Académique Documents
Professionnel Documents
Culture Documents
www.emeraldinsight.com/0263-4503.htm
Luxury brand
management
Introduction
Developments in Web 2.0, defined by user-generated contents (UGC) and social
networking sites (SNSs), have significant implications for consumption and the
study of consumer cultures (Beer and Burrows, 2010). The internet has enabled a new
era of UGC, threatening the hegemony of traditional content generators like one-way
advertising and expert reviewers as the primary sources of legitimate information
(Dhar and Chang, 2009). The transparent nature of the web has paved the way for UGC
and SNSs to become a legitimate, trusted voice that resonates with consumers.
As brands are increasingly embedded in SNSs (e.g. Facebook and Twitter) and other
variant forms of social media (e.g. YouTube), the competition between brands has
become a battlefield where companies co-own their brands, co-direct their brands
competitive strategies, and co-define symbolic meanings of their brands with their
consumers (Heil et al., 2010; Tynan et al., 2010). User-generated branding (UGB),
defined as the strategic and operative management of brand-related user-generated
content (UGC) to achieve brand goals (Burmann et al., 2009, p. 66), is rooted in the
theoretical framework of the identity-based brand management approach, which views
brand identity as consumers self-reflection (Burmann and Arnhold, 2009). In light of
this symbolic function of brands in consumer identity construction, the present study
examined value-expressive and social-adjustive functions of luxury brands in the
context of social media.
Luxury brands are expected to evoke uniqueness and exclusivity through high
quality, premium pricing, and controlled distribution. With the exponential growth of
687
Received 28 November 2011
Revised 31 May 2012
Accepted 10 July 2012
MIP
30,7
688
SNSs and various social media, however, luxury brands face challenges in how to
maintain brand integrity while harnessing the power of UGC and SNSs. The primary
channel of retailing for luxury brands is offline stores since luxury brands pursue
uniqueness and exclusivity through strictly controlled distribution. Luxury brand
managers encounter a dialectical tension between the need to keep up with the social
media trend and the need to maintain their brand integrity and exclusive reputation.
Social media are a Pandoras box for luxury brands because they can serve as a virtual
brand community (a specialized, non-geographically bound community, based on
a structured set of social relationships among admirers of a brand (Muniz and
OGuinn, 2001, p. 412)) and a virtual anti-brand community (online space that focusses
on negative attention on a specific targeted brand (Krishnamurthy and Kucuk,
2009, p. 1119)) simultaneously because of their versatile and unpredictable nature.
Brand communities are groups of users and admirers of a brand who engage jointly in
group actions to accomplish collective goals and express mutual sentiments and
commitments (Stokburger-Sauer, 2010). In contrast, anti-brand communities, involving
social interactions among customers who mobilize collective actions against a brand,
provide these consumers with a forum to voice discontent, facilitate the exchange
of anti-brand information, and promote boycotts and lawsuits (Krishnamurthy
and Kucuk, 2009). With the evolution and expansion of social media and brands
increasing virtual presence within social media, the clear dividing line between
brand communities and anti-brand communities has been blurred; that is, positive
UGC and negative UGC co-exist in social media, thus functioning as both pro-brand
and anti-brand communities. Consumers may promote their favored brands by posting
positive comments on the brands Facebook pages and Twitter or uploading favorable
video clips to YouTube. At the same time, consumers may use brands social media as
complaint forums by posting negative comments about an unsatisfactory transaction
with a company.
The need to understand the dynamics of consumer-brand relationships formed and
metamorphosed via versatile UGC embedded in social media is an impetus for
proposing a model comprising various antecedents to and consequences of consumers
brand attitude in the novel context of brands social media interfaces. In this regard,
the present research examined the marketing potential of social media as a tool for
luxury brand management and addressed the challenges luxury brands encounter in
managing their interactive and dynamic relationships with consumers who utilize
social media.
Luxury brands and social media
Luxury brands account for a significant portion of consumer product sales. Sales
revenue of Louis Vuitton Moet Hennessy (LVMH), the worlds largest luxury brand
group, was 20,320 million euros in 2010 (Bloomberg.com, 2011). Despite the economic
decline in recent years, LVMHs net profit and total equity have consistently increased.
