The Luxury Letter Blog


February 2009: Publisher’s Note
February 3, 2009, 6:40 pm
Filed under: Uncategorized

It’s time to face the facts. Many of you will notice I have taken down the “half empty vs half full” segment because, well, things had tipped so significantly to the “half empty” side that it was time to let go. I still hold that just because luxury is down does not mean it is out, but it has come time to face the facts and assess the situation at hand. Adcision Luxury Media, the publishers of this newsletter, found this sobering yet informative article by Unity Marketing on Marketwire. Their latest survey of over 1,000 affluent customers found, not surprisingly, that the nations richest shoppers are continuing to cut back on luxury indulgences and plan to put money that would normally have been put toward lavish items, vacations, and services will be put into savings in 2009.

What does all of this mean for luxury marketers’ prospects for 2009? Thomas Bodenberg, Unity Marketing’s chief consumer economist, says, “If we look at the LCI (Luxury Consumption Index) results in a positive light, the downward spiral in the past several quarters has leveled out. At the same time there are a number of key factors behind the index that continue to moderate the affluent consumers’ outlook. For example, the collapse of the credit markets and the inaccessibility of easy credit has hindered the financing of major discretionary purchases.” He then goes on to explain that, “consumers, even high-income consumers, are allocating spending to ‘essentials’ like housing, food and healthcare, while cutting discretionary spending.”

A related article by GLG News titled “The Future of Luxury,” explains that, “There will be companies who will struggle in all segments (accessible luxury, independent brands and global luxury brands), while others will thrive. This is a good thing. Joseph Schumpeter called it creative destruction; the process whereby sleeping giants are replaced by innovative upstarts over the longer-term.” The article theorizes which luxury brands will make it through the recession and which ones will disappear altogether and whether or not this is a “cyclical downturn” or “a more permanent ‘structural correction’.” The article on a whole brings to the table some interesting questions but offers hope that many brands will be able to cope with the situation.

We encourage our readers to continue to weather the storm and find new and inventive ways to market your product or service to be fitting with the current economic times. Check out the article below on what Neiman Marcus is doing to appeal to their most loyal customers for an example of how they are thinking with the times. Sit tight, look toward the future, and use the resources you do have to your advantage.

Click here to view the full study by Unity Marketing.

Click here to view the full article by GLG News.



Luxury Hotel Marketing and Price Warfare: 2 Schools of Thought
February 3, 2009, 2:42 pm
Filed under: Uncategorized

By Monique Smith, Senior Adviser, Criterion Global


In this global downturn, even consumers richer than Midas are taking a deeper look, and more carefully weighing purchase decisions – much to the discomfort of marketers worldwide.
Every luxury brand fears the critical eye of the newly frugal consumer, but the tests of time have shown advertising is an indispensible necessity in recession. The famous formal test by McGraw-Hill in the 80’s, oft-remembered by marketing professors at UPenn’s Wharton School of Business, showed that brands that continued or increased advertising during the 1981-1982 recession experienced an avg. increase of 256% in post-recession sales, over those who didn’t.
But how much should the tenor of the time temper the tone – and message – of advertising? And how effective are price promotions? So often, two schools of marketing emerge in rough waters: that of the “Drop It Like It’s Hot,” and the “Quid Pro Quo” philosophy of added-value.
The “Drop It Like It’s Hot” approach means cutting room prices– this is the knee-jerk response to weakening demand. The “Drop It Like It’s Hot” price cut is tempting, particularly in times when headlines everywhere seem to broadcast the sinking prices of milk, cars, homes – you name it. But do price cuts motivate luxury travellers?
Low-balling your comp set a) signals emergency, b) slims down profit margins and RevPAR, c) gives guests a sense of “real” or “bottom” prices – prices which they will inevitably expect, even if subconsciously, when times are good again. To quote Terry Jicinsky, senior vice president of marketing at the Las Vegas Visitors Authority, “You don’t want to build a brand in today’s market based solely on a price that backs you into a corner.”
Finally, slashing prices doesn’t necessarily bring about a surge in demand.
Consider a “Quid-Pro-Quo” value-add strategy, which presents the consumer with greater value for their dollar. For example, a value-add promotion might offer a year of concierge service with the purchase of a condo; or free theatre tickets with hotel booking. Value propositions are:
•    Consistent with luxury brands: price cuts aren’t. Luxury is based on the premise that quality, not price, is the primary motivator.
•    Value-add packages flaunt offerings, and increase the total dollars spent on-site.
•    Value-add packages can also be more profitable than price cuts, particularly when partners (such as spa, theatres, etc.) can absorb some, if not most, of the cost of the freebies.
•    Motivates buyers more than price cuts alone, as it adds more “meat” to consumers’ choice. What is more appealing; a room with a free spa service, and free appetizer at the restaurant; or a 20% off coupon?
Added value marketing presents travellers with a greater sense of choices. Jitendra Jain, thought leader E-Commerce Manager at Starwood Hotels & Resorts in Dubai, is gaining a following for this groundbreaking choice-based theory of hotel marketing. Jain’s concept of the “Experience Engine,” allows guests to “build” individualized experiences by bundling “experience units” (meals, spa service, sports diversions, etc.). Personalizations, and freedom of choice, will become the new luxury, replacing the Amenities Races of years past. Until Experience Engines are status quo, intelligent e-marketing of value-add incentives can offer guest personalization and generate ROI.
For instance, incorporating dynamic content delivery into your booking site will customize your conversion process for each visitor, increasing conversions. Smart online media buying can target specific promotional ads based on behavioural cues, catalysing your prospecting, increasing conversions, while accurately measuring response and returns on your marketing investment.
Before jumping to make rash price cuts, incorporate value-oriented marketing strategies to outmanoeuvre your comp set while maintaining your hard-earned luxury brand stature.



