24 May 2023
Luxury products generated a market revenue of US$354.80 billion (฿11.13 trillion Thai Baht) in 2023. The Thai luxury product market is projected to grow 6% annually until 2028. However, the key to successfully launching and sustaining a luxury brand remains elusive. “Luxury Brand Management in Digital and Sustainable Times,” a book by Michel Chevalier and Dr. Gérald Mazzalovo, and first published in 2020, may be the key to understanding this elusive industry. It is so popular among business school students and anyone interested in the luxury brand industry that it is now in its 4th edition and has been published in English, Chinese, French, and Italian. Dr. Mazzalovo recently talked about the book at the launching of the Thai version on March 15. Dr. Thitiporn Sathavornmanee, the book’s translator and the Executive Director of Luxellence Center, was the emcee of the launch event. Having worked for a luxury jewelry brand, Dr. Thitiporn relied on the book for guidance. “The book is a good balance between the academic and practitioner approaches and is easy to digest,” said Dr. Thitiporn. After first meeting Dr. Mazzalovo when he was CEO of Jim Thompson CEO, she eventually asked whether he would be interested in translating the book into Thai. Dr. Mazzalovo, a Fellow at Sasin School of Management, has worked in the luxury brand industry for 30 years, including at such high-profile brands as Salvatore Ferragamo, Loewe, Bally, Clergerie, and Jim Thompson. He has also taught at universities in France, Italy, and Spain and has written many academic articles on brand management. Michel Chevalier is an expert in luxury brand management and retailing. He was the Executive Vice President of Bluebell Group, Asia’s leading omni-brand curator, and the President of Parfums Dusita Paris. He is also a Visiting Professor of Luxury Management at HEC Paris and Universita Cattolica di Milano. “We are two authors bringing different types of approaches, sensitivities, and experience to the table,” Mazzalovo said. He added that while most books on luxury brands focus on the physiological or philosophical aspects of luxury goods, “Luxury Brand Management” is packed with information written by two practitioners with hands-on experience working with luxury brands. This book offers a distinctive combination of macro and micro views of luxury brand management. It covers a wide range of topics, including market size, turnover, and profitability of major luxury companies. Additionally, it equips the reader with analytical tools specifically designed to establish and enhance brand identity. Mazzalovo’s focus in the book lies on the microeconomic side, drawing from his firsthand experiences working for industry legends such as Ferragamo and Jim Thompson and strategic considerations born from an attentive observation of the luxury brand market. At the launch event, he warned new entrepreneurs that building a luxury brand takes more than just access to the internet. Even though digital technology makes it more convenient to market a luxury brand, there are many things brand managers have to consider today. One important topic covered in the book is brand manifestations, which explores the various touchpoints through which consumers engage with the brand and the behavior exhibited by individuals who use the product. “The brand managers have to find the proper balance between a multitude of opinions not always based on reason and not try to be everything for everybody,” he said, adding that marketing communication and strategy must be geared towards how brands manage those interactions with customers. He gave an example of Alessandro Michele, an Italian fashion designer and creative director of Gucci, who left the brand after seven years. “If you look at what types of things he was proposing, it was an example of not expressing any identity of Gucci. Instead, it was pure surprise, provocation, jumping from one thing to another,” said Mazzalovo. This brings us to another point about authenticity in brand management, which is treated in one of the chapters in Luxury Brand Management. “Jim Thompson has more legitimacy and authenticity in using the tiger in their collection than Gucci ever had,” he said. “Authenticity is about being true to your identity. For example, Swarovski is not an authentic diamond but an authentic crystal. Swarovski never said they are selling diamonds,” he said. He also talked about Jim Thompson, whose success has come from positioning the Thai brand as an authentic, fully integrated manufacturer of silk. While Jim Thompson takes complete control of the production process, making the silk from the worms to the finished product, Hermès buys the yarns from external sources. In the 1940s and 1950s, the brand’s founder, Jim Thompson, revived the Thai silk industry by introducing modern dyes imported from Switzerland instead of traditional natural dyes. He also introduced the brand to America, where his creations became famous when celebrities wore the silk in the 1956 film “The King and I.” Sustainability has also become crucial in the luxury market. For example, Burberry admitted to destroying 28.6 million pounds (1.13 billion Thai Baht) of unsold merchandise in 2017 to preserve the brand’s exclusivity. “There needs to be someone in charge of sustainability. However, it’s not enough to have sustainability embedded in strategy and values; it must also be instilled into the design process,” Dr. Mazzalovo said. The book also focuses on brand positioning, including what classifies a luxury brand as a traditional, exclusive, and exceptional brand. If a brand is exclusive but not exceptional, it is placed as an intermediary luxury. If the brand is neither exclusive nor exceptional, it is a mass-market brand. “An exclusive and exceptional brand is closer to being a traditional luxury brand,” said Mazzalovo.