Expecting to generate more than 190 billion euros in worldwide sales in 2011, luxury
industries are experiencing strong annual growth in terms of both value and volume.
The buoyant luxury goods sector implicates the need for a better understanding
of driving factors that encourage luxury brand consumption and the significance of
research on luxury brand management in the current social and media environments.
Accordingly, the present study delved into the social psychological mechanisms
underlying the unique integration of luxury brands and social media whereby luxury
brands company-generated contents and consumer-generated contents co-exist.
Luxury brand
management
689
MIP
30,7
690
correlation between luxury brand attitude prior to the social media visit and luxury
brand attitude after the social media visit:
Luxury brand
management
H3. Consumers attitude toward a luxury brand before visiting the luxury brands
Facebook is a positive predictor of consumers attitude toward the luxury brand
after visiting the luxury brands Facebook.
Consumers brand attitude strength predicts their behaviors of interest to firms,
including brand consideration, intention to purchase, purchase behavior, and
brand choice (Priester et al., 2004). Thus, brand attitude is a crucial brand equity
driver in brand management (Park et al., 2010). This study examined the predictive
role of brand attitude after consumers explore the luxury brands Facebook in
determining the extent to which they are willing to utilize Facebook for online
shopping (H4) and (re)visit the luxury brands Facebook and other social media like
Twitter (H5):
H4. Consumers attitude toward the luxury brand after visiting the luxury brands
Facebook is a positive predictor of their interest in utilizing Facebook for online
shopping.
H5. Consumers attitude toward the luxury brand after visiting the luxury
brands Facebook is a positive predictor of their intention to revisit the
luxury brands social media.
This research also examined the influence of consumers satisfaction with a luxury
brands Facebook interface on brand attitude after their Facebook visit. To maintain
a long-term relationship with consumers and improve consumers favorable attitude
toward the brand, it is integral for the company to provide satisfactory user interfaces
for social media in which the brand and relevant UGC (consumer-generated brandrelated content) are embedded:
H6. Consumers satisfaction with the luxury brands Facebook is a positive
predictor of their attitude toward the luxury brand after visiting the luxury
brands Facebook.
The escalating growth of the luxury goods industry reflects the trend that
consumers are increasingly pursuing products that provide emotional benefits
(Hagtvedt and Patrick, 2009). Hagtvedt and Patrick (2009) theorized that the
connotations of pleasure that accompany a luxury brand distinguish it from the
utilitarian benefits conferred by a value brand. They found that luxury brands are
more extendible than value brands by virtue of their hedonic potential and their
promise of emotional pleasure. The extant literature indicates that two different
shopping motivations (hedonic motivation v. utilitarian motivation) (Babin et al.,
1994) affect online shopping attitudes (Childers et al., 2001), ROPO intentions
(To et al., 2007), and online shoppers flow experiences (Novak et al., 2003). Therefore,
understanding the role of consumers hedonic motivation and hedonic choice
behavior is integral to luxury brand management. To this end, in addition to structural
equation modeling (SEM) analyses, the current study examined the influence of
consumers motivational orientations (hedonic motivation v. utilitarian motivation)
691
MIP
30,7
measured by hedonic choice v. utilitarian choice on the main variables to answer the
following research question:
692
Facebooks overall design; Louis Vuitton Facebooks recent updates; Louis Vuitton
Facebooks profile picture; Louis Vuitton Facebooks information section; Louis
Vuitton Facebooks journey section; Louis Vuitton Facebooks photos section;
Louis Vuitton Facebooks video section; and Louis Vuitton Facebooks interaction
with consumers (a 0.898, M 4.422, SD 1.084). Each item was measured by
a seven-point scale ranging from I am very dissatisfied (1) to I am very satisfied (7).
Hedonic choice v. utilitarian choice. Between these two options, which one would
you like to choose?: $1,500 designer (Chanel, Louis Vuitton, Prada, or Gucci) female or
male bag to pick up within two weeks v. $1,500 target gift card that expires within two
weeks. Out of 112 participants, 46 people (41.1 percent) chose the $1,500 designer bag,
and 66 people (58.9 percent) chose the $1,500 grocery gift card. This choice behavior
question was asked before participants explored Louis Vuittons Facebook.