Publisher Spotlight: Boston & Philadelphia Magazines
February 3, 2009, 2:37 pm
Filed under: Publisher Spotlight | Tags:

This month we are featuring Boston and Philadelphia Magazines.  The sites provide valuable and interesting information to visitors to the two cities from where to eat, shop and stay to what to do with your time.  Ian Zweig gave us some insight into the two sites.  Check out his answers to our questions here.

Biography:
Ian Zweig is the Online Marketing Manager at Metro Corp, publishers of Boston Magazine and Philadelphia Magazine.  He has spent his entire working career in the online advertising field helping companies grow their web business.  Ian received his Bachelor’s and Master’s degrees from Boston University.

Adcision:  Please describe a typical visitor to your site — what he/she is like, what motivates them to visit, what engages them while they are there.

Ian: Since we own two City/Regional Magazine websites, a typical visitor comes to our site for lifestyle information.  They want advice on where to dine, the scoop on the fashion scene and the VIP insights on events.  In sum, these are the socialites of Boston and Philadelphia.  They come to our site with a certain mindset, which enables us to engage them in a personal manner.  They don’t come looking for general news, sports or weather, our readers come to plan their dinners, weekends, social activities, and shopping escapades.  Our highly qualified audience sees our site as a destination based on our expert advice and recommendations.

Adcision: Do your sites have any unique features that you’re proud of?

Ian: I’m proud of every part of our sites.  The largest asset to our site is the flexibility in programs offered and ability to work with our advertisers.  As with many sites, we offer the standard IAB ad displays or newsletters, but in addition we offer insightful customized programs for our users.

Adcision: What do you wish more people knew about your “publication”?

Ian: Our magazines provide a local perspective that is independent and authoritative.  We understand that our online audience wants information fast and easy.  As long as we continue to respect our readers, we provide a great advertising channel to reach consumer through a trusted environment.

Adcision: Have you heard of any interesting transactions that have occurred as a result of your site?
Ian: The most recent testimonial we received came from one of our Wedding advertisers.  Here’s the story: Our wedding section has a place where the newly-engaged can post their engagement on our site.  We have a company who sponsored this section of our site to reach brides and soon-to-be brides early in their wedding planning process.  By being contextually relevant in the wedding section, and connecting with the mindset of the users, our sponsor was able to land two deals in their first month.  Nice story, huh?  Here’s the moral: When we create customized campaigns we try and align content and mindset to connect our users and sponsor.  It’s easier to drive results that way.

Adcision: How do you get your content?


Ian:
All of our content is created by our dedicated, hard-working, sagacious staff of writers and editors.  All of our magazine content is put online.  Additionally, online editors are the backing to our rich database of listings, our original blogs, and other online packaging.

