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Beyond rarity: the paths of luxury desire.

How luxury brands grow yet remain desirable


Jean-Noël Kapferer
INSEEC, Paris, France, and
Pierre Valette-Florence
IAE Grenoble, Grenoble, France

Abstract
Purpose – Luxury is a growing sector worldwide. This creates a major managerial challenge: How can luxury brands prevent becoming a victim of
their own success? Once objective rarity is lost, what other levers still sustain desire for these luxury brands, nurture their dream and, thus, prevent
the dilution of desirability created by their growing penetration and sales?
Design/methodology/approach – Based on 1,286 actual luxury consumers interviewed about 12 highly known and successful luxury brands on
42 experiential and perceptual items, a PLS hierarchical fourth-order latent variables model unveils the paths of luxury dream building.
Findings – The authors have identified how, beyond mere physical rarity and very high quality, eight experiential and perceptual levers fuel luxury
desirability through two structural paths: selection and seduction.
Research limitations/implications – The concept of luxury is associated to rarity. But to grow, luxury brands need to abandon mere scarcity and
selectivity (value created by limitation of production, highly selective distribution and selection of customers) and switch instead to an “abundant
rarity”, where feelings of privilege are attached to the brand itself, seducing through its experiential facets, pricing, prestige and the world it
symbolizes.
Practical implications – Luxury executives can use this paper as a compass to manage, sustain and monitor their brand desirability, all along the
brand’s growth, as it moves away from being niche and rare.
Social implications – Considering the growing social diffusion of the need for luxury in different strata of the population, this paper reveals the
levers of the attractiveness of the mega-brands of luxury.
Originality/value – This paper addresses the main problem of the luxury industry: How to grow yet remain desirable. It is based on 1,286 actual
luxury buyers and 12 actual brands. Thanks to PLS modelization, the structure of the levers of brand desirability is revealed.
Keywords Brand love, Luxury, PLS modeling, Desirability, Growth, Rarity
Paper type Research paper

Introduction: the new landscape of luxury island. Although these images come spontaneously to mind
when consumers are asked what the word luxury evokes
Luxury is as old as humanity, at least humanity with a social
(IPSOS, 2014), modern luxury is very different: It is an
and hierarchical organization (Berry, 1994). Historians have
actively growing sector, targeting an expanded clientele.
analyzed the evolution of luxury through centuries and
Luxury stores now flourish in all capital cities of the world. For
civilizations (Castarède, 2009). Today’s rising global appetite
an emerging country, the presence of luxury stores is the signal
for luxury, far beyond the limited circle of riches and
of the country’s economic growth and of the emergence of a
powerfuls, attracted the attention of scholars from all
middle class willing to access to the best that the consumer
disciplines. Interest among business academics has also
society can offer.
grown, as luxury is a thriving economic sector, with prominent
If mature countries still remain the dominant luxury
brands, reputed companies, concentrated groups, some of
markets because of their high purchasing power (USA, Japan,
them gone public to finance their international retail
Europe), then the long-term future of luxury is elsewhere in
expansion (LVMH, Kering, Prada, Hermès, etc.).
these emerging countries. It is predicted that China could
Luxury started as a niche, limited to the happy few, the only
become the Number 1 country of the luxury sector in 2020,
ones who could afford it. At the turn of the past century, few
because of the considerable size of its middle class, wanting to
people had an automobile, just as very few consumers today
enjoy life after decades of deprivation (Bain & Company.,
fly in private jets or own a yacht or maintain a Caribbean
2014) and who travels now outside China.

The current issue and full text archive of this journal is available on
Emerald Insight at: www.emeraldinsight.com/1061-0421.htm Luxury: experience versus essence
Despite the ubiquitous visibility of luxury brands and luxury
malls in capital cities of the world, the question “what is
luxury?” is still debated among academics. Not only are there
Journal of Product & Brand Management as many definitions as researchers but also these definitions
25/2 (2016) 120 –133
© Emerald Group Publishing Limited [ISSN 1061-0421]
changed through time (Yeoman, 2011; Yeoman and Mc
[DOI 10.1108/JPBM-09-2015-0988] Mahon-Beattie, 2010). Many scales have been proposed to

