Is There A Reason Why Luxury Brand Marketing Costs Are Noble?

Zhou Ting, President of the luxury goods field and President of the Institute of wealth and quality, pointed out that the cost of Gucci is only 24 euros, which is taken out of context, because this is just one of many links in its production, and many other links fail to calculate the cost. The proportion of the cost of production costs is only a small figure. Some luxury goods only cost up to 50%-60%.

In fact, the brand value of luxury goods costs has become an important one.

In addition, taxes and taxes are also part of the price.

For example, the price of local luxury brands in France is cheaper than that in China, and the price difference is about 20%, which is mainly due to taxes and fees.

In the luxury industry, such a cost calculation formula is popular: "raw material + processing cost + luxury brand value + market public relations cost + flag ship's annual cost + tariff and government tax rate = actual sales price", in which the cost of raw materials is often less than 10%.

The industry believes that the success of a luxury brand is the result of continuous operation and investment.

Besides marketing and maintenance, its own brand value, such as celebrity effect and historical story, are all expensive factors.

In other words, brand value is the most important part of the price composition of luxury goods. The value of luxury goods is quite different from the value of sale because the true value of luxury lies in brand, not in itself.

In 1869, Egyptian Pasha (governor) Ishmael ordered a leather suitcase from Louis Weedon.

After that, in 1877, Russian crown prince Nicola and King Spain twelve became the users of the Louis Weedon brand.

More than 100 years ago, the Custom Boxes for the royal family had already started. This is enough to make consumers attractive and let Louis Weedon become a truly world luxury brand.

Consumer demand for luxury goods has already surpassed the value of goods, and more is a spiritual satisfaction.

"In this industry, price is not a problem.

If the price is low, it will be cold. "

Yang Yang, who has been in the luxury industry for more than 10 years, has told reporters that luxury goods are not ordinary commodities strictly.

The supply relationship has changed greatly.

When the cost of luxury goods goes up, it will rise in price.

"However, the cost of many luxury brands is indeed high.

For example, Burberry[micro-blog has a waterproof, crease resistant, breathable and durable fabric, which is a purely manual process.

A staff member of Dolce&Gabbana also told reporters that the company sometimes preferred to destroy or destroy the goods that had been damaged for the season or some damaged items.

"The consumption crowd of luxury goods is there, the price is really a floating cloud.

Even in the off-season, customers are scarce and seldom sell at a discount.

If discount or price reduction, it will give customers an illusion whether the quality of products is problematic or the style is out of date.

A few years ago, after the approval of the headquarters, the design may be launched in a specific period, and there will be a small discount for such products.

Discounts are generally the lowest level of luxury goods consumers, with a monthly salary of over 10000 yuan.

Mainstream people still like to buy new models and don't care about prices. "

Yang Yang said that luxury is not only a necessity of people's life, but a commodity with the characteristics of "uniqueness", "scarcity" and "curiosity".

After meeting the basic needs of life, people also need some things to improve the quality of life. The luxury industry of "elegance", "refinement" and "individuality" is catering to people's needs.

Therefore, the price of luxury goods is dozens of times, hundreds or even thousands of times the price of the same kind of ordinary goods. This is also a marketing strategy for luxury goods. It must be distinguished from other commodities. People who buy luxury goods may like their designs, perhaps they like them.

Perhaps it is to show their social status, the difference between their cost and selling price will not be too concerned. For those who are concerned, it is often the non mainstream people who buy luxury goods. They want to buy and cannot afford it. Naturally, they are more serious about luxury work or origin and cost.

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Ouyang Kun, the chief representative of China Representative Office of the World Luxury Association, analyzes whether the Chinese purchase luxury goods is not dependent on their income and age, but on their consumption psychology.

In the luxury industry, price is only a symbol. Brand branding brings consumers unlimited glory: low-key design, traditional workshop style production, limited customization.

Luxury brands are painstakingly designed to make consumers feel mysterious. They will also use luxury goods as a symbol of their identity. This is also the result of many years of precipitation and brand maintenance.

However, it is undeniable that the overall profit margin of the luxury goods industry is now declining.

Some analysts believe that, whether from the domestic market or the international market, there are more and more doubts about the cost of luxury goods. It also reflects the rational trend of consumers from one aspect.