Adcision: What’s the best article (or feature) that you have ever run on your site … and why do you think it was so popular (Please include a URL if possible)?

Looking back at 2008, our most popular feature article on Bostonmagazine.com was ‘Best Places to Live’ (http://www.bostonmagazine.com/articles/the_best_places_to_live_2008/ )and the most popular feature story on Phillymag.com was ‘Single in Philly’ (http://www.phillymag.com/articles/single_in_philly_where_is_the_love/).  I think these two articles were particularly popular because they contain intuitive, fresh content that you can’t find anywhere else.  It shows that we know how to connect with our readers in a timely fashion with stimulating content.  Also, we allowed our readers to engage with the content not just by reading the text, but by creating interactive slideshows that organized all the information in a user-friendly, fun fashion.  Talk about alliteration…

Adcision: Please share some demographic information about your audience (i.e. average home value, average HHI, male/female ratio, etc.)

Male/Female – 45/55
Avg. HHI – $115,000
Avg. Age: 38
Top Hobbies: Dining, Traveling, Performing Arts, Shopping, Socializing

We did also ask our readers to provide their credit card limits, but you’ll have to take me out for lunch to find out that highly coveted information.


Adcision: What is the best source of traffic on your website?

Ian: The most popular section on both our websites is ‘Best Of’.  Every year our editors choose winners in hundreds of categories ranging from ‘Best Brunch’ to ‘Best Party Dress’ selection.  Our three other heavy hitters are the main lifestyles sections: Dining, A&E and Fashion/Style.

Adcision:  Is there anything else you would like to add?
Ian: Of course, thanks for asking.  I would like to emphasize that looking for your target audience doesn’t mean looking at the largest websites. It means looking for the right people who you feel will buy your product.  Doing the extra work to figure out where your customers are online will pay dividends and make you look like a superstar when you show the results to the boss.  It’s amazing how a little extra work can go a long way.



Publisher’s Note Putting a Face to a Name: LinkedIn as a Sales Tool
January 7, 2009, 3:11 pm
Filed under: Uncategorized | Tags:

linked in logo

It is easy to pretend the voice on the phone is not a real person.  In sales, one of the most effective things you can do is to put a face to a name and voice.  Adcision Luxury Media, a online luxury advertising agency and publisher representation firm and the writers of this newsletter, have spent some quality time exploring the many tools and resources that social networks, specifically LinkedIn, provide and have found them to be tremendously useful.  From identifying appropriate contacts to joining groups and finding potential clients, LinkedIn is more than just an avenue for finding a new job or connecting with old colleagues.

Most valuable of all appears to be the groups.  From corporate and alumni groups to common interest, it is easy to post discussion questions, relevant news articles and meet others who are in your profession or share common goals.  Here are a few Adcision has joined and recommend for those in the luxury space:

-Luxury and Lifestyle Professionals-(12,560 members)- Managed by Lionel Crochet.  This group does an excellent job controlling the discussion boards and posting relevant content.  Lionel tells us that, “luxury and lifestyle industries cover a lot of connecting business from travel to fashion, jewelery, architecture, design or transportation for instance. I figured those industries and its professionals collaborate enough to create a need for online networking. This may allow businesses and their associates to create bridges, ventures, deals or collaborations. Sites like LinkedIn, Facebook, Ning or MySpace where the Group is present are meant for that and I hope our cheer number of members make more and better business thanks to “Luxury & Lifestyle Professionals.”

-Luxury Interactive- (57 members)- Managed by Steven Peters.  This small targeted group will be an excellent tool for networking pre and post show for both London (March 2009) and New York (June 2009).

-The Luxury Letter- We decided to form this group for our members and encourage you all to sign up.  The goal of this group is to create a controlled environment for you and your peers to exchange dialogue.

If you are a member of a group that you feel others would find valuable, please let us know by leaving a response on The Luxury Letter blog!



