Over the last two years, many of the leading luxury brands have undergone significant changes in their leadership, either at the CEO level, the creative director level, or both.
This means that an influx of people are bringing their experiences from other luxury brands, or in the case of the CEO of Chanel, Leena Nair, from other industries and disciplines (Unilever/HR). With such moves comes the injection of new ideas or best practices.
I am often asked about the “best practices” in luxury, and to me, it is one of the most misleading and dangerous terms. Many companies cling to the concept of best practices as their navigational north star. This approach, characterized by emulating industry standards and replicating the successful strategies of market leaders, is generally seen as a safe path to operational success.
However, in the high-stakes world of luxury, where uniqueness, distinctiveness, and exclusivity drive desirability, this strategy can be not only ineffective but destructive. Luxury is about being one-of-one, not copying what others do.
Following “best practices” is generally seen as a safe path to operational success. However, this strategy can be not only ineffective but destructive.
Luxury brands thrive on their ability to inspire, captivate, and differentiate. The very few best brands offer unique experiences and personal connections that resonate with deep-seated desires for distinction and identity. These brands understand that luxury is not about an inside-out view of the brand but how their clients feel.
The most critical driver of extreme value creation is brand storytelling, something that many luxury brands are actually getting worse at (see Gucci, Balenciaga, Burberry, and Chanel, to name a few).
In cases where the brand story becomes blurred and best practices are desperately sought after, the result often becomes average, reaching only the minimum common denominator. From a client’s perspective, this is catastrophic: brand stories morph into category stories, essentially becoming indistinguishable from one another, and brand experiences become category experiences.
Downfall by conformity#
When luxury brands adopt generic best practices without considering their alignment with the brand’s unique narrative and strategic vision, they risk diluting their distinctiveness. This paradox is where best practices can lead not to brand elevation but to brand erosion.
The allure of best practices in luxury can be seductive. They offer a seemingly foolproof way to match the operational excellence of leading brands. However, what works for one brand may not suit the unique context or customer base of another.
Luxury brands, with their rich heritage and exclusive appeal, need to be wary of becoming just another option in the marketplace. Conformity breeds predictability, and in luxury, predictability is the enemy of desirability.
Conformity breeds predictability, and in luxury, predictability is the enemy of desirability.
I recently had a conversation with one of the world’s leading luxury brands regarding the most effective KPIs for measuring client success. My answer was to forget the concept of generic best practices. Instead, I suggested they measure how well their clients understand, value, and act on the brand story, in addition to evaluating the empathy displayed by their staff in conveying these narrative elements and anticipating client desires and needs.
It is imperative for brands to ensure that their story comes across and leads to desirability and that their staff deliver on core values. And these values should be different for every brand.
In lieu of ‘best practices’#
Instead of following best practices, luxury brands should have a laser-sharp focus on four areas to close the gaps they have in their unique perspective and core values.
First, as stated above, every luxury brand has a story, but not all succeed in telling it in a compelling and unique way, often defaulting to category stories. Authentic storytelling involves ensuring that the narrative resonates emotionally, differentiates the brand, and enhances its perceived value.
Second, luxury is about the perceived experience rather than just the product. Brands must continuously innovate in how they engage with customers, offering new and unexpected ways to experience the brand. Training is one of the most critical aspects of brand success, yet most brands significantly underinvest in this area, which haunts them when staff turnover at the point of sale is high.
Third, assess your ability to hyper-personalize. One size does not fit all in luxury. Hyper-personalization goes beyond customization. It involves understanding and anticipating the needs and desires of each client and crafting services and products that cater uniquely to them, thereby enhancing the extreme value proposition.
Fourth, in today’s world, luxury consumers are increasingly aware of their environmental impact. Sustainable practices can be a significant differentiator, but only if they are not just lip service.
In a competitive landscape that can be best described as a “sea of sameness,” luxury brands need to encompass bold, unique, and distinctive strategies that resonate deeply with clients. They must dare to defy the conventional, embrace their unique core values, and continuously innovate to craft unforgettable experiences that are extraordinary.
This is an opinion piece by Daniel Langer, CEO of Équité, recognized as one of the “Global Top Five Luxury Key Opinion Leaders to Watch.” He serves as an executive professor of luxury strategy and pricing at Pepperdine University in Malibu and as a professor of luxury at NYU, New York. Daniel has authored best-selling books on luxury management in English and Chinese, and is a respected global keynote speaker.
Daniel conducts masterclasses on various luxury topics across the world. As a luxury expert featured on Bloomberg TV, Forbes, The Economist, and others; Daniel holds an MBA and a Ph.D. in luxury management, and has received education from Harvard Business School. Sign up for his masterclasses at the Jing Academy. Follow him: LinkedIn and Instagram.
All opinions expressed in the column are his own and do not reflect the official position of Jing Daily.