I’ve frequently written about the importance of the customer relationship when selling luxury. I’ve focused on the need to use the right language and gestures to create an environment of elegance and grace. But, until now, I hadn’t thought about intimacy and how it relates to luxury.
As usual, last Sunday’s New York Times featured the Tiffany & Company advertisement regularly found at the top of page 3. This time the image was of the multi-heart Return to Tiffany (RTT) bracelet (shown). Seeing as it was January 3rd, I wasn’t sure if someone in Tiffany’s advertising department might have a sense of humor. This particular bracelet, with all those little RTT hearts, and the timing of the ad made me think of all the post-holiday customers “returning” their unwanted presents to Tiffany. Though it’s hard to imagine someone wanting to return a Tiffany gift, it does happen. During my tenure there, we were especially concerned at this time of year about keeping up sales associates’ spirits while ensuring customers still received exceptional service. Continue reading
Daniel Humm is the chef and owner for the Michelin three-star restaurant Eleven Madison Park and The NoMad in New York City. He’s also the recipient of six James Beard Awards, four stars from the New York Times and the S. Pellegrino Chef’s Choice 2015 award. Mr. Humm was recently interviewed by New York Magazine and asked how me keeps his team motivated. He replied:
We treat every service as if it’s the only one that matters, the same way a sports team prepares for a championship match. Everything we do is done with intention and the desire to make the guest’s experience the best it can be.
This great infographic came into my LinkedIn feed and I thought it worthwhile to share with you. Hope you think so too!
With over 90 properties and over 40,000 employees Ritz-Carlton consistently earns top honors in most rankings of luxury hotels. And so it’s no surprise that Ritz Carlton earned top honors a study conducted by Luxury Branding, a London-based consultancy that specializes in the global luxury market. Yet other well-recognized luxury hotel brands, such as Four Seasons and Peninsula, did not fare so well (13th and 20th, respectively), with the Waldorf Astoria rating an embarrassing 50th. By using TripAdvisor rankings as its data source, the study examines whether luxury hotels are truly delivering 5-star service or are just resting on their laurels. The study’s results are sampled from over 2.25 million public reviews on TripAdvisor. (The study is available as a free download from the website). Continue reading
My husband and I recently spent a week vacationing on the beautiful island of Crete. Despite the financial challenges the citizens of Greece are facing, we were unfailingly welcomed with smiles, generosity and meraki. ‘Meraki’ is a Greek word that is somewhat difficult to translate. Perhaps the best definitions of meraki are “to do something with soul, creativity, or love,” or in other words “to put something of yourself into what you’re doing.” Continue reading
This Harvard Business Review post, “Luxury’s Talent Factories,” discusses how large luxury conglomerates such as LVMH, Kering and Richemont actually drive talent performance. Most management research would argue the opposite. It’s generally accepted that companies can increase their financial returns by focusing on core lines of business. Contrary to this evidence, the article states: “Diversification generally does not add value unless there are significant cost savings and operational synergies across units—which isn’t necessarily the case with all luxury groups.”
Diversification generally does not add value unless there are significant cost savings and operational synergies across units—which isn’t necessarily the case with all luxury groups.
According to the article, here are some of the reasons the “Big 3” are able to use their size to their business advantage in developing luxury talent:
Mobility – Diversification of internal brands means that employees who move from subsidiary to subsidiary bring a core set of brand values and skills. They are also better able to build their personal networks across multiple internal brands. The advantage to the enterprise is that they’re able to leverage talent when and where they need it.
Best practices – The organization can identify and transfer best practices across products, and gain the benefit of new perspectives at the same time. In one case, CRM talent from a fashion group was brought in to help build a CRM function for a watch brand.
International Experience – Cross-cultural exposure inspires creativity and provides exposure to a larger pool of manufacturers and suppliers.
Understanding the Global Customer – As technology and social media create a growing international marketplace, it’s imperative that brands understand how luxury customer expectations vary from country to country.
Although Europeans can explain to customers what luxury means, they also must have experience in foreign markets to understand which aspects of luxury the customers there actually care about. For example, in America consumers will buy watches for their functionality or performance, whereas in Asia it’s more about the prestige of the brand.
The three large luxury groups are able to leverage these advantages for the individual as well as for the enterprise. It only works, however, when the group is able to keep its brands relevant and continuously invests in developing premium talent.
Milton Pedraza, CEO of Luxury Institute recently confirmed, “Luxury brands lose half of their top customers every year. The biggest reason why a consumer won’t come back is not the product—it’s a rude or inattentive salesperson” (The new face of luxury: breaking down the myths and stereotypes of the luxury shopper). On the surface this statement seems to contradict the finding of a recent study titled, Should the Devil Sell Prada? Retail Rejection Increases Aspiring Consumers’ Desire for the Brand (October 2014 Journal of Consumer Research). The study (co-authored by Dr. Darren Dahl, a marketing professor at the Sauder School of Business and Prof. Morgan Ward of the Cox School of Business) found customers who receive poor treatment from sales associates in a luxury retail environment are more likely to make a purchase.
Luxury brands lose half of their top customers every year. The biggest reason why a consumer won’t come back is not the product—it’s a rude or inattentive salesperson
When customers have a higher expectation of service, as in the luxury sector, the potential for customer dissatisfaction increases. I may not expect a hand-written thank-you note after purchasing a fashion ring at Macy’s, but I’d be surprised not to receive one if I bought a yellow-diamond pendant at Tiffany & Co. Because the service expectations of the luxury customer are so high, complaints need to be handled with extra care.
The goal, of course, is to prevent customer complaints altogether by listening attentively to the customer and ensuring seamless service. But things can and do go wrong, even in a luxury environment. When they do, it’s important to remember to act with grace. The dictionary defines ‘grace’ as a polite or pleasant way of behaving. It’s important to note as well, that the word ‘grace’ comes from the Latin gratia—to give thanks. Many people say grace before a meal in order to express gratitude. In the same way, a complaint can be seen as a gift. It presents an opportunity to exceed customer expectations and create loyalty. When we handle the complaint with grace, we are thankful for this gift.
When a customer is dissatisfied with your product or service, here are six steps you can follow: Continue reading