Are You Maximizing Your Opportunities Online With High Net Worth Buyers?
January 7, 2009, 3:10 pm
Filed under: Uncategorized | Tags:

By Susan Adams, President of Fractional Sales Solutions

I was on an interesting webinar a few months ago that was sponsored by Google. The topic was how the affluent use the internet. I’m of the opinion that the internet is the least understood of the marketing mediums for those companies that actively sell to high net worth buyers.
The most interesting statistic from their survey was that millionaire earners are the most prolific shoppers on the internet. The reason I found this so compelling was that many wealthy shoppers are given exceptional service experiences from the retail stores they visit. So, why would they abandon these stores that cater to their needs to go shop on the internet?
It’s simple. The internet is fast and anonymous. One of the things I learned in my years of selling to multi millionaires is that they prefer to be anonymous. Most of my contact with these clients was over the phone. They rarely wanted to meet in person, and instead, preferred to speak with me over the phone.
It only makes sense that they would be attracted to the internet because of the anonymity they find using this medium. They can research a product or service from the comfort of their home or office without ever having to get on the phone and talk to a sales person. In fact, one gentleman in the survey found a $15,000 watch he wanted to buy and was completely annoyed that he couldn’t purchase it online. Instead, he had to call and speak with a sales person.

Money to Spend, But No Time to Spend It

The second interesting fact concerned the amount of time (or lack thereof) they discovered among the various groups of ‘affluents’. The more money a person has, the less time they have to spend it. This is a point I make repeatedly with my clients trying to market online to the affluent. We know they lead busy lives and have very little personal time. So, it makes sense that their first stop for any major purchase is the internet.
It’s important to remember that the average consumer spends 7 seconds on a website before they click away. While there are no statistics of this kind for the affluent niche, you can assume 7 seconds may be generous. With that in mind, take a look at your online presence. Does your home page immediately connect with a high net worth individual?
For example, if you’re a luxury resort, are you talking about family experiences, or are you highlighting the spa or the golf course? The affluent are more family-oriented than other demographic groups, so lifestyle experiences that speak to connecting with family are more likely to resonate than a description of the ‘world class spa’. If you’re wealthy, you have world class accommodations everywhere you vacation.
There were a few other important findings for marketers:

  • The affluent believe that those companies NOT FOUND online have cheapened their brand
  • The wealthier you are, the more likely you’ll be annoyed if you CAN’T find and purchase something online
  • Brand awareness isn’t enough…you must have data to support the prospects’ need for due diligence
  • Peer recommendations (testimonials) are a powerful tool among the wealthy. They all want to know, ‘Why are other people like myself buying this or looking at buying’?

Companies also need to think beyond their websites and look into other, more nonconventional, areas for advertising. I frequently remind clients that their online presence needs to go beyond websites and pay-per-click advertising.
For example, have you ever considered some of the places wealthy buyers are likely to go on the internet? Places like social networking sites, blogs and charity sites? What better place to get acquainted than a blog on a specific charity?
There are also many ‘cause-oriented’ sites like the green movement or political sites.
As with any marketing or advertising, it all goes back to understanding WHO your client is and how WHO they are helps you effectively market to them. Your marketing message shouldn’t be telling the prospect what you think they need to know, but rather finding out what they need to know about you and then crafting a message that resonates.


Why not attract the affluent with a message that says, ‘We understand who you are and why people like you purchase this product or service’.
Different? Yes.
Effective? Definitely!



Publisher Spotlight: Deal Breaker, Above The Law, and Fashionista
January 7, 2009, 3:05 pm
Filed under: Publisher Spotlight | Tags:

by Hibben Silvo, Editor

This month we are featuring not one but three new publishers, Deal Breaker, Above the Law, and Fashionista, all published by Breaking Media.  The three sites provide valuable and interesting content to visitors with an enthusiasm for business, law, and fashion.  Breaking Media’s Publisher, David Minkin, gave us some insight into the three sites.  Check out his answers to our questions below:

David Minkin’s Bio: After graduating from Brown University I went to work at Forbes.com in ad operations.  From there I went to CFO.com where I managed business operations then later east coast ad sales.  From there I proceeded to run online sales at Institutional Investor and then finally left there after co-finding Dead Horse Media (later known as Breaking Media).

Adcision: Why did you launch Deal Breaker, Fashionista and Above the Law and what need has it fulfilled?

