Changing times for luxury brands

Picture this: In remote Yamunanagar, a farmer gifts his only son a pristine white BMW 3 Series on his 21st birthday. The son immediately takes the brand new 'ultimate driving machine' for a spin. The son, Akash, then takes the car close to the river and finally, lo and behold, he drives it overboard! Locals said that he jumped out of the vehicle just before it reached deeper water and onlookers helped him to safety. Reason? He wanted a Jaguar XF and BMW is "too small" for him and his friends. The boy's father told media, "I wanted to give my son a birthday present. We could only afford to give him a BMW, while he kept on insisting that he be given a Jaguar. He said the vehicle was too small but we thought he will be okay with the BMW."

Now this stray incident took place in a remote Haryana village. The video of the drowning car not only became viral in India but also made it to international news channels like Fox News, which very smartly embedded ads of Jaguar's latest models in the news.

In today's global village, crisis can come from all quarters. For any luxury brand, this category is a typical buyer community that thrives on "ego" and "flaunt quotient". They are cash rich and their basis of selection of brand is typically their perception of the extent it will give them a higher status within their community. So if they think Jaguar is the aspiration and BMW is "too small", so much so that it should be thrown away into the river, this is a big jolt to brand equity of the latter and a huge boost for the former. I will not be surprised if Jaguar sales rise in that belt and BMW's plummet.

So such stray incidents need immediate crisis management. Every luxury brand knows that their forte lies is creating a perception and managing it. A luxury product is like a ticket to a dream world conjured by brand custodians. As long the dream is alive, the perception is alive as well and so a brand keeps thriving and thus charging a premium.

With the onset of digital media the crisis management has become a very tough task as the speed of news has become real time. And crisis can now hit the company from any geography. So perception management as well as brand equity management has become a real time job. No longer can a brand afford to wait for a day to prepare a media release. Gone are those days. Long gone. In today's day and age, it is all about reaching out to the potential and existing customers in real time.

There are two thumb rules:

1. Start firefighting in the same medium where the crisis has erupted. If the crisis has erupted on Twitter, the brand can't afford to target print media journalists or editors.

2. Keep a close eye on the noise in digital media. This will help a brand custodian to sense a brewing concern and address the issue before it snowballs into a crisis.

Little did Akash know or realise the harm he has done to a world class automobile brand like BMW. But his peers, friends, will be quick in spreading the word far and wide in the buyer community that "BMW is too small". Such crisis needs focused campaigns in target areas. One thought can be on how "spacious" and "comfortable" BMW is beside the riding pleasure and the luxury quotient. Just to override the "too small" notion.

So, in this global village, an "arrogant" youth in Yaminanagar can give sleepless nights to an auto giant headquartered in Munich.

The writer is a luxury commentator and author of 'The Luxe Trilogy'