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identify what factors underlie the luxury concept (Kapferer, Paternault, 1995)? Our objective is not to propose another
1998; Vigneron and Johnson, 1999; Dubois et al, 2001; definition of luxury or to decree which brands are – or are
Beverland, 2005; Wiedmann et al., 2012). However, this not – luxury brands but to address the demand of the
abundance of scales has not helped in understanding the managers of these best-selling luxury brands: They want to
steady growth of the luxury sector. know what are the levers of the desire today for their brands,
The essence of luxury may still be elusive, yet its existence beyond rarity, on which they need to capitalize. How to
is clear for all consumers. Survey research institutes compensate the loss of rarity and the diluting effects of the
consistently show that the pantheon of luxury brands is indeed higher penetration resulting from their growth made through
a small club: When interviewees are asked what brands they sales of accessories and second lines, more accessible. The
hold as best exemplars of luxury, the same names appear all luxury managers require a grid to diagnose on which pillars
around the world (Vuitton, Chanel, Rolex, Ferrari, Gucci, rest the sustained desirability of their brands.
Tiffany, Prada [. . .]) (IPSOS, 2014). This is normal: When it To answer, we deliberately focused our research on a
comes to the market, luxury is not a “concept” but a reality sample of 12 well-known successful luxury brands, whose
incarnated by brands and their magnificent stores stores are everywhere in the world and whose growth seems to
concentrated on high street. Those malls of Seoul, Taipei or have no limits. Based on answers from 1,286 luxury buyers,
Shanghai calling themselves “luxury malls” tell what brands thanks to the access to a major French “affluent panel”, we
are the “luxury brands”. This shapes the new consumers’ investigate the drivers of the sustained desire of these brands.
vision of what luxury is. This is why brands are at the core of Unlike other studies about luxury brands, we position our
luxury today. Debates about the definition of luxury may questions at the consumers’ experiential level (what luxury
continue among scholars, yet the ubiquitous existence of the consumers see, hear, feel and experience at contact points with
same luxury brands, luxury products, luxury malls and the luxury brands’ marketing and communication mix). To
communications across countries creates a quite sustain their brands’ desirability, luxury executives need to
homogeneous consumer experience and, hence, vision. know what operational levers they should use, by means of the
product range, pricing, specific distribution channels and store
The dilemma of ever-growing luxury brands experiences, as well as communication, including digital. This
defines the purpose of the present research: To answer, we
To grow, with the exception of very few (Romanée Conti
shall test a luxury brand building model, both integrated and
wine, Ferrari or Rolls-Royce automobiles, boutique hotels
multidimensional. We identify eight operational levers which
with very few rooms,) luxury brands have had no choice but to
must be implemented by the luxury brands if they wish to be
abandon product and ingredients rarity as the precondition of
held as luxury by consumers and refuel their dream potential.
luxury and adopted “abundant rarity” strategies (Kapferer,
Through a fourth-order latent variables PLS confirmatory
2012) characterized by feelings of exclusivity more than actual
factor analysis framework, we show how these factors combine
exclusivity and by artificial rarity tactics (limited editions,
together and construct several paths of desirability of luxury
capsule collections). This is also why luxury brands have
brands today.
changed the focus of their investments, moving from
In what follows, our theoretical framework, we first address
production to the creation of memorable retail experiences, to
the issue of how luxury creates value. We then turn to the
personalized services and to attaching symbolic capital and
research objectives and methodology section. Results are,
prestige to the brand name itself through communication,
thus, discussed and managerial, as well as theoretical,
social influence, social networks, celebrities, brand
implications drawn. Finally, the authors acknowledge the
ambassadors [. . .] Because these investments are very
limitations of the study and outline future research avenues.
demanding, many independent luxury brands have now
joined concentrated luxury groups (Kapferer and Tabatoni,
2011): Gucci, Bottega Veneta, Bulgari, Loro Piana, etc., are How luxury creates value
recent typical cases. Luxury evokes high prices among consumers of most
Thus, the growth of the luxury sector beyond the small countries (Godey, 2013). But the high price of luxury is of a
niche of high net worth individuals not only has been a special kind: It can never be fully justified by a gap in product
blessing but also creates a problem: The kernel of most luxury quality or performance alone. Sheth Godin’s definition of
definitions is elitism, but today, elitism is more an image than luxury (Godin, 2009) as “needlessly expensive” does capture
a reality (Thomas, 2008). Certainly, high jewelry or Rolls this essential facet. McKinsey estimates that the average price
Royces are rare and very expensive. But Porsche sales now of a luxury watch is 167 times that of a standard watch.
reach 225,121 in 2015. It is rumored that Rolex sells 1 million Obviously that does not mean its quality is 167 times better. In
watches per year. (As it is a family-owned company, no data fact, the even notion of performance does not fully apply to
are available.) This is no more rarity. What then contributes to luxury: Luxury redefines what quality means. Because Patek
the sustained desire of Rolex and its being systematically Philippe watches are made by hand, they cannot be as precise
quoted by consumers as the iconic luxury watch in the world as industrial mass marketed quartz watches; thus, they go late
(IPSOS, 2014)? regularly. Baccarat Cristal glasses are much more fragile than
The objective of the present research is to unveil the levers usual glasses. A Ferrari is much more unpredictable than any
sustaining the high desirability of these luxury mega-brands, Toyota or Ford.
although rarity is abandoned, at least on a large section of their As luxury high prices are not fully explained by functional
offering. How can they resist the diluting effects of more qualities, this means that luxury brands create value far
penetration on their desirability and dream (Dubois and beyond the satisfaction derived from superior product or

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service performance or quality. Luxury price is that of the (2005) criteria used to define a luxury wine, five are
“singularities” (Karpik and Scott, 2010) built by the product-based: stylistic consistencies, quality commitment,
intangibles (such as heritage, tradition, history, country of relationship to place, unique method of production, heritage
origin, association to famous clients, to an imaginary lifestyle). and pedigree. Only “downplay of commercial motives”
It is also the price to be paid to symbolically be part of the applies more to the brand. In modern luxury, brands have
same closed club as these VIP’s who made the brand, thus, become crucial because the more one sells intangible values
gain social recognition and distinction (Veblen, 1899). beyond functional ones, the more these intangible values must
Finally, beyond wealth and status signaling (Belk, 1988), as be certified: Only the fame of the brand can guarantee them.
shown by Amaldoss and Jain (2005) it is the price high enough In luxury, no one wants to buy the wrong brand. This is why
to make followers, unable to follow. luxury business is a brand-building business: Once
Wiedman et al. (2009) proposed an integrated tri-partite established, trust, reputation and desirability can be leveraged
model of these key values created by luxury. They distinguish to expand the product base, as well as the consumer base. This
functional, individual (luxury for self) and social values explains why luxury brands can be so largely extended:
(luxury for others). Functional values remind that unlike art, Armani extends from clothes to hotels. These brands do not
luxury products have also to be extremely well performing. sell function but hedonism, style, recognition and art
Individual values refer to self-identity values, hedonic benefits (Hagtvedt and Patrick, 2009).
and liking materialism. Social values are fulfilled by luxury To conclude, it is time to acknowledge that luxury is made
conspicuousness. Wiedmann et al. (2009) added a “financial by brands and that luxury brands are not simply brands which
value” to their model, but this remains awkward: Measured by sell luxurious products, they also sell the dream attached to
an item like “Luxury is inevitably very expensive”, this is more their own name and the world they symbolize. The luxury
a defining characteristic than a value stricto sensu. sector has grown because today, more people want a share of
this luxury dream, even exceptionally (Nueno and Quelch,
Luxury: the product and the brand 1998; Silverstein and Fiske, 2005). In the modern society,
consumption is held as a source of happiness (Baudrillard,
Among all luxury brands, according to two institutes
1998): It is normal that its most extreme production as well as
(Millward Brown and Interbrand), Louis Vuitton is the most
experience be held as an access to dreams, under the umbrella
valuable in 2015: It is worth $22.250 bn and ranks 20th
of a highly desirable brand.
among all world brands from all sectors. Are Louis Vuitton
products themselves luxurious, that is to say exclusive, unique,
rare, precious, crafted or made by hand with the noblest
ingredients? Or is the Louis Vuitton brand itself emerging as Research objective and methodology
an international icon of luxury – embodying the taste of elites According to brand valuation experts, the luxury sector is the
all around the world through other levers which build an one where brands’ financial values represent the highest
incredible desire based on virtual rarity, feelings of privilege, of percentage of their company market value (Murphy, 1991). In
exclusivity and of symbolic association to the stars of our brief, the stock market expectations about Prada shares are
world, the celebrities and their dreamed life? Today, luxury most dependent on the desirability of the brand Prada itself,
brand building entails other paths than simply product and its symbolic capital, source of its pricing power. What are the
service excellence and objective rarity. levers and paths of these successful luxury brands, whose
For luxury executives, the above-mentioned tri-partite continuing growth seems limitless, once abandoned mere
model of value creation (functional, individual and social) is product rarity? This is the focus of this research. It will help
partly useful. How should they relate it to their day-to-day understand how highly successful luxury brands keep their
decisions, to the marketing mix itself, to what needs to be cachet and desirability despite their growing penetration of the
implemented for this luxury brand? How to sustain the Louis market.
Vuitton luxury dream when scarcity is abandoned? How can Because this was not their objective, the main published
Louis Vuitton (or any other successful luxury brand) sustain luxury scales do not answer these questions. Thus, Wiedmann
the consumers’ feelings of an exclusive purchase, highly et al. (2009) and Hennigs et al. (2012) focus on the tri-partite
emotional, signal of belonging to an idealized world, when definition of luxury value creation: functional, individual and
long queues of Chinese tourists wait outside their flagship social. They use items such as “I place emphasis on quality
stores everywhere in the world? These people wait to enter the assurance over prestige”, “I derive self satisfaction from
Vuitton store or the Gucci store or the Dior store. They buying luxury goods” and “It is important that others have a
express first a choice of brands. In modern luxury, the brands high opinion of how I dress and look”. These items focus more
have accumulated a symbolic capital which does not merely on individual differences than on brands themselves: They do
rely on the product uniqueness and preciosity but on the not help luxury executives identify what levers they should
desirability of the brand as a whole. Social statements are activate to sustain their luxury brands’ dream as they grow?
made by wearing the logos of known brands: Social Another well-known luxury scale (Dubois et al., 2001)
recognition is not conveyed by a bag unless its brand is identifies three factors underlying luxury: distinction, elitism
recognized even by non-buyers. and hedonism. The first factor is measured by items such as
Despite the importance of the brand, it is interesting to “This is a brand to dream”, the second by “This brand
remark that research on luxury often searched the represents luxury” and the third by “It is a real pleasure to own
discriminant characteristics in the products themselves, much this brand”. Still, how should the brand managers relate these
less in the brand. For instance, among the six Beverland’s items to the precise actions they need to undertake?