David:
Breaking Media has launched and operates three sites including DealBreaker.com (launched 3/06), AboveTheLaw.com (launched 8/06) and Fashionista.com (launched 1/07).    DealBreaker launched with a mandate to bring a new edge and independent voice to financial news with content aimed specifically to professionals in the finance industry.  The content is meant to be insightful, groundbreaking, funny and to challenge the conventional wisdom.   After seeing such success with DealBreaker we later rolled out AboveTheLaw, which caters to the legal industry.  Later we launched Fashionista.com, which isn’t quite as industry focused, but is still very insidery.

Adcision: Which three brands are you the most proud to have run on your site?

David: Target, Bloomberg, British Airways

Adcision: If you could only have one advertiser on your site, which would it be?

David: Target – I love them. Beautiful creative and the team at their agency is a pleasure to work with.

Adcision: Give me an example of something your readers discovered on your site that they probably wouldn’t have known about otherwise.

David: In terms of DealBreaker and AboveTheLaw we routinely scoop other sources with bonus compensation data (which is obviously very important to our audience).   And on Fashionista we announced Arlenis Sosa as the new face of Lancome literally weeks before any other source.  We’re good with getting scoops.

Adcision: Please describe a typical visitor to your site — what he/she is like, what motivates them to visit, what engages them while they are there.

David: Of course the typical reader depends on the site.  With regards to DealBreaker and AboveTheLaw the average reader is 30, extremely affluent and very well educated and most likely male (this is especially true on DealBreaker).  Fashionista readers tend to be around 25 years old, relatively affluent and very cosmopolitan.  Across all three sites about 40% of our readership is in New York.

Adcision: What do you wish more people knew about your “publication”?

David: The Breaking Media sites are the go-to destination to reach a young, upscale audience of professionals in major cosmopolitan areas.  Very few sites have such a high concentration of these influential players.  I want brands to know that we excel at engaging this audience and we do it successfully day in and day out.

Adcision: Can you namedrop… any well-known persons engaged with your site?

David: We once received a letter from Warren Buffet’s assistant disputing an argument we put forward on DealBreaker.com.

Adcision: What is the best source of traffic to your website?

David: Google.  But we’re regularly linked to by all major publications that cover fashion, law or finance.

Adcision: How do you get your content?

David: We have an incredible team of editors who are very networked within their respective industries.  A lot of our larger scoops come from tips sent in by our readers which are then corroborated by the editors.

Adcision: What’s the best article (or feature) that you have ever run on your site … and why do you think it was so popular (Please include a URL if possible)?

David: DealBreaker’s http://www.dealbreaker.com/2008/10/dear-investor.php post is great because it demonstrates the type of information that many financial institutions wish was kept hidden.  In many ways it’s this sneakiness among institutions that led to the financial mess we’re currently in.  One of the goals of DealBreaker is to shine a light on the darker corners of finance.

And of course I love that we broke the “Arlenis Sosa as face of Lancome” news on Fashionista.

http://fashionista.com/2008/09/confirmed_arlenis_to_lancome.php

Adcision: Please share some demographic information about your audience (i.e. average home value, average HHI, male/female ratio, etc.)

DealBreaker readers: 89% male, median age 30,  $246k average HHI
AboveTheLaw readers: 64% male, median age 30, $143k average HHI
Fashionista readers: 94% female, median age 26, $71k average HHI

Adcision: What is the most vexing issue facing your business right now?

David: Although we reach a very valuable audience because our readership is so niche we’re too small to be listed in @plan and thus we miss out on many RFPs from the big agencies.  Also, some of the more old school brands still think “blog” means a guy sitting in his pajamas writing in his mother’s basement.  These brands don’t realize that Breaking Media has 10 full-time employees on staff and is funded by a team of investors.

Adcision: Other than your own, what are some favorite luxury oriented sites you like?

David: These sites aren’t explicitly focused on luxury but I enjoy theatlantic.com and nymag.com

Adcision: What is your definition of luxury?

David: Something inessential but conducive to pleasure and comfort. That also happens to be the American Heritage Dictionary’s definition.

Adcision: Where do you see the industry headed?

David: I think online publishing in general will have some interesting growing pains as display advertising (in the form of standard banner units) because less valuable to advertisers.  Where that leads I’m not sure…

Adcision: What are your goals for 2008?

