Paul Husband - The Cult of the Luxury Brand: Inside Asias Love Affair with Luxury

Praise for

THE CULT OF THE LUXURY BRAND

In this superb book, through a series of case studies and insightful analyses, Chadha and Husband highlight new marketing tools that companies are successfully implementing to create and build the luxury cult. This is a must-read book for executives who want to build their luxury brands in the booming Asian markets.

Sunil Gupta, Professor of Marketing, Harvard Business School

Fascinating. Full of insight and vital source material for anyone interested in understanding modern Asians.

Miles Young, Chairman of Ogilvy & Mather Asia Pacific

Painstakingly researched and easy to read, an amazing look inside the luxury brand trade.

Ambar Brahmachary, President of JWT Japan

Excellent and timely. Chadha and Husband have got the story. Its hands-on, accessible, informative, professional and lively.

Dr Kaori OConnor, University College London and author of The Way We Wear

There is no other place in the world where luxury is the currency of power than Asia, where what you wear speaks volumes about who you are. Fascinating and informative, The Cult of the Luxury Brand is a must-read for anyone who is looking to enter the retail development market in Asia, an invaluable tool in understanding the psychology of the Asian consumer.

Bertrand Pellegrin, Marketing Director of Lane Crawford

Well researched and highly readable, this book goes well beyond merely documenting the luxe phenomenon in Asia. It explains how cultural concepts such as guanxi, conformity and kiasu are given their spiritual edge today through the way luxury brands are used as personal props. It is a fascinating read, and adds texture and flavour to understanding how the Asian century is taking shape.

Mark Blair, author of 360 Brand in Asia and President International Clients, Ogilvy & Mather Asia Pacific

The authors have delved into the psyche and the motivations of the most fascinating consumers in the world. This book is an invaluable tool for investors and managers to understand the path ahead for luxury in Asia.

Sagra Maceira de Rosen, Managing Director of Reig Capital Luxury & Retail, former Head of Luxury Goods Equity Research, JP Morgan

A fascinating journey behind the luxury phenomenon that is shaping mass consumption in Asia. Filled with actionable insight for all marketers. Read it for pleasure and profit!

Richard Lee, Vice President, Marketing, PepsiCo China

INSIDE ASIAS LOVE AFFAIR WITH LUXURY

Radha Chadha & Paul Husband

To the best home team an author can hope for: My husband, Sanjeev, who commented on every draft; my son, Kabir, who pulled those pesky endnotes together; my daughter, Noor, who visualized diagrams and double-checked facts. This book is as much yours as mine.
Radha

To my wife Nancy whose interest and passion for the worlds best brands made this such an enjoyable journey.
Paul

First published by
Nicholas Brealey International in 2006

www.nicholasbrealey.com
www.cultoftheluxurybrand.com

Radha Chadha and Paul Husband 2006
The rights of Radha Chadha and Paul Husband to be identified as the authors of this work have been asserted in accordance with the Copyright, Designs and Patents Act 1988.

eISBN: 978-1-47364-501-1

British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library.

Library of Congress Cataloging-in-Publication Data

Chadha, Radha.

The cult of the luxury brand : inside Asias love affair with luxury / Radha Chadha & Paul Husband.

p. cm.

Includes index.

ISBN-13: 978-1-47364-501-1

ISBN-10: 1-904838-05-7

1. Brand name products--Social aspects--Asia. 2. Luxuries--Social aspects. 3. Brand name products--Asia--Marketing. 4. Social status--Asia. 5. Social classes--Asia. I. Husband, Paul. II. Title. III. Title: Inside Asias love affair with luxury.

HD69.B7C467 2006

306.34--dc22

2006015486

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording and/or otherwise without the prior written permission of the publishers. This book may not be lent, resold, hired out or otherwise disposed of by way of trade in any form, binding or cover other than that in which it is published, without the prior consent of the publishers.

Printed in Finland by WS Bookwell.

Luxury bag in hand, Asias on the move!

Photos courtesy of Estel Aymard and Jeff Laitila ( www.sushicam.com ).

You never really understand a person until you consider things from his point of view until you climb into his skin and walk around in it.

Harper Lee, To Kill a Mocking Bird

Youd think it was a rock concert, not a store opening, the way thousands queue up days in advance to get a toe in on Day One at yet another mega-sized luxury brand store. When theyve left, the store has been stripped clean, as if by locusts, with hardly a handbag, wallet, or key ring left on the shelves. Herms in Ginza, Louis Vuitton in Omotesando, Coach in Shibuya, Prada in Aoyama just put up a megastore in Tokyo and the queues start forming. Japan may have been in onoff recession for a decade, but Japanese consumers like others in Asia carry on their obsessive love affair with luxe. A staggering 94 percent of Tokyo women in their 20s own a Louis Vuitton piece. (Some own dozens, but thats another story.) Other brands dont do too badly either 92 percent own Gucci, 57 percent own Prada, 51 percent own Chanel, and so the list goes on. Welcome to luxury brands in twenty-first-century Asia.

This book is about the cult that is sweeping Asia, a phenomenon so powerful that the continent is now the biggest market in the world for Western luxury brands. Its about stepping into the skins of millions of Asians to understand why they are snapping up Louis Vuitton bags and Rolex watches and Armani suits as if their lives depended on it. Its about how a keen understanding of the Asian psyche has helped the luxury industry create this cult, which, needless to say, has proved immensely profitable. Its about invaluable business insights into how to make money and call the shots in a world where most other product categories face thinning margins and increasing retailer dominance.

So far the nerve center of this cult has been Japan, the Japanese peoples passion for luxury brands so huge that they account for over 40 forcing the company to aggressively grow other markets.

Now the rest of Asia is showing the same passion for brands. Hong Kong, South Korea, Taiwan, Singapore, Malaysia, Thailand the cult is fast gathering momentum everywhere. China, just out of Mao suits, has rushed headlong into Zegna, Dunhill, and Burberry, displaying such a strong luxe tooth that Chinese consumers shopping at home and abroad already account for 10 percent of global luxury brand sales, a figure growing rapidly as we speak. Then theres the other billionaire, India, its full-throttle economy creating new money, its people awakening to luxury.