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To maximize managerial relevance, this research focuses on ● For distribution, we selected items referring to the fact that
the experiential level. If everybody agrees that today’s luxury the brand is perceived as not widely distributed and that its
brands should deliver feelings of privilege, pleasure, exclusivity stores have a select atmosphere able to carry the magic of
and uniqueness (Godey, 2013), for the brands themselves, the brand (Dion and Arnould, 2011).
then the operational question is how to produce these feelings? ● For communication, we tapped whether the brand is
Thus, one needs to get closer to the contact points themselves perceived as very much talked about in the media, creating
between consumers and luxury brands. the buzz or is it perceived as a brand which is no more
To achieve this research goal and identify how can actual. Evaluations of the communications of the brand
successful luxury brands sustain their desirability, we themselves were included (do they have class?).
positioned the questions asked to consumers at the level of As we focus on the brands, other symbolic dimensions were
consumers’ experience. Desire for a luxury brand is also measured which have been shown to contribute to
constructed at contact with the luxury brand (through its desirability:
products, its prices, its retail distribution or social media, its ● Luxury brands select their clientele (there is a relationship
communication and its services), also with its clientele (either between being seen as exclusive and as excluding): One
real or imagined: What type of clients is said to be patronizing needs to measure what clientele is associated to the brand.
the brand?). Of course it is also based on the symbolic image (Is it elite people or is it more middle class or even all
propagated through the media, social networks and word of classes?) Is the brand perceived to be bought by celebrities?
mouth. In managerial terms, one would speak of marketing The customer “reflected image” is a key dimension of
mix or influential mix or experiential mix, all of them building brand choice for conspicuous behaviors: It creates value by
symbolic capital, source of the high singularity of the brand making the brand aspirational, a way to emulate these
and, hence, its non-comparability and desire. people and at least symbolically be endowed with their
A consequence is that our exploration of the levers of brand status, just by carrying the same brand logo. Luxury
dream and desirability will focus on concrete elements of brands elevate their clients.
experience and avoid evaluative abstract words such as: magic, ● Luxury brands promise more than being different; they
unique, rare, distinctive, elitist, gratifying, pleasant, aim at uniqueness, exclusivity, a high singularity based on
outstanding, attractive [. . .] These words which are typically history, high taste, as well as exclusive style, originality of
found in many luxury perception scales are high-order designs, creativity and avoiding becoming too classic.
constructs, either perceptual or evaluative, giving no clue as to ● Finally, as for all brands, some luxury brands are perceived
how to induce them. Thus, it is commonly said that luxury as leading brands, making the trend, driving today’s taste
should be “rare”: But rare in what meaning? Is it in the nature and class: This makes them power brands.
of the product ingredients? Or in the know-how? Or in the
history? Or the retail presence and experience or all five? Or is Brand selection
the term “rare” just a global evaluation, close to “unique”, What stimuli would be used to measure these perceptions? As
somehow meaning “different from other brands”. The same the brand is the aggregator of all the created values, we chose
remarks could apply to words such as “attractive”, which is to ask respondents to evaluate one brand picked randomly
indeed an aggregate evaluative judgment of a number of facets among 12 brands. Knowing this brand was a condition for
of the brand but without specifying which ones. answering. The choice of asking many items on only one
brand is based on the fact that respondents had to fill in a
lengthy questionnaire (the 42 aforementioned items) and that
Items generation
the nature of these respondents (they are not students)
From the outset, a series of in-depth interviews of a small
precluded asking such a list of questions on more than one
sample of luxury clients was conducted, as well as luxury
brand. In all, however, 12 brands were profiled. In addition,
managers: What is it that made them love some specific brands
respondents evaluated the brand in terms of desirability: How
and not others? Why and how would a luxury brand lose its much does this brand represent “a brand they dream of”? We
cachet? In doing what? At what signs would one notice it? Why talk of dreams for – unlike mass goods which deliver
are some brands not losing their cachet despite the visible satisfactions – luxury proposes the achievement of ideals, by
extension of their clientele? All the verbatim was then content making them real and accessible. Yet although luxury
analyzed and categorized. All in all, this led to the selection of companies tend to define themselves as “producers of
42 items, which could be grouped according to the marketing dreams” (Longinotti-Buitoni and Longinotti-Buitoni, 1999),
mix: little research has focused so far on the luxury brands’ dream
● For the product dimension, the classical elements of potential (Dubois and Paternault, 1995). Because dreams are
experience should be tapped: exceptional beauty, nobility usually not cheap, the profitability of the sector is very high.
of ingredients, craftsmanship, do the products carry a Luxury is a sector with luxurious margins, a real financial
tradition or a heritage, have they the highest level of quality dream (Kapferer and Tabatoni, 2011).
and do they ignite emotions. The choice of these 12 brands was based on the premises of
● For pricing, we retained three items, which correspond to this article: Modern luxury has abandoned objective rarity
typical policies of the luxury market: being expensive, (Nueno and Quelch, 1998; Kapferer, 2012). This was
having a few products in the range totally out of reach, necessary for securing the brands’ growth, fulfill expectations
and – at the opposite – developing accessible lines to of the stock market and shareholders today. For sure, some
expand the customer base. well-known brands still limit their production, hence their