David: To make our sites the go-to destination for people wanting the inside scoop on the finance, legal and fashion industries.



Adcision’s 2009 Predictions
December 9, 2008, 2:44 pm
Filed under: Uncategorized

by Hibben Silvo, Editor

2009 is going to be big on two things: unknowns and opportunities. 2008 has been a challenging year and 2009 is upon us with plenty of question marks and furrowed brows. To help with this, the best course of action is to develop solid educated guesses, better known as predictions. To get the ball rolling Adcision Luxury Media, a luxury oriented online advertising agency and publisher representation firm, and the publishers of this e-newsletter, have developed our own. We hope that these encourage our readers to think outside the box and help to provide encouragement in these difficult economic times.

Adcision has asked several industry experts to weigh in on our predictions including: Melissa Vigo (Sapient), Amanda Ross (Vivre), Michael Keaveny (Razorfish), Adam Broitman (Crayon), Meryl Macune (Estee Lauder Companies), Rebecca Matt (Morpheus Media). Read their reactions to our bold predictions below and leave your own 2-cents:

1. 2009 is the year for Online Luxury Advertising: Despite an overall decrease in online display advertising, luxury brands/services will fare better than other markets. With loyal clientele and 56% of millionaires preferring to shop on a retailer’s website, luxury online advertising will endure (Shopping Secrets of American Millionaires, Media post).

2. Old School Online Advertising Meets New School Online Advertising: Social media, Web 2.0, and viral marketing campaigns will partner with traditional display advertising for more effective and well rounded campaigns

3. Obama will inspire more than just political change: The success of Obama’s use of online promotion will inspire those not already participating in online advertising to jump on the bandwagon and those already running campaigns to increase their online budgets

4. Beauty isn’t just skin deep: A new emphasis will be placed on the creative and being creative. Simple display advertising will no longer be enough; campaigns must be both attractive, eye catching and well planned from placement, to creative to how the entire campaign comes together

We asked people in the industry to offer their opinions on our predictions based on their own personal experience and got some great responses. Below are a few of their insights:

1. Do you agree/disagree with these predictions? Which ones in particular?
Why?


Adam Broitman, Director of Strategy at Crayon and Author of A Media Circus

“There are generally two types of luxury shoppers (at a very high level)—the undeniably affluent and the aspirational. It is hard to say if luxury marketers will see significant growth online, as the category may experience a drop in spending by the aspirational segment. With that in mind, there is no doubt that spending in this segment will grow, as it should follow internet adoption trends—which is led (to a large degree) by those individuals with above average means. “

“I have every confidence that all marketers will be much more aware of the impact of social media in 2009. My prediction is that, by the end of 2009 most marketers will have dipped their toes in the water, and will have learned a few lessons:

· Social Media is not a strategy unto itself—it is a part of a 360 holistic, integrated strategy
· Content leads to conversation—if you don’t give people something to talk about, they will not talk
· Social web strategy needs to be distributed—you can’t just place a banner on Facebook, or build social elements to your site. You need to do both; all in the name of an overarching strategy

Ultimately all media is social. By mid 2010, social media will be an integral part of all marketing campaigns (including traditional marketing) for all seasoned marketers.”

Melissa Vigo, Associate Media Director at Sapient
“I would have to agree with all of the predictions stated above. I highly agree with the prediction of “beauty isn’t just skin deep.” It’s all about the “first impression” when you see an ad. If it interests a consumer and they can relate to it, then they’ll interact with your brand. “

Amanda Ross, Senior Online Marketing Manager for Vivre
“I agree with all of the statements…with the economy, etc, businesses will need to turn to the more cost effective media of the online channel, as well as really begin to penetrate the mobile and smartphone marketing space. Furthermore, working in the online space for over 6 years now, I agree with the new school advertising model as taking precedence, as the internet has become an oversaturated commodity and people are hungry for innovation, personalization, and intelligent communication.”

Susan Adams, President of Fractional Sales Solutions
“I agree that online advertising will be the new way to reach the affluent. As people acquire wealth, they have less time for everything. The super affluent have personal assistants, private jets…all designed to give them more time and make their lives easier. That’s why they use the Internet. It’s easy and it’s anonymous. They can gather information without ever talking to a sales person.”

