What makes a premium brand premium ?
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I was thinking the other day about the DNA of premium brands.
One thing is certain -- it's a relative idea. For example, Hyatt is not a premium brand if you're used to staying at a W or a Ritz Carlton. But if your vacations to date have been holed up in a Holiday Inn, then by all means a stay in a Hyatt is a premium experience.
Another thing is certain -- a brand is considered premium only when we believe it is worth the price. And that's where we can dig deeper. Why are we willing to pay more for a product when there are others that provide the same service or function at a lesser price?
I believe it is because a premium brand is built upon specific tangible and intangible attributes that give it a sense worth:
• Sensuality -- it is sensory, tactile and a bit mysterious.
• Rarity -- it represents a discerning choice, intriguing because it is uncommon.
• Confidence -- it projects a feeling of intrinsic worth.
• Authenticity -- is has a sense of "true north" and remains true to this ideal.
• Quality -- it is consistent and shows extreme attention to detail.
Think Tiffany, Apple, BMW, L'Oreal, Viking and Range Rover.
Conversely, think about premium brands that became confused by launching questionable line extensions or branding strategies, or became too common by embracing mass marketing strategies in pursuit of volume: Starbucks, Absolut and Jaguar.
Managing a premium brand is one of the most difficult challenges in marketing. Like all business, they must pursue growth strategies. However, unlike many mainstream businesses, premium brands must do so in a way that doesn't dilute the brand's image or the user's sense exclusivity and pride. Certain strategies are off-limits. Brand managers for premium brands must know when it is best to pass on short-term growth opportunities that could tarnish the brand's long-term health.
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