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long waiting lists (a few months for a Kelly bag at Hermès, luxury?). The choice of a dichotomous single answer was
more than a year for a Ferrari [. . .]). We focused instead on made to reduce the length of the questionnaire and to
those brands which are not following a scarcity model but a polarize each brand.
virtual rarity one (creating feelings of exclusiveness, of
The aim of the research is to identify what factors structure the
uniqueness, etc [. . .]). These brands aim at being sales leader
luxury brand experience and to illustrate which of them
and also perceived as luxury. Thus, Lexus USA claims it is
contribute most to desirability (dream) and perceived
“USA N°1 imported luxury car brand”. The same holds true
luxuosity of some selected brands beyond rarity. For
for the challenger, Mercedes Benz. We also included such
theoretical advancement, we shall explore how an overall
brands as Louis Vuitton, still held by Interbrand in 2015 as the
brand luxury desirability decomposes in lower-order
world’s most valuable luxury brand, precisely because of its
dimensions which ultimately end up to eight main experiential
phenomenal sales success despite its high price and never
factors.
making any price reduction or sales promotion. The more
successful this brand is, the more polarized are
consumers’evaluations of the brand, with some people Choice of the statistical methods
considering that Louis Vuitton has totally lost its luxury status, To determine the main dimensions of brand luxury
while others still dream about it. The same can be said for desirability, we first performed exploratory principal
Ralph Lauren, Rolex, Armani, Mercedes and Estée Lauder. components analyses with Promax rotation. Deleting items
From a methodological standpoint, focusing on brands with low communalities and loadings below 0.50 led us to
about which there is a debate guarantees high variance of the retain 34 items (among the 42) structured around eight main
answers. There is not much variance to expect when asking dimensions (78 per cent of explained variance). In itself, this
whether Rolls-Royce or Hermès are luxury brands. Had we result is striking: It contrasts with former similar research
selected such unanimous brands would have threatened the where only three to five such factors emerged [for a synthesis
conclusion validity of our statistical analyses. We chose of research, see De Barnier et al.(2012)]. Then, we have
instead brands which would polarize opinions. We also formally tested this solution by means of a confirmatory factor
selected brands on which both men and women could answer. analysis technique. To investigate how these eight factors
The final list of brands is: combine themselves and form distinct paths toward luxury
● Lexus and Mercedes Benz; brands’ desirability, a PLS approach has been selected for
● Louis Vuitton and Longchamp; three main reasons:
● Ralph Lauren and Giorgio Armani; ● First, because of its minimal demands on sample size and
● Mauboussin and Chaumet; suitability to handle with model complexity and violation
● Lancôme and Estee Lauder; and of multivariate normality (Bagozzi and Yi, 1994).
● Rolex and Yves Saint Laurent. ● Second, because of its ability to handle higher-order factor
structures very easily (Wetzels et al., 2009).
What are the levers of the desire still attached to them by a ● Third, because of its unique capability to compute factor
large number of consumers? scores that can help to profile the 12 brands under study.

Sample of respondents
Results
To have an access to relevant respondents, actual or potential
luxury buyers (unlike students too often used in published The results will be presented in two main steps. Fist, a series
luxury research), we used Le Figaro Magazine affluent of exploratory, as well as confirmatory, factor analyses is
Internet panel. Le Figaro Magazine is France’s Number 1 conducted, followed by more focused analyses dealing with
magazine in terms of advertising by luxury brands. It has built specific luxury brands to stress the managerial outputs
a panel of readers – called the Affluent Panel – who accept to provided by the scale.
regularly be interviewed on editorial matters through Internet.
Our research was an exception: It was presented as Profiling the brand luxury experience: What key
fundamental research. In terms of demographics, there were factors?
49.2 per cent of women and 50.8 per cent of men. Mean age Scale structure and first-order dimensions
was around 55 years old; 78 per cent hold a higher education First of all, a principal component analysis allowed
level, and 55 per cent had an average net income per month determining the number of dimensions by means of a scree
greater than €5,000 (mean equals €87,250 of total net income test, indicating a clear elbow for eight dimensions. After
per year). Globally, 89 per cent could be characterized as deleting items with loading below 0.5 and with low
belonging to an upper socio-professional category. Finally, 53 communalities below 0.4, we got a shortened list of 34 items
per cent had bought an expensive luxury product during the that were subsequently submitted to a confirmatory factor
past 12 months. In all, 1,286 persons took part and completed analysis.
the questionnaire on the Internet, comprising two main sets of Although the measurement and structural models are
questions: simultaneously and iteratively estimated within the PLS
● The first set comprised the 42 Likert-type items discussed approach, the reliability and validity of the measurement
above (Likert type in six points) on their perception of 1 model should be first assessed. Once the adequacy of the
brand randomly chosen among 12. first-order construct measurements is verified, the structural
● The second set relied on dichotomous global evaluations relationships among the constructs and the quality of the
of that brand (Is this brand dreamed of? Is it considered as overall model are then assessed (Fornell and Larcker, 1981).

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The adequacy of the reflective measurement model can be status. It is a leading brand. All that it does has class (its
assessed by looking at composite reliabilities, the convergent advertising for instance).
validity of the measures associated with individual constructs Factor 4 captures the ability of the brand to remain very
and discriminant validity (Henseler et al., 2009). Results are actual, unique, by generating excitement, by remaining alive
displayed in Tables I and II. As for the first-order reflective and active, original through time, today as yesterday (Groth
latent variables, all the indicators of convergent validity and and McDaniel, 1999). Unlike fashion which captures the
reliability are satisfied. Hence, a test of the discriminant spirit of the times and then goes, luxury brands resist the
validity (Fornell and Larcker, 1981) shows that each deleterious effects of time. But they are not antiquities; they
first-order latent variable shares more variance with its must always prove their actuality, their relevance, be at the
respective indicators than with the other latent variables it is forefront, be singular.
correlated with. Ultimately, Table III of cross-loadings clearly Factor 5 (Not for everybody) captures the respondents’
shows that each dimension is best measured through its feeling that the clientele of the brand is or is not getting too
measurement variables. More precisely, this last table enables large. Luxury exists because everybody cannot access to it.
to comment the eight identified dimensions, pointing out that Interestingly, one of the items in this factor is related to pricing
these dimensions often mix both tangible and intangible (“the brand has introduced accessible lines”): Doing so, the
elements: brand sends signals to its actual clients that it prefers volume
Factor 1 is typically a product superiority factor. It comprises to value.
notions of rare and noble ingredients, high quality as well as Factor 6 is a glamour factor. Luxury-like status is not created
exceptional beauty (an hedonic component). The product by products alone. Status comes when status endowing people
embodies also tradition and heritage. In luxury, products are choose that particular brand: This is the role of the celebrities.
not simple products: Their unicity is based on a rare mix of Thus, Princess Grace of Monaco (formerly the Hollywood
tangibles and intangibles. They are a bridge between the past actress Grace Kelly) made a Hermès bag famous all over the
and the present; quality is inspired by history. They are world and become an icon of luxury. This is why brands must
hedonic, beautiful, refined and spirited. manage their “reflected customer” image: It is a key
Factor 2 is a selective distribution factor. Luxury brands must component of their desirability. This is also why they need to
be selective in everything they do, starting with the place choose their mostly symbolic clients.
where they reign and can be met. Their stores must be Factor 7 is the elitism factor. It combines items about having
perceived as not numerous, as well as their atmosphere a great history, being very known and having some extremely
expressing refinement, class not mass. So many licenses of expensive products within their range, unaffordable. Factor 8
distribution have been bought back by luxury brands when taps the necessary creativity of the brand, being fashionable.
they felt the licensee was over distributing the brand, the The fashion weeks in New York or Paris are F1 races of
fastest way to dilute the exclusivity of the brand. creativity where the Haute Couture brands are the competing
Factor 3 is a class and status factor. This powerful brand racing teams of the catwalks. Some brands become real “must
stands above the others and endows the buyers with class and have” brands, hence their remarkable growth.