Endogenous variables. Brand (Louis Vuitton) attitude was measured by asking
participants to rate the brand (Please rate Louis Vuitton brand) using 13 items: good;
favorable; positive; important; useful; appealing; pleasant; attractive;
friendly; satisfying; agreeable; worth trying; and worth buying. Each item
was measured by a seven-point scale ranging from not at all (1) to very much (7).
Attitude toward the Louis Vuitton brand was measured both before (Z1) (a 0.966,
M 4.337, SD 1.624) and after (Z2) (a 0.957, M 4.438, SD 1.433) visiting the
brands Facebook page. Intention to use Facebook for online shopping (Z3) was
measured by five items after visiting Louis Vuittons Facebook page: I am interested
in utilizing Facebook to follow-up on luxury brands online updates; I am
interested in utilizing Facebook to browse luxury brands I like; I am interested
in utilizing Facebook for online shopping in general; I am interested in utilizing
Facebook for shopping luxury brands online; and I am interested in
utilizing Facebook to refer to consumer reviews (a 0.950, M 2.241, SD 1.429).
Each item was measured by a seven-point Likert scale ranging from strongly
disagree (1) to strongly agree (7). Behavioral intention to use Louis Vuittons social
media (Z4) was measured by six items after participants visited Louis Vuittons
Facebook page: I would like to add Louis Vuitton as my Facebook friend;
I would like to visit Louis Vuitton Facebook again; I would like to share Louis
Vuitton Facebook with my Facebook friends online; I would like to share
Louis Vuitton Facebook page with my offline friends; I would like to visit Louis
Vuittons official web site listed on its Facebook page; and I would like to visit
Louis Vuittons Twitter listed on its Facebook page (a 0.930, M 2.558, SD 1.350).
Each item was measured by a seven-point Likert scale. Intention to ROPO (Z5) was
measured by four items after participants visited Louis Vuittons Facebook page:
If I purchase products from Louis Vuittons offline stores, I will visit Louis Vuittons
Facebook online before making an offline purchase; If I purchase products from
Louis Vuittons offline stores, I will visit Louis Vuittons Twitter online before making a
purchase; If I purchase products from other luxury brands offline stores, I will
browse their Facebook before making a purchase; and If I purchase products from
other luxury brands offline stores, I will browse their Twitter before making
a purchase (a 0.936, M 2.027, SD 1.164). Each item was measured by a
seven-point Likert scale.
Data analysis (SEM procedures)
The model was tested using maximum likelihood procedures in LISREL 8.8. The fit
of the hypothesized model to the observed correlations of the data was evaluated using
Luxury brand
management
693
MIP
30,7
694
three methods: the significance of the w2-statistics was tested. Also, since w2 is sensitive
to sample size, degrees of freedom (df) are the appropriate standard by which
researchers judge whether the w2 is large or small. A ratio of w2 to df (w2/df) of o5,
recommended by Wheaton et al. (1977), was used as an appropriate criterion; goodness
of fit index (GFI) and adjusted goodness of fit index (AGFI) (i.e. GFI adjusted for df)
were examined; and the root mean squared residuals (RMR) was assessed as an
estimate of the average magnitude of the fitted residuals. The root mean square error
of approximation (RMSEA) is a measure of discrepancy per df between the model
and the data (Jorsekog and Sorbom 1999). Conventionally, cutoff values of .90 or higher
for the normed fit index (NFI) and non-normed fit index (NNFI) and values of .05 or
lower for the RMR and RMSEA are indicators of a well-fitting model (Bollen, 1989).
Results
Preliminary analysis
Table I presents correlations for the data.
Primary analysis
Overall model fit of the theoretical model at the global level. The overall fit of the model
was very good w2 (df 17) 27.27, p40.05, which indicates that the hypothesized
(theoretical) model is not different from the sample data. Furthermore, the model
produced the ratio of the w2 to the df (w2/df) 1.60, a figure below the criterion value
of 5. The proposed model had a RMR value of 0.08, a RMSEA of 0.07, a NFI of 0.95, a
NNFI of 0.96, a comparative fit index value of 0.98, a GFI of 0.94, and an AGFI
of 0.94, which altogether indicates a very good fit to the data.
