American Marketer


Why social marketing is tailor-made for luxury goods

November 26, 2013

Vijay Sundaram is chief marketing officer and head of sales at SocialTwist


By Vijay Sundaram

When the social media revolution hit, luxury brands hung back, preferring to be fearful angels rather than rushing fools. They saw inherent contradictions between luxury goods and social media.

Social media was seen predominantly as a youth phenomenon, while luxury brands tend to cater to the older and well heeled. Exclusivity – that fond pursuit of luxury brands – seemed at odds with proliferation, the defining trait of social media. So the luxury brands waited out until this new medium shook out.

Meanwhile, consumer behavior dramatically changed in a socially connected world.

According to Nielsen, 86 percent of consumers say they trust the advice of their friends more than anything else. They turn to social media to get that advice today. High-net-worth individuals are no different and are quite happy to engage with brands in social media.

Luxury and social: More alike than not
Here is a quick exercise: Read the list below. Check off the terms that describe or connote luxury goods to you:

Brand affinity, Status, word of mouth, loyal female consumers, repeat business, bragging rights, influence, tell my friends, peer recognition, deals.

Go back and read the list again. This time, check the terms that connote social marketing. The overlap should startle you.

Social media marketing offers up the audience, with the right behavioral traits, and the propensity to talk and influence others. It is small wonder that social media and luxury goods have become ardent bedfellows.

Crack social code via different focus
But luxury brands must understand how to effectively use social media. The current debate today has hardly evolved from the early issues: Which platforms to use – Facebook, Twitter, YouTube or Pinterest? How often should we post? Should we publicly reply to consumer posts?

According to a recent article in Forbes, engagement across the social media communities of luxury brands has declined. Luxury brands continue to be diffident about consumer engagement. Some such as Burberry, Ralph Lauren, Dior and Chanel do not ever respond publicly to consumer posts, even on their owned media.

The problem is that the focus is in the wrong place.

Social strategy for luxury brands is not about platforms choices, or communication policies. It is about recognizing the value of connected consumers and building brand strategies to include them.

Foremost is the ability to use customer advocacy in authentic ways that influence others positively. The media revolution in social media will be about letting others do the talking for you and your brand.

Here are some ways luxury brand marketers should undertake social marketing efforts:

Engage the customer: It’s not about check-ins or likes. It is about tying social interaction into regular customer programs such as referrals, membership drives, promotions and branding programs.

Know your advocates: 15 percent of your customers influence almost 85 percent of your marketing outcomes – from awareness, to advocacy, to conversions. They will drive your business more than any celebrity endorsement.

Your social marketing programs must be designed, ground up, to know who they are.

Be cross-channel: All communication is not social. And social is not just Facebook.

Customers talk to others in a variety of ways such as social channels, through email and other personalized ways. Your marketing programs should be platform agnostic, leaving the choice to the customer.

Measure everything: Understand the outcomes you seek including impressions, sign-ups or conversions and put in place the mechanisms to track and measure them.

Consumer-to-consumer referral links can embed information such as communication choices (Did they use Facebook? Or email?) or consumer influence (How many friends did they reach? To what consequences?).

Tie in rewards and incentives: Most luxury brands at some time or the other provide market incentives.

Many would agree that a deal mentality dilutes the brand and its perception. So luxury brands must approach this quite differently. They must tie incentives to loyalty and to advocacy. Both can be set up and precisely measured in a social world.

Use technology: Social technology platforms can institute much of the advice described above. They can design and set up marketing programs, assign and track goals, measure advocacy, and uncover a brand’s biggest advocates. There is no excuse for not exploring them today.

Knowing what not to do
Luxury brands must also be careful to avoid the pitfalls of social media strategies. Here are some of them:

Be non-discriminatory: Select the right products and pick out the right incentives and channels.

Some products lend themselves well to social referrals, including bags, shoes and gadgets. Others do not such as hygiene products and beauty enhancement. Some age groups prefer email to social media.

Be loose with privacy: Safeguard customer information and privacy. Be aware and ruthless on regulatory compliance including Bureau of Advertising requirements. Let customers know what you track.

Miss the biggest shopping seasons: Brands and retailers thrive during holiday seasons. It is the time of the year when people make and reinforce their connections.

We are fast approaching the biggest season of this year, so get advice. Find the right technology. Put forth your best social marketing strategies this holiday season. The volume will maximize not just your impact, but also what you can learn.

Vijay Sundaram is chief marketing officer and head of sales at SocialTwist, a Mountain View, CA-based social marketing technology firm. Reach him at