Higher-order dimensions
Table I Reliability and convergent validity of first-order dimensions
How do these eight factors combine to build the luxury dream
Convergent Jöreskog’s and desirability? In the above section, we analyzed the
First-order dimensions validitya rhob first-order factors. In this section, we present a model where
Product superiority 0.660 0.931 these factors combine themselves two by two to build
Selective distribution 0.718 0.884 higher-order unobserved variables.
Not for everybody 0.621 0.868 An higher-order factor structure analysis estimated within
Actual still unique 0.521 0.867 the PLS framework implies two parts: one related to the
Elitist 0.549 0.824 measurement of the first-order latent dimensions and a second
Glamour 0.678 0.863 structural one concerned by the strength of the connections
Gives class and status 0.522 0.813 between the higher-order dimensions and their respective
Fashionable 0.594 0.806 lower-order facets. In that precise case, one has to be aware of
the exact choice of the nature of the relations between latent
Notes: a % of shared variance between the latent variables and its in-
concepts, that is to say, to decide of the choice between either
dicators; b reliability coefficient scaled between 0 and 1
reflective or formative indicators (Wetzels et al., 2009). More

Table II Reliability and convergent validity of higher-order dimensions


Convergent Jöreskog’s Convergent Jöreskog’s Convergent Jöreskog’s
Second order validitya rhob Third order validity rho Fourth order validity rho
Objective rarity 0.86 0.92 Selection 0.7 0.82 Luxury desirability 0.9 0.94
Exclusivity 0.78 0.88
Prestige 0.73 0.84 Seduction 0.82 0.9
Creative leadership 0.82 0.9
Notes: a % of shared variance between the latent variables and its indicators; b reliability coefficient scaled between 0 and 1

125
Table III Original items and cross-loadings
Product Selective Class and Very actual still Not for
Items superiority distribution status unique everybody Glamour Elitist Fashion
Each of its products expresses a unique know how 0.830 0.587 0.628 0.203 0.077 0.448 0.532 0.563
It has some products with an exceptional beauty 0.764 0.472 0.596 0.192 0.042 0.387 0.486 0.554
This brand symbolizes refinement 0.842 0.655 0.731 0.266 0.118 0.540 0.465 0.556
The brand uses noble and rare ingredients 0.828 0.690 0.635 0.222 0.120 0.517 0.482 0.497
Its products have in themselves an heritage 0.804 0.593 0.644 0.152 0.062 0.498 0.523 0.475
A real superior quality of product 0.817 0.586 0.663 0.273 0.140 0.527 0.485 0.466
It is a brand unique of its kind 0.798 0.616 0.654 0.253 0.083 0.563 0.438 0.534
Can not be found everywhere, selective distribution 0.557 0.854 0.474 0.118 0.237 0.479 0.408 0.370
It is produced in small series, not in mass 0.636 0.878 0.518 0.109 0.237 0.504 0.398 0.419
Its stores are very select with a real atmosphere 0.704 0.808 0.650 0.173 0.117 0.532 0.476 0.507
The brand conveys status to its clients 0.596 0.479 0.801 0.139 0.128 0.477 0.478 0.490
Jean-Noël Kapferer and Pierre Valette-Florence
How luxury brands grow yet remain desirable

The brand is renowned leader in its category 0.666 0.530 0.788 0.254 0.016 0.479 0.462 0.530
Its advertising has a lot of class 0.627 0.513 0.733 0.215 0.030 0.449 0.386 0.557
The brand endows class to those who use it 0.651 0.499 0.827 0.273 0.140 0.507 0.383 0.466
This brand is still what it used to be 0.187 0.099 0.161 0.710 0.277 0.042 0.067 0.016
For me, the brand still keeps its exclusive character 0.254 0.206 0.223 0.697 0.450 0.142 0.037 0.110
This brand is still up to date 0.228 0.110 0.261 0.754 0.262 0.084 0.031 0.195

126
This brand is not too classic 0.084 0.045 0.102 0.640 0.215 0.042 0.031 0.119
Today, this brand keeps its originality 0.241 0.145 0.232 0.730 0.267 0.056 0.014 0.200
We still hear about this brand today 0.106 0.009 0.142 0.792 0.071 0.046 0.080 0.127
It is not purchased by customers from all walks 0.078 0.211 0.057 0.279 0.865 0.165 0.059 0.063
For me, it is not too diffused today 0.204 0.221 0.186 0.516 0.694 0.090 0.004 0.024
It is not a bit bought by everyone 0.086 0.183 0.083 0.306 0.843 0.103 0.007 0.041
Most of its products are not at all affordable in 0.051 0.073 0.077 0.030 0.509 0.128 0.166 0.160
price
It is a sophisticated brand 0.506 0.458 0.447 0.068 0.097 0.743 0.391 0.396
The brand makes us think of rich and famous people 0.532 0.523 0.546 0.070 0.170 0.889 0.501 0.395
It is bought by celebrities 0.483 0.482 0.499 0.078 0.126 0.832 0.497 0.365
The brand has a great history 0.648 0.414 0.536 0.064 0.039 0.378 0.701 0.446
It is a very known brand 0.361 0.207 0.375 0.059 0.182 0.284 0.646 0.344
It is very expensive 0.391 0.432 0.343 0.037 0.217 0.454 0.761 0.254
Some of its products are really unaffordable 0.357 0.365 0.342 0.088 0.112 0.486 0.775 0.193
It is very creative 0.637 0.460 0.578 0.249 0.007 0.370 0.372 0.853
Volume 25 · Number 2 · 2016 · 120 –133

It sets the fashion launches styles 0.532 0.412 0.559 0.161 0.049 0.381 0.327 0.898
Journal of Product & Brand Management

