Approximately 69 percent of luxury marketers are expected to increase their advertising spend on online video this year, according to findings from Martini Media and Digiday.
Digital advertising for luxury brands is supposed to skyrocket this year, with luxury brands expecting to spend more on video, mobile, social media, rich media, search, standard display and connected television. Indeed, the expected growth for luxury brands advertising on digital overall is expected to be 10-20 percent.
“Digital spend was lagging behind, but now it has seemingly caught up,” said Skip Brand, CEO of Martini Media, San Francisco. “Growth for luxury marketers in digital is continuing to compound and that’s why we think we are going to see pioneers for the next movement in digital.
“That’s what we like to see, and we’re excited to see this growth, which is almost double or triple over mass marketers,” he said. “There is a lot of work in social, not only being there but with answering and participating in social media.
“We think that for a wow product, there should be wow advertising.”
Not socially awkward
Right now, the growth for luxury marketers is approximately 31 percent, as compared to mass marketers, whose digital spend is about 36 percent, according to the study.
However, luxury marketers are expected to push that growth to the next level this year.
Approximately 69 percent of luxury marketers are expected to grow their video content.
Not only do luxury marketers intend to spend more on online videos, but they plan to do so instead of television marketing.
Approximately 85 percent of marketers believe that online video is more effective than TV for driving online sales.
Also, 44 percent believe that online sales are more effective than TV for driving traffic to bricks-and-mortar locations.
About 35 percent of marketers believe that online video is more effective in building brand favorability and 18 percent believe that this platform is more effective than TV in building awareness.
Marketers including Dolce & Gabbana, Lagos, Cartier, Louis Vuitton, Burberry, Michael Kors, Marc Jacobs and numerous others have started using social video, possibly in place of TV ads (see story).
Also, Barneys New York and Gucci have taken online videos to the next level by adding a shopping element.
Ad platforms
Meanwhile, 68 percent of luxury brands are expected to increase their ad spend in mobile.
Furthermore, 48 percent of luxury marketers are going to spend more social media. This means not just with a presence, but actually answering questions and participating on the sites, according to Mr. Brand.
Marketers such as Oscar de la Renta are increasing their social media connectivity (see story).
New social media options on OscardelaRenta.com
Also, 45 percent of the same marketers intend to spend more on rich media.
In addition, 29 percent will spend more on search, 18 percent on standard display and 10 percent on connected TV.
Most marketers believe that finding high-impact rich media, video and social will be crucial elements for luxury brands.
High-impact videos seem to be favored by brands such as Omega, Cartier, Ralph Lauren and Gucci.
Ralph Lauren's high-impact media ad in the New York Times mobile app
Also, finding complementary context for each brand and engaging the right audience is also important, according to the study.
“Luxury brands should feel comfortable because they are soon to be in a situation of leadership,” Mr. Brand said.
“The mass-marketing brands were on the forefront, but luxury brands are catching up out of necessity and out of creativity,” he said.
Final Take
Rachel Lamb, associate reporter on Luxury Daily, New York