Meryl Macune, Executive Director of Online Marketing and New Media for Estee Lauder
“I agree with point one in that luxury brands will continue to utilize the internet to further engage consumers by being able to truly target this customer in more niche, upper end, luxury sites.
I also agree as the Internet and other alternative digital platforms become a more integral part of users lives, brands will look to integrate all elements of a campaign via Internet and offline traditional media such as print. Lastly, agree that brands have to think beyond the simple display advertising to give a consumer a reason to engage with your brand.”

Cal Simmons, Founder and CEO of Adcision Luxury Media
“Although there is an overall downward trend in advertising, the flexibility and targeting that online advertising can allow luxury brands leads me to agree that they will fare better than other forms of advertising. It will no longer be enough to simply have only display ads. Campaigns will be planned to include display, sponsorship opportunities, blogging, and other ‘outside the box’ advertising. One must cover all their bases and reach in multiple directions to be truly successful.”

Michael Keaveny, Media Supervisor at Razorfish
In reference to #3 – “Yes, the Obama campaign’s success with online promotion will help to re-affirm the space for some, and legitimize its value for others. Social media, especially Facebook, may have opened eyes and proven itself the most as a result.”
In reference to #4 – “Yes, it is increasingly difficult to stand out with digital display advertising. Just being there is not enough. The channel is getting more crowded and consumers are utilizing a more fragmented mix of properties.”

Anonymous, Media Planner
In reference to #2 – “Disagree – When it comes to luxury audiences, I’m not sure if any advertisers have figured out exactly how their audience is using social networking and UGC. Our audience is a lot different than the usual Facebook/Myspace crowd. So it becomes twice as hard to come up with a sound program that integrates the new Web with old media.”
In reference to #3 – “Disagree – I think advertisers look at Obama’s campaign in a vacuum. It occurred with a much broader audience and with different objectives. Most political pundits point to a wide variety of reasons why Obama won (i.e. the economy, Bush’s low ratings), and I don’t think anyone gives the online marketing the credit it deserves.”
In reference to #4 – “Agree – This should and always be the case. But it gets harder as new technology enables new types of advertising. Hopefully luxury advertisers are willing to take a chance with their creative and utilize these new technologies, but that remains to be seen.”

Rebecca Matt, Senior Account Strategist for Morpheus Media

“I definitely agree with all of these predictions. I particularly agree with number 1 as I think there has been a lot of research to support the fact that despite a downturned economy, luxury shoppers are still shopping. While they may not be spending AS much, they are still spending. Additionally, the research I have seen has shown that not only are these people still shopping but if the brands that they love increase their advertising in a downturned economy their consumers not only remain loyal but that brand is much more likely to have an increase in profits after the recession.”

Tanya Ryno, Publisher of Lift Magazine
“I agree … Luxury brands can re-create a similar online scenario online as in the offline world. They can communicate the brand messages through high-end creative emails, online ads and page sponsorships and build a luxurious virtual presence through a website or micro site. This is what sets them apart offline, they are able to create an experience … it’s not so much the product as it is the experience that makes the luxury brand luxury and I believe online is perfect way for them to extend their brand.”

Matt Simrell, Director of Business Development at US Connoisseur, Inc.
“I agree that online ad spending will gain in dollars. Print will still, as always get the lion’s share of luxe ad dollars. I think that the shift in budgets from print and other “traditional” media to online interactive campaigns will be logical in the minds of those who are directing the funds. This is because it is “instant gratification” in terms of tracking. This makes answering the age-old question “is it working?” much easier to answer.”

2. What changes are your client’s making when planning 2009 campaigns?


Melissa Vigo, Associate Media Director at Sapient

“I’ve been seeing more of a shift in media dollars going towards online marketing and away from traditional media methods. There are a lot of talks around web 2.0 especially for brand awareness focused clients. Employing a viral strategy allows advertisers to get a greater bang out of their marketing dollars. A lot of our clients are also testing targeting technologies such as behavioral and re-targeting.”

Michael Keaveny, Media Supervisor at Razorfish
“In our challenging economic environment, clients are more than ever are looking to spend their budgets wisely. There is a greater emphasis on efficiency, and we are expecting a lot from publishers. Our assumption is that they can be increasingly accommodating during these times.”