It is much talked about in people or fashion 0.257 0.277 0.291 0.071 0.159 0.357 0.259 0.497
magazines
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precisely, the choice is between one of the four potential indices as those used for covariance-based structural equation
hierarchical models put forward by Becker et al. (2012). The modeling, Tenenhaus et al. (2005) propose the geometric
reflective-reflective Type I model has been selected, as the mean of the average communality (measurement model) as
objective of the study is to find out the common factor of well as the average R2 (structural model), as an overall
several related, yet distinct reflective constructs. The rationale goodness-of-fit (GoF) measure for PLS. In this research, the
behind that choice is that similar to the concept of human absolute GoF value is 0.587, corresponding to an excellent
personality, we assume that a global luxury desirability adjustment according to Wetzels et al. (2009) (GoF higher
orientation does exist and reflects in lower-order dimensions, than 0.36 are large).
representing different facets of the relationship between In terms of the four second-order reflective latent variables,
consumers and luxury brands. Moreover, this point has been convergent validity and reliability, displayed in Table II, are
exemplified through the qualitative part of the survey, as a fairly good as well. The same holds true for the third- and
global luxury desirability orientation did show up. On a more fourth-order latent dimensions. Finally, a test of the
practical side, as recommended by Becker et al. (2012), we discriminant validity (Fornell and Larcker, 1981) shows that
relied on the repeated indicators approach with an inner path the conditions are met with respect to second- and third-order
weighting scheme and Mode A of measurement on the factors.
higher-order constructs. All in all, the eight first-order dimensions, hence, combine
Although the measurement and structural models are into broader macro variables, up to the luxury desire/dream.
simultaneously and iteratively estimated within the PLS The eight original factors are organized according to an axis
approach, the reliability and validity of the measurement from tangible (on the top) to intangible (at the bottom), from
model should be first assessed. As the adequacy of the physical to felt, from physical experience to symbolic image
first-order construct measurements has been verified, the (Figure 1 and Table II).
structural relationships among the constructs and the quality The aforementioned model reveals that two major distinct
of the overall structure of the model can then be assessed. paths do build the luxury desire. On the top of Figure 1, the
Although PLS does not provide any global goodness-of-fit four factors relate to the classical mode of luxury brand

Figure 1 PLS hierarchical confirmatory factor analysis of luxury desirability

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building. Luxury is not mass. It is just the opposite. It starts associated with very high ticket special items, inaccessibility),
with products, out of the ordinary, rich in emotions: superior these VIP’s build the “prestige level” of the brand. The last
quality, craftsmanship, full of hedonism and being the fruit of two factors of the model are on the one hand the creative, edgy
history and tradition. Luxury opposition to mass marketing is dimension of the brand and, on the other hand, its status and
also made through its selective distribution: very few stores but perceived leadership among all other brands of its class. Both
highly qualitative stores. It is important to be strict concerning factors merge into “creative leadership”. As a whole, these
where the stores will be located, how many will they be? In four factors constitute the “seduction path”. Looking at the
what type of town, of street, with what atmosphere? Both whole tested model, one can identify two structural paths of
factors create feelings of possessing something rare, which luxury dream building: selection and seduction.
does not mean just scarce, but also far above the ordinary. Finally, thanks to a systematic bootstrapped procedure, we
Although high quality is necessary, this is not sufficient to be compute the total effects from the overall global luxury
qualified as luxury: The products are also to be perceived as orientation (on the right) to the eight first-order dimensions
social and cultural markers. The brand must look exclusive: (on the left). The pattern displayed in Table IV provides
This is achieved through two factors. First, the brand needs to meaningful insights. All in all, the decomposition of the
convey that it is not for everybody: This is done by restricting influence of luxury desirability shows a noticeable dilution
its diffusion, limiting its accessible product lines, controlling effect even though all the coefficients are statistically
its prices and most of all taking care of whom is wearing it on significant. The dilution effect refers to the fact that at the
the streets. As Luigi Longinotti-Buitoni, former CEO of first-order level, the influence of luxury desirability is
Ferrari North America, says “Luxury brands must select mitigated by all the intermediate paths. For instance, the
customers for the brands are what their customers are” impact of luxury desirability on product superiority goes
(Longinotti-Buitoni and Longinotti-Buitoni, 1999, p. 148). through selection and objective rarity (hence, 0.982 ⫽ 0.958 ⫻
The second factor of exclusivity is more intangible: It refers to 0.953 ⫻ 0.977). It is worth noticing that by far and foremost,
the singular style of the brand, intemporal and yet remaining “product superior quality” (unique know-how, rare ingredients and
so original, actual. Exclusivity here refers to the permanence of exceptional beauty, with heritage) has the strongest indirect
the brand, remaining one of its kind, singular in its style or relationship to the global overall luxuriousness, immediately
behavior, also in the ability to always be very present in the followed by “gives class and status” and “selective distribution”,
media. As a whole, these four factors constitute what we called whereas “very actual and still unique” and “not for everybody” show
the “selection path”. the least incidences. This indicates that the product felt rarity
In the tested model, the bottom four factors are playing (instead of actual rarity) is of foremost importance. This is made
another game: fame. The glamour factor is constructed by the by a combination of singularities, both tangible and intangible.
celebrities believed or known to be buying the brand. They are Then, the brand must give class and status to its beholders, its
themselves very mediatized and contribute to make the brand: clients: This is the second role of the price paid. As reminded by
Audrey Hepburn made Tiffany and as Grace Kelly made Kapferer and Bastien (2012), luxury is like Janus, a two-faceted
Hermès. Together with the elitism factor (the brand being God: luxury for oneself, luxury for others. In third, one finds

Table IV Indirect bootstrapped effects and confidence intervals


Bootstrapped parameters
Independent variables Dependent variables Estimates t-tests Lower 95 % Upper 95 %
Luxury desirability Objective rarity 0.913 229.81 0.906 0.919
Luxury desirability Product superiority 0.892 200.63 0.884 0.899
Luxury desirability Selective distribution 0.800 95.73 0.788 0.816
Luxury desirability Exclusivity 0.660 23.96 0.614 0.709
Luxury desirability Not for everybody 0.597 22.44 0.553 0.644
Luxury desirability Very actual still unique 0.566 21.54 0.522 0.611
Luxury desirability Prestige 0.811 75.305 0.794 0.830
Luxury desirability Creative leadership 0.887 146.14 0.876 0.897
Luxury desirability Glamour 0.667 46.51 0.641 0.694
Luxury desirability Elitist 0.720 54.68 0.698 0.742
Luxury desirability Class and status 0.836 115.44 0.824 0.847
Luxury desirability Fashionable and creative 0.774 75.20 0.754 0.792
Seduction Class and status 0.889 172.24 0.880 0.898
Seduction Fashionable and creative 0.823 93.45 0.807 0.838
Seduction Glamour 0.709 50.62 0.683 0.736
Seduction Elitist 0.766 61.46 0.744 0.788
Selection Product superiority 0.930 253.48 0.924 0.937
Selection Selective distribution 0.835 101.63 0.823 0.849
Selection Not for everybody 0.624 23.30 0.580 0.670
Selection Very actual still unique 0.591 22.30 0.547 0.637