Model component assessment of the theoretical model at the local level. All the b and g
coefficients were significant. Interest in utilizing Facebook for online shopping
positively predicted intentions to visit the luxury brands social media (b43 0.30,
t 3.89, po0.05). Intentions to visit the luxury brands social media positively
predicted ROPO intentions (b54 0.59, t 7.53, po0.05). Consumers perceived
value-expressive function of a luxury brand positively predicted their attitude toward
the luxury brand before visiting the luxury brands Facebook (g11 0.23, t 2.07,
po0.05), supporting H1. Consumers perceived social-adjustive function of a luxury
brand positively predicted their attitude toward the luxury brand before visiting the
Variables
Table I.
Zero-order correlations
x1
VEF
x2
SAF
x3
SAT
Z1
Z2
Z3
BApre BApost OSFB
Z4
INT
Z5
ROPO
1
0.663** 1
0.140
0.449**
0.478**0
0.185
0.154
0.484**
0.460**
0.258**
1
0.300** 1
0.547** 0.845** 1
0.079 0.248** 0.297** 1
luxury brands Facebook (g11 0.33, t 3.01, po0.05), supporting H2. Consumers
attitude toward a luxury brand before visiting the luxury brands Facebook was
a positive predictor of consumers attitude toward the luxury brand after visiting
the luxury brands Facebook (b21 0.75, t 17.72, po0.05), H3 was supported.
Consumers attitude toward the luxury brand after visiting the luxury brands
Facebook positively predicted their interest in utilizing Facebook for online shopping
(b32 0.30, t 3.06, po0.05), thus supporting H4. Consumers attitude toward the
luxury brand after visiting the luxury brands Facebook was a positive predictor of
intention to (re)visit the luxury brands social media (b42 0.51, t 6.38, po0.05), thus
supporting H5. Consumers satisfaction with the luxury brands Facebook positively
predicted consumers attitude toward the luxury brand after visiting the luxury
brands Facebook (g23 0.32, t 7.64, po0.05), supporting H6. The data produced
a very well-fitting model, and every individual hypothesis was supported. Figure 1
summarizes the results of testing the overall model fit at the global level and the
individual hypotheses as model components at the local level.
Between-subjects independent samples t-tests were conducted to answer the
research questions. The results indicated that consumers who chose hedonic luxury
goods ($1,500 designer bag) demonstrated stronger value-expressive attitudes and
social-adjustive attitudes toward the luxury brand, more positive attitudes toward
the luxury brand before and after exploring the brands Facebook, greater satisfaction
with the luxury brands Facebook interface, greater intentions to (re)visit the luxury
brands social media, greater ROPO intentions, and greater intentions to utilize
Facebook for online shopping than those who chose utilitarian necessity goods ($1,500
grocery coupon). Table II summarizes the results of the t-tests.
Luxury brand
management
695
Discussion
This exploratory study tested the marketing potential of social media for luxury brand
management. SEM analyses were conducted to elucidate the dynamic relationships
Results of SEM Analysis
2 = 27.27,
df = 17, p-value > 0.5,
RMSEA = 0.07
Valueexpressive
function
11=
1
0.23*
32=
Brand attitude
(pre-test)
21=
0.75*
1
Social-adjustive
function
12=
0.30*
3
Brand attitude
(post-test)
43=
2
42=
0.33*
Online shopping
via facebook
0.51*
0.30*
Intention to visit
the brands
social media
4
54=
0.59*
Intention to
ROPO
the brand
5
2
23=
Satisfaction
with brands
facebook
3
0.32*
Figure 1.
Results of SEM analysis
MIP
30,7
696
Table II.
Independent samples
t-test results
Dependent variables
Value-expressive function
Social-adjustive function
Pre-brand attitude
Facebook satisfaction
Post-brand attitude
Facebook online shopping intentions
LVs social media visiting intentions
LV ROPO intentions
(1.67)
(1.23)
(1.48)
(1.05)
(1.17)
(1.68)
(1.37)
(1.39)
3.03
3.85
3.67
4.24
3.87
2.00
2.02
1.80
(1.41)
(1.55)
(1.38)
(1.08)
(1.32)
(1.18)
(1.05)
(0.92)
t
4.25**
4.47**
5.91**
2.17*
5.74**
2.15*
5.69**
2.49*
Luxury brand
management
697
MIP
30,7
698
Novak, T.P., Hoffman, D.L. and Duhachek, A. (2003), The influence of goal-directed and experiential
activities on online flow experiences, Journal of Consumer Psychology, Vol. 13 Nos 1-2, pp. 3-16.