Susan Adams, President of Fractional Sales Solutions
“Many are changing the demographics they market and sell to. The Millionaire Next Door is not buying right now, so if that’s your target group, you need to move up to a different demographic.”

Cal Simmons, Founder and CEO of Adcision Luxury Media
“Both targeting and innovative sponsorship opportunities have been popular, efficient and budget friendly options for many of our advertisers. Many advertisers are looking for new markets and publishers that are perfectly targeted to their demographics and offer both traditional display advertising and outside the box opportunities. Others, such as Estee Lauder, have purchased ‘skins,’ sponsored advertorials, and roadblock campaigns to make the most of their online advertising budget.”

Rebecca Matt, Senior Account Strategist for Morpheus Media

“I think what we are seeing with our client’s is that while with some there is still a willingness to try new things, we are really sticking to the tried and true publishers. So we are still advertising but really focusing on what we already know works.”


3. Do you have any predictions of your own?

Adam Broitman, Director of Strategy at Crayon and Author of A Media Circus
“A recent article in the LA Times spoke about the role of intimacy in luxury marketing. Given that the luxury market is small, marketers have always needed to cater to the needs of as many individuals as possible. That has never been more true than it is today. Luxury shoppers are still buying, but they will be more selective—those marketers that know how to build relationships will win the game.”

Melissa Vigo, Associate Media Director at Sapient
“Mobile Marketing – Will play a bigger/better role in 2009, whether if it’s reaching a consumer through SMS marketing or mobile web ads. Mobile ads tend to have higher click through rates making it a great opportunity to reach consumers on the go..
Targeting Technologies – There is such a variety of targeting technologies available to advertisers such as behavioral, re-targeting, content targeting and others. Advertisers need to understand their target audience and what their online media habits/behaviors are.”

Michael Keaveny, Media Supervisor at Razorfish

“In the long term, sites that cater to luxury brands will be increasingly challenged to offer more large creative sizes without being interruptive to the user. Things have come a long way, but this will be necessary to compete better against print for share of luxury advertising budgets.“

Susan Adams, President of Fractional Sales Solutions
“I think those companies that do target marketing to the affluent will be much more successful. To simply keep thinking, ‘they have money and can afford what we sell’ isn’t a sound strategy. The affluent are a complex group and if you understand their buying motivations, you’ll be much more successful in a tough economy.”

Cal Simmons, Founder and CEO of Adcision Luxury Media
“Tightened advertising budgets will inspire a major luxury brand to jump out ahead of the crowd with an innovative, provocative campaign fully utilizing the interactive nature of online advertising. This will create huge buzz. We don’t know who it will be, but we do know that more and more luxury brands are embracing online and looking for creative ways to tie in social media and engage their clients in a broader conversation.”

Anonymous, Media Planner
“I think display advertising will continue to slump, as it becomes harder to prove its worth against more proven methods like search. Just like TV, users are also becoming immune to display advertising and unless sites find a more unique way to engage users with advertisers, CTR’s will continue to fall.”

Rebecca Matt, Senior Account Strategist for Morpheus Media
“I think with Obama in office we will see in upswing in our Economy. I also think that just as a wave of the future and with the increase of phones like the iPhone, that more people will spend their advertising dollars online. Print will never go away, it just won’t, but I think we will see less of it. I think that people are starting to realize what great things you can do online and how trackable and accountable you are for it. It really is a better bang for your buck.”

Tanya Ryno, Publisher of Lift Magazine
“The sensorial customer experience that is created in a store will be re-created and controlled on the website: thanks to the visual and sound experience, the usability, customer service and customization, will make the Internet a success for luxury brands. I don’t know how they’ll do it, but I imagine that ads will become much more interactive. Example: You may be able to have an online chat with someone about a product immediately by clicking on part of an ad … you you may be able to purchase directly from an ad … I’m not really sure, but it will be cool whatever it is!”

Matt Simrell, Director of Business Development at US Connoisseur, Inc.
“My prediction is that luxe spending in online and interactive will increase substantially over 2009. I think that it will be a learning experience for all. I have the feeling that this online advertising will “spurt” more talk and activity than actual sales dollars as a result. You must realize who your target customers are, and where to find them.”




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