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selective distribution. One will never insist enough on the another business model, such as masstige for which looking
importance of the retail behavior of luxury brands: When should after volume is not an issue.
they stop opening new stores in a country or even start closing
stores there? This is also why e-commerce is both a blessing and Profiling the levers of each brand’s luxury and dream?
a threat: It aims at people who cannot find a store, but it is also In this study, respondents did not only express their
open to anyone, without any selectivity. Considering the 12 perception of the brand, of its behavior, of its marketing and
widely known brands purposely chosen as stimuli in this research influential mix, they also declared whether that particular
(leading luxury brands), it is no surprise that “not for everybody” brand “made them dream” and whether they considered it as
came last as building the luxury experience. Last does not mean “prototypical of luxury”. Indeed, what are the links of the
eight factors analyzed above and the dreamability of a specific
non-significant however. There is no luxury if it aims at all.
brand and its assessed luxury status? Naturally, the answers
Predictive validity analysis should differ per brand and per consumer. Some consumers
On an operational side, one question arises. Is the scale able to prefer bespoke brands, others just the opposite. Answering
differentiate between brands felt as both luxurious and dreamt these questions will validate the managerial as well as the
about from those which are not? All in all, 55 per cent of the theoretical scope of the proposed model of luxury desirability.
12 selected brands are both dreamt about and considered as A straightforward way to assess such a research question is to
luxurious by the respondents (85.7 per cent of the 12 brands perform simple analyses of variance between those who dream
and those who do not dream about the brand and the eight
are seen as luxury ones, whereas only 59.8 per cent of these 12
aforementioned dimensions, for each of the 12 selected
brands are dreamt about). A binary logistic regression
brands. The same holds true for the perception (or not) of the
confirms the predictive power of the scale with a medium
brand as being a luxury brand.
range pseudo R2Nagelkerke of 0.472 and a significant ␹2
(32.368; p ⫽ 0.0008) improvement over the null model. The dream profile of well-known brands
Overall, even if the model is able to predict 74.8 per cent of the With regard to the luxury factors that weight most on the
observed status of the brands, solely four of the eight “dreamability” or “dream value” of each brand, we chose to
dimensions have a significant Wald tests (5.80; 5.02; 4.61 and focus below on three highly successful brands: Louis Vuitton,
4.25, respectively, for “product superiority”, “fashionable and Giorgio Armani and Ralph Lauren. Despite their continuous
creative”, “selective distribution” and “not for everybody”). In growth, they still fuel the dream of many consumers. Table V
other words, this result means that these four first-order summarizes the main dream levers of these three luxury
brands based on whether the respondents were dreamers or
dimensions will increase the overall likelihood that the brands
not of that brand. These dream profiles are based on those
be considered both as luxurious and dreamt about.
factors which discriminate between those consumers who
One can consider that these four facets constitute the kernel
dream of the brand and those who do not. These dream profiles
of luxury attractivity, reminding that “product superiority” is
are of high interest for luxury executives. Looking at the
a factor which, in fact, combines tangible and intangible results in Table V, Louis Vuitton builds its dream value first
singularities such as heritage, beauty, know-how (as shown in through elitism (by always increasing its average prices,
the wording of the items loading on this first factor, see through charity auctions where artistic exceptional pieces are
Table III). A luxury brand is not a fashion brand: both are sold a million euros). Second, Louis Vuitton – as a leading
different business models (Kapferer and Bastien, 2012), but brand – provides a universal visa of class (at least, this is what
luxury must not make you look out of fashion. Luxury must be its dreamers believe). Superior quality/tradition/heritage
of its time, not stuck in the repetition or worship of its past. It comes as the third lever of the Louis Vuitton dream (the
must also differentiate its clients from the mass. There is a unique know-how of this historical Maison de Luxe). Fourth,
limit to the quantitative expansion of buyers and stores in highly communicating that it is bought by edgy celebrities
luxury, unless one just wants to look like luxury yet adopt endows the brand with glamour. Fifth, the perception of

Table V. Dream levers of three luxury brands (ANOVAs of dreamers versus non dreamers)
Louis Vuitton Giorgio Armani Ralph Lauren
Dream/non-dream
Elitist and expensive (3.48/3.04)a Status and class (4.17/3.98) (F ⫽ 13.6; p ⬍ 0.000) Status and class (4.08/3.96) (F ⫽ 24.0;
(F ⴝ 12.2; p < 0.001) p ⬍ 0.000)
Status and class (5.33/5.13) (F ⴝ 11.7; Product superiority (3.74/3.56) (F ⫽ 11.7; Selective distribution (3.69/3.11) (F ⫽ 14.0;
p < 0.001) p ⬍ 0.001) p ⬍ 0.000)
Product superiority (4.55/4.17) Fashionable (3.64/3.51) (F ⫽ 8.8; p ⬍ 0.004) Product superiority (3.58/3.27) (F ⫽ 10.9;
(F ⴝ 11.1; p < 0.001) p ⬍ 0.001)
Glamour (4.25/3.95) (F ⴝ 7.3; Glamour (3.35/3.66) (F ⫽ 7.9; p ⬍ 0.006) Glamour (3.29/3.09) (F ⫽ 7.6; p ⬍ 0.007)
p < 0.008)
Fashionable (3.98/3.47) (F ⴝ 4.0; Selective distribution (3.71/3.52) (F ⫽ 4.9;
p < 0.045) p ⬍ 0.028)
Note: a Mean values (dream/non-dream)