Otto, J. and Chung, Q. (2000), A framework for cyber-enhanced retailing: integrating e-commerce
retailing with brick and mortar retailing, Electronic Markets, Vol. 10 No. 4, pp. 185-91.
Park, C.W., MacInnis, D.J., Priester, J., Eisingerich, A.B. and Iacobucci, D. (2010), Brand
attachment and brand attitude strength: conceptual and empirical differentiation of two
critical brand equity drivers, Journal of Marketing, Vol. 74 No. 6, pp. 1-17.
Priester, J.R., Nayakankuppam, D., Fleming, M.A. and Godek, J. (2004), The A2SC2 model: the
influence of attitudes and attitude strength on consideration and choice, Journal of
Consumer Research, Vol. 30 Nos 1-2, pp. 574-87.
Shavitt, S. (1989), Products, personalities and situations in attitude functions: implications for
consumer behavior, in Thomas, K.S. (Ed.), Advances in Consumer Research, Vol. 16.
Association for Consumer Research, Provo, UT, pp. 300-5.
Shavitt, S., Lowrey, T. and Han, S.-P. (1992), Attitude functions in advertising: the interactive role
of products and self-monitoring, Journal of Consumer Psychology, Vol. 1 No. 4, pp. 337-64.
Smith, D., Menon, S. and Sivakumar, K. (2005), Online peer and editorial recommendations, trust,
and choice in virtual markets, Journal of Interactive Marketing, Vol. 19 No. 3, pp. 15-37.
Steinfield, C., Bouwman, H. and Adelaar, T. (2001), Combining physical and virtual channels:
opportunities, imperative and challenges, paper presented at the Bled Electronic Commerce
Conference, Bled, available at: http://ecom.fov.uni-mb.si/proceedings.nsf/Proceedings/
9E382E6025D09181C1256E9F00327A78/$Fi le/50_Steinfield.pdf (accessed March 3, 2011).
Stokburger-Sauer, N. (2010), Brand community: drivers and outcomes, Psychology &
Marketing, Vol. 27 No. 4, pp. 347-68.
Tasi, S.-p. (2005), Impact of personal orientation on luxury-brand purchase value, International
Journal of Market Research, Vol. 47 No. 4, pp. 429-54.
To, P.-L., Liao, C. and Lin, T.-H. (2007), Shopping motivations on internet: a study based on
utilitarian and hedonic value, Technovation, Vol. 27 No. 12, pp. 774-87.
Tynan, C., McKechnie, S. and Chhuon, C. (2010), Co-creating value for luxury brands, Journal of
Business Research, Vol. 63 No. 11, pp. 1156-63.
Wheaton, B., Muthen, B., Alwin, D.F. and Summers, G.F. (1977), Assessing reliability and
stability in panel models, in Heise, D.R. (Ed.), Sociological Methodology, Jossey-Bass Inc,
San Francisco, CA, pp. 84-136.
Whitten, P., Steinfield, C. and Hellmich, S. (2001), Ehealth: market potential and business
strategies, Journal of Computer-Mediated Communication, Vol 6 No. 4, available at: www3.
interscience.wiley.com/cgi-bin/fulltext/120837825/HTMLSTART (accessed March 3, 2011).
Wilcox, K., Kim, H.M. and Sen, S. (2009), Why do consumers buy counterfeit luxury brands?,
Journal of Marketing Research, Vol. 46 No. 2, pp. 247-59.
About the author
Seung-A Annie Jin is an Assistant Professor in the Communication Department, Boston College
and her research revolves around the theme of social psychological effects of new media and
interactive communication technologies (e.g. social media, 3D virtual reality, video/computer
games, robotics, and haptics) in e-health and e-commerce. Her work has been published in
Journal of Communication, Journal of Health Psychology, Journal of Interactive Marketing,
Psychology & Marketing, Journal of Brand Management and Cyberpsychology, Behavior, and
Social Networking, among others. Seung-A Annie Jin can be contacted at: seunga.jin.1@bc.edu
To purchase reprints of this article please e-mail: reprints@emeraldinsight.com
Or visit our web site for further details: www.emeraldinsight.com/reprints
Luxury brand
management
699