Luxury marketers aim to make advertising hit the target

Luxury goods makers are taking advertising cues from some humbler products these days, as a robust market for sumptuous living also creates greater competition.

The challenge, say advertising executives, is refining techniques that target specific customers, as luxury marketers generally employ budgets that pale in comparison to the stature of their brand names.

"We have to be as targeted as we possibly can for luxury brands," said Andrew Sacks, president of AgencySacks, which handles work for Cartier and the Peninsula Hotel Group. "It doesn't take a lot to change the fortune of the business ... it could be affected by the shopping habits of 100 people."

Defining those brands anew, and building experiences around them, have become favoured tactics, as seen in a new campaign from The Leading Hotels of the World, a marketing organisation for 400 top hotels worldwide, from the famed Ritz in Paris to the Plaza in New York City.

The ads are the first major brand effort from Leading Hotels in five years, tailored to highlight the aspect of travel most valued by each readership, whether it is the food, the decor or the culture surrounding their lodgings.

"We think of ourselves today more and more as a brand," said Marshall Calder, Leading Hotels senior vice-president of marketing.

"One of the reasons we liked this campaign is we wanted it to be permutable so it could support marketing ... to various niche markets."

Print ads appear this month in specialty magazines such as Architectural Digest, Gourmet and Conde Nast Traveler. In each ad, a collection of snapshots offers colourful glimpses of the good life, from a lush golf course to seaside meditation.

Sacks, whose firm created the US$3 million ($4.2 million) campaign, said it also reflected a trend of modular advertising that could change with time yet still deliver a consistent message for a brand.

Calder said five-star hotels had seen their business suffer less because of tensions over war in Iraq, or natural disasters such as the tsunami last month, than their more modest peers.

"There seems to be a certain resilience in the luxury travel segment," he said.

"Luxury travellers have lots of experience ... and a comfort level that travel doesn't necessarily expose them to a greater risk than living at home."

Marketing experts estimate that luxury goods sales across a variety of sectors have grown more than 20 per cent annually, compared with about 5 per cent growth for mass retail.

But greater competition for those dollars has shifted the majority of luxury ad spending from mass publications such as national newspapers to niche magazines and some careful internet forays.

Luxury goods companies "are getting much more aggressive in terms of where their spending goes", said Gregory Furman, head of the Luxury Marketing Council.

Many luxury marketers were also playing the role of social planner, sponsoring exclusive soirees or unusual retreats to keep the biggest spenders loyal to their brands, not unlike the free music concerts or giveaways employed by mass retailers.

"There's more money, but the customer is more demanding, wanting to understand the price value and ... needing to be courted."

- REUTERS