LUXURY VS PREMIUM BRAND
It’s easy for us to confuse between these two. But when it comes to branding there is a clear difference.
Luxury Brand
Luxury doesn’t meet a need or solve a problem. Luxury consumers aren’t interested in more features giving better value for money — that’s a premium marketing angle. Luxury consumers want to know about a brand’s heritage, prestige and uniqueness; it’s identity which counts, rather than a competitive edge.
They are displays of wealth that revolve around strong social cues such as social elevation, a sense of timelessness, priceless experiences and a strong hedonistic drive.
Premium Brand
Premium Brand are the ones that give you the best features at the best value. They operate with a close to one ratio of functionality and price. So since they are providing the best features and quality, consumers pay them high price for that. They feel it’s worth it.
Points of differences
Price
It maybe obvious that the luxury brands would have the higher prices, but that’s not necessarily true. They just have the high price compared to what they are offering.
Premium brand try to come up with the best value for their customers and for themselves. They are highly sensitive to competitors are the market.
Features
Luxury Brands don’t have to care about these. They can literally sell shiny rocks at the cost of a house.
Premium brand are the winners in this category. These are the ones that define the industry benchmarks for quantity and quality of their features.
Target Audience
Luxury isn’t for those who are price sensitive and do not have the appreciation of the finer things in life. Luxury is for those who want to be feel like they are ‘the one’.
Premium brands’ target customers are those who can push themselves to pay higher than what they pay for a average product. And those who already can afford and are trying to get the best product in the market.
Advertising
Have you ever see seen a Rolex Advertisement? I guess not.
Premium brands have the some of the biggest share in the advertising market. Their prices are directly related to the amount of advertising they do. These brand are also the ones who innovate and push forward the advertising world.
Manufacturing
Since luxury brands are for the top 0.1% of 0.1%. They rarely go for mass manufacturing. They take the pride in creating things by the hands of the experts and even offer high customizability to their customer.
Premium brands may not mass manufacture as much as the average brands. But they do do it a lot. While being very careful of maintaining the high standards and limiting the cost
Masstige Brands
This is the middle ground between luxury and premium.
Take the pride and prestige of the luxury.
Take the Quality and accessibility of the premium.
Bam! You have a Masstige Brand.
These brands do mass manufacture their products, they do care about the features they offer, but they also generate a high social standing for their customers.
Typical masstige brands include Zara, Coach, Godiva, Starbucks and Victoria`s Secret.
These brands may not the pure luxury, but they do generate quite a lot of cachet with their consumers, while practising as a premium brand
Now Zara is nowhere close to Rolex in it’s positioning, but it’s also not a Indian Terrain. Zara stands out of the other premium brands by maintaining a sense of luxury and exclusivity to their products but they do make efforts to attract the premium brand customers towards them. They make sure that they are accessible to their customer and try to maintain a premium brand operations like mass manufacturing and advertising.
So if you’re trying to create a brand in any of the categories. Be careful and know what you’re doing.
