer marketing, and viral
video campaigns.
 Premium brands aim to solely deliver product
attribute to make it easier for brands to be
compared.
 The country of origin is not important to produce
and sell.
 They are constantly innovating with time.
 Their aim is to sell as much as they want till or
above their sales target.
 Luxury brands want to deliver a timeless
experience. A brand's "luxury" status hinges on
how consumers view it, not just objective factors
like price or quality.
 The country of origin is VERY IMPORTANT.
 They care about creating a product which people
can have for lifetime and they value still would
not depreciate and can be passed on to their
future generations.
 They do not innovate with time.
 They only want to target hitting the sweet spot

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Price
The strategy behind the pricing of your
product needs to be based on what your
customers are prepared to pay, costs such as
retail mark-up and manufacturing, as well as
other considerations. Your marketing mix can
include subscription and membership
discounting programs, or email marketing of
promotions and sales.
Place/distribution
Where and how your product is displayed and
sold should be directly informed by your
customers. A deep understanding of their
purchasing patterns – and targeting them at
the right stage in their buying cycle – will
make it clear where you should promote and
sell your products and how that fits into your
online and real-world marketing mix.
Promotion/IMC
Successful marketing strategies include all
the promotional activities across the
marketing mix, including advertising, direct
marketing, and in-store promotional activities.
The possibilities of digital promotion are
limited only by your imagination and can
include online events, chats, social media
groups, and livestreams.
People
Excellent customer service not only converts
to sales, but can increase your customer base
by referrals. Acquiring these referrals by
people who love your brand can also be a
great example of how your marketing efforts
can support your sales process. It’s important
that everyone who represents your brand or
deals with customers – including the non-
human chat bot variety! – are fully trained
 Premium brands aim to justify their pricing
through different attributes and features in their
product. For example BMW and Audi has
different sets of features in their different models
for their particular consumer, hence here you can
compare.
 They have larger chunks of distribution all over
the globe.
 They aim to make their products easily available
and hassle free.
 They do not care about the origin of the brand’s
production hence it is sold everywhere.
 Premium brands aim to target masses while
creating advertisements.
 They henceforth use almost a few promotional
IMC tools such as, digital marketing, social
media marketing, multimedia.
 They promote their product and their value than
the experience.
 In premium brands, the sales staff is very excited
and wants you to leave after buying.
 These brands train their staff to be chatty and
interactive to make their products sell.
 Their customer service is neat and clean and is
repetitively used.
by selling a few.
 On the other hand Luxury brands are rare and
they aim to provide a lifestyle, hence the pricing
is always high and keeps increasing with time to
create a sense of exclusivity and rarity.
 They follow selective distribution in order to
create a fake barrier for the consumers so that
they feel that the product is rare and valuable.
 They are only called luxury brands if they
produce in their brand’s origin : eg; Swiss
watches are made it Switzerland only.
 Their products are only limited to a certain
number. Example: Rolex had created a model
with only 7 watches available worldwide.
 Luxury brands do not want to pamper to their
customer wishes. No catering to masses.
 They sell “stories”, not products.
 They aim to target customers who are
enthusiasts and are qualified to buy it.
 Not to sell but provide visual appeal and brand
awareness. Example: Cartier used a leopard in
their ad to create a sensation that it’s only for the
successors.
 Luxury brands, hardly have 1 or 2 sales people
in their store, who are trained to not speak much
to you.
 They understand that the consumers who want to
buy their products will any which ways buy it.
 They want to create a very intimidating
experience whilst you enter the store.
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sales professionals with an intimate
knowledge of your product and how it will
improve the lives or solve the problems of
your customers.
Processes
The process of delivering your product to the
consumer should be designed for maximum
efficiency and reliability, but may also include
features that are in line with your brand, such
as being environmentally or sustainably
focused. With the rise in online shopping,
digital partnerships and logistics have
become an essential part of the marketing
mix.
Physical evidence
Physical evidence incorporates aspects that
proves your brand exists and that a purchase
took place.
 Premium brands do not care much about
sustainability. For ex: ZARA follows fast fashion
as they want to cater to mass and keep
innovating.
 They are present all over the internet and their
products can be easily brought through online
websites as well.
 They provide you with a bill and online emails
to make sure you made a purchase.
 They do not provide after sales service because
they know their brand is timeless.
 Luxury brands are here to provide sustainability.
Each product manufactured is with a lot of deep
thought and is a masterpiece.
 They are present online but only to show the
catalogue and not let users buy it online.
 They too provide with a bill with authenticity
certificate for the users to feel convinced.
Example: Every time you buy from Chanel, they
provide you with a stamp of authenticity and a
certificate which proves it.
(10 marks)
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Question 2:
Explain 3 major differences between premium and luxury brands and their implications for luxury brand managers. Your answer should not
exceed 300 words.
Ans.
A luxury brand is “A branded product/service that consumers perceive as being of high quality, providing authentic value, having a prestigious image in the
market, justifying a premium price, and evoking a profound connection with the consumers.”

1. How to sell?
The major difference between premium and luxury brands is the tactics their brand managers use to sell their products. Luxury brands managers make
artificial barrier for consumers to feel that it’s hard to buy, by limiting sales, by pushing prices and by selective distribution channels. As well as the luxury
stores are like secret palaces where u feel intimidating. On the other hand, premium brands do no such thing, they are easily and readily available in stores and
online.

2. What kind of consumers?

Luxury brands only produce for consumers who are highly “QUALIFIED” to buy, enthusiasts, people who want to achieve a status symbol not only for
oneself but for their future generation. On the other hand, premium brands, targets between mass to luxury market.

3. Originality?
Luxury brands are only and sole heartedly about their BRAND’S ORIGIN. Luxury brands can only be called luxury if they are producing and manufacturing
their goods in their origin. Example: Fendi is made in Italy, Chanel is made in France. Premium brands on the other hand, do not pay attention on the
brand’s origin or authenticity, they outsource their production from everywhere.

Here the luxury brand managers need to especially understand where and how is the product sourced from, second is to sell the story plus experience instead
of just selling the product. And to not reply to the demand or not pamper customers wishes. (10 marks)

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List of references (Provide your list of references below – in alphabetical order and don’t number the sources)

Luxury branding: the industry, trends, and future conceptualisations by Yuri Seo School of Marketing and International
Business, Victoria University of Wellington, Wellington, New Zealand, and Margo Buchanan-Oliver Department of
Marketing, University of Auckland, Auckland, New Zealand

What is a luxury brand? A new definition and review of the literature by Eunju Koa, John P. Costellob, Charles R.
Taylorc,⁎

YouTube video : What is the difference between premium and luxury brands?

TOTAL: 20 MARKS

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