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fashion, however, is only marginally contributing to the Louis Louis Vuitton perceived luxuosity. Those who still perceive
Vuitton dream (as indicated by the almost non-significant). Louis Vuitton as luxury consider that:
Louis Vuitton remains a leather brand and fashion is only ● the brand has not lost its exclusivity at all, that it is still very
incidental there. actual;
Now if we look at Giorgio Armani’s dream, it is made first ● that it leads its category, gives great class;
of status/class and then of product excellence (superb ● that it has really superior products (craft, noble
materials, unique fabrics, style, know-how). Interestingly, the ingredients, with tradition); and
third lever of the Armani dream is the creativity, being ● that this brand is not bought by all kind of people today,
fashionable. Most interesting is the case of Ralph Lauren: that it remains not for everybody.
How is their dream built in Europe (where the brand is now
Only two of these factors also influence the dream of Louis
just expanding) and in France in particular? Ralph Lauren’s
Vuitton (status/gives class and exceptional products), but the
dream is strongly on its communication which expresses status
dream is first fueled by the amazingly high prices exhibited by
and class. It is also based on its very selective distribution
some products of this brand (even the smallest key holder is
policy in Europe (unlike in the USA). Ralph Lauren is above
worth more than €120) and by the halo of glamour around this
all a retail experience. In Europe, it does not advertise much,
brand (celebrities from the Arts, cinema, rich and famous
but the rare stores speak for themselves: They are real
clients), as well as its fashionability, being much talked about
mansions designed to make the buyer feel like he/she is in Mr
by the media or social networks (the sure consequence of
Ralph Lauren’s own home. Considering these data, this dream
hiring the fashion designer Marc Jacobs and now Nicolas
building distribution strategy is paying off. Ralph Lauren’s
Ghesquière).
dream is built by its incredible distribution.
To summarize, one finds that three of the four levers of
Dream versus luxury profile Louis Vuitton dream come from the seduction path. This is the
Are there differences between the dream profile and the luxury reverse of the perception of luxury: Three levers of four come
profile? Certainly, luxury largely fuels the dream, yet both from the selection path.
concepts have their specificities. In the present study, each
respondent evaluated one brand – among the 12 brands – on Positioning the luxury brands
34 Likert items. Respondents were also asked to categorize On a global basis, and to obtain a more comprehensive picture
this brand in a binary way on two accounts: Does this brand of all the brands encompassed in this study, we used a
make them dream (Yes/No) and do they consider that it is a multi-dimensional scaling approach to position the 12 brands
luxury brand (Yes/No)? It is interesting to compare the on a map based on their latent PLS scores on the 8 dimensions
determinants of each of these two judgments among the eight discussed above. The map is derived from Euclidean distances
factors identified above. Table VI summarizes such results for between the 12 brands using a metric multi-dimensional
Louis Vuitton, the world’s most valuable luxury brand analysis (PROXSCAL). The quality of the adjustment with
according to Interbrand and Millward Brown. Because of two dimensions is satisfactory (96 per cent of variance
Louis Vuitton’s systematic worldwide growth, critics voice accounted for; Tucker congruence coefficient: 0.984).
that this brand is not part of luxury anymore. However, year The map provides a clear picture (Figure 2) that shows
after year, Louis Vuitton has continued its growth, from Japan three groups of brands with, on the left-hand side, the long
to China and now new continents. This brand has been established luxury brands with a high history within the luxury
pioneer in demonstrating how one could grow, abandoning industry such as Chaumet, Louis Vuitton, Rolex and Yves
physical rarity and still remain considered by influential as Saint Laurent Couture and, on the right-hand side, brands
leading the luxury sector, at least up till now. In our study, perceived as having a higher diffusion. At the bottom right,
79.4 per cent of those who evaluated this brand (n ⫽ 136) one finds a group of “new world” brands, new comers such as
categorize it as luxury. But only 44.1 per cent say the brand Lexus, Ralph Lauren or Estee Lauder and, at the upper right,
makes them dream. This shows that although luxury more well-known brands, not edgy, probably held as masstige
companies like to say they sell a dream, this may not be the today by many, somehow more diffused and accessible. The
case for all. Here, half (45 per cent) of those holding Louis map clearly depicts that Longchamp and Louis Vuitton are on
Vuitton as luxury say that the brand does not make them the opposite sides of luxury: one accessible and discreet, the
dream. Let us analyze what factors explain their judgment. other flamboyant and expensive. Interestingly, Armani is in
It is interesting to notice that the determinants of the Louis the middle of the map, both classic, not recent and yet very
Vuitton dream are not exactly the same as the determinants of modern. Mauboussin, the price driven jeweler, based Place

Table VI Luxury drivers versus dream drivers of Louis Vuitton


Dream /non-dream Luxury/non-luxury
Elitist and expensive (3.48/3.04) (F ⴝ 12.2; p < 0.001)
a
Actual still unique (3.80/3.04) b (F ⫽ 11.7; p ⬍ 0.001)
Status and class (5.33/5.13) (F ⴝ 11.7; p < 0.001) Status and class (5.25/5.08) (F ⫽ 9.1; p ⬍ 0.003)
Product superiority (4.55/4.17) (F ⴝ 11.1; p < 0.001) Product superiority (4.41/4.09) (F ⫽ 6.8; p ⬍ 0.010)
Glamour (4.25/3.95) (F ⴝ 7.3; p < 0.008) Not for everybody (4.16/3.73) (F ⫽ 3.7; p ⬍ 0.05)
Fashionable (3.98/3.47) (F ⴝ 4.0; p < 0.045)
a
Notes: ANOVAs of dream/non-dream and luxury/non-luxury on each factor; mean values (dream/non-dream); b mean values (luxury/non-luxury)

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Figure 2 MDSⴱ (PROXSCAL) map of the 12 luxury brands

PREFSCAL Mapping

2
Mercedes

Longchamp

1
Rolex
Dimension 2

Mauboussin

0 Louis Vuitton

Chaumet
Giorgio Armani
Yves Saint Laurent Couture

Lexus
–1

Ralph Lauren

Estee Lauder

–2

–3

–4 –2 0 2

Dimension 1

Notes: *Euclidean representation of distances between the 12 brands with regard to their means
values on the 8 first-order dimensions

Vendome, is now perceived where it stands: on the high dreams in which products and services which are unique,
diffusion side, as it moved out of pure Luxury Strategy to exclusive, beautiful, rich and glamorous are created to
increase its volume through lowering the price range and exceed the customers’ imagination” (Longinotti-Buitoni
extending distribution worldwide. and Longinotti-Buitoni, 1999, p. 40), yet all luxury brands
do neither convey the same amount of dream nor the same
Implications and conclusion dream. Some luxury brands even lack of dream: They rely too
This research has both theoretical as well as managerial much on the upper path of our luxury building integrated
implications. On theoretical grounds, it calls the attention on model, selectivity based on tangibles and exclusivities – either
the need to take full account of the brand itself, besides the virtual or real. Reversely, some brands can carry a dream while
classic product-related facets of luxury. In modern luxury, not being fully perceived as luxury. This is the case of Audi in
having an emotionally intense product certainly remains the our study: Compared to Mercedes or BMW, this brand is
cornerstone of brand building. But with time, it is also rather recent, thus has neither history nor tradition. Its slogan
necessary to endow the brand with a high seductive symbolic is oriented toward the future: “Progress through technology”.
capital that can be passed onto the customers themselves. Interestingly, it has a higher dream value than one would
Based on a PLS fourth-order modelization, we have identified expect on the basis of the luxury perception of the brand. It is
the levers and paths of luxury dream building. possible that the levers of luxury perception are not just
On theoretical grounds, it is also interesting to explore mirroring those of dream building. For Louis Vuitton, this is
the relationships between the dream potential and luxury. just the case.
Certainly, as said by Ferrari’s North America CEO, “So On operational grounds, this research provides a new model
called luxury companies best exemplify an industry of for brand management: Starting at the operational side, the

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one experienced by customers too, it shows how higher-order Godey, B. (2013), “A cross cultural exploratory content
perceptions of value are built, up to the final desire for the analysis of the perception of luxury”, Journal of Product and
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