Archives for posts with tag: luxury


Most companies fail because they treat headaches. Not broken limbs.

I have more than 100 apps on my iPhone. I use 10 of them regularly because they solve an important problem for me. All the other apps are nice to have and relevant but their solution lacks true urgency.

The majority of companies/brands that didn’t make it through the Great Recession or continue to struggle are companies that treat headaches. Nice to have a pill or massage to battle the head pounding. But not life-threatening. You’ll make it through another day with a headache, hard to imagine when it comes to broken limbs.

When the Great Recession started, businesses that treated minor head pressures disappeared overnight: the 100th clothing store, the 51st coffeeshop, the 11th video store. Over the next years, businesses went belly up when they treated minor headaches. In early 2012, businesses are starting to disappear that treated major headaches.

It’s part of the de-leveraging process our society is going through. We cut the fat, only invest in necessities. At this point in time, people don’t buy products or services. They buy solutions.

Be brutally honest

Are you solving a significant problem? Did you identify and quantify a real problem worth solving? If you answered at least one question with a resounding “Yes”, you will succeed.

If your answer was a whimper, a muttered “I don’t know” or a loud “Yes!” – time to start rethinking your business. We don’t know when things get really better and luxuries are affordable again. We know businesses don’t have the luxury to wait until then.


See this thing? The iPad with the shiny stuff on it?

300 carats of white diamonds. It’s also ornamented with rare black diamonds on the home button and Apple logo on the back.

It goes for $1.2 million.

Yes, that’s $1,200,000.

If I had a say, I would drag the maker, Camael, in front of the International Criminal Tribunal in Den Haag and charge them with obscene display of wealth.

Heck, let them be charged for crimes against humanity.

And all the idiots who bought this product should be deported to Somalia.

Let them eat diamonds.

And explain their purchase to starving kids.

That’s what I would like to do with these people.

Actually, what I would like to do is to work with a client (somebody focused on providing customer value) and combat with them any obscene displays of wealth.

I’m sure that brand would be called “anti-capitalist” or “Socialist” by the CNBC crowd.

Even better.

A value brand doesn’t need these guys.

As a brand, you actually want to be despised by that crowd.

Because Main Street will love you for it.

They are your customers, anyway.

Nothing against luxury.

I love high-end hotels.

Business Class flights.

A nice car.

But nobody needs a 300 carat iPad.


It feels like an expensive middle finger defying the fabric of our society.

That value brand needs to live its values, can’t just market them.

It has to be part of their identity, the reason they’re around in the first place.

It can’t be just a marketing ploy.

It requires an organization who has the courage of its convictions.

An immensely powerful platform for a brand to stand out from the value clutter.

Making a positive difference for society and its bottom line.

Who has the courage?


Gas prices are hovering around $4.

You would think people would drive less.

Or be on the hunt for a cheaper gas station.

Actually, the majority of people just resigned themselves to the cost.

Sure, there’s bitching.

But, we still drive 5 miles faster than we should.

I’m in the market for running shoes.

I have a price rang. Nothing over $150.

I could wait another month or so.

As an avid runner, the health of my feet is very important to me.

I pay $80 more if I get value (comfort, less injuries, etc.) in return.

There are cheaper toothpastes than Colgate Total. But I would never buy another brand.

Same goes for Nutella.

When it comes to bigger purchases, I might have spent a minute or two thinking about it.

When it comes to small purchases, no conscious decision was made.

Everything was automatic, pre-programmed.

I had enough good experiences with Nutella, reinforcing the brand promise, making the decision about whether to buy it next time more certain over the years.

Increasing the likelihood to recommend it to someone else. (Buy Nutella.)

Nutella has to continue to provide value.

Or I will look somewhere else.

The majority of purchases are not about price. It is about value.

Value is defined by the desire that a brand elicits.

If the price barrier is lower than the desire, the actual transaction is the value.

Times are tough. But brands that focus on price are communicating they don’t have any inherent value.

There are some gaps that having a large, positive gap between desire and price. Apple, Sony and Mercedes-Benz are representatives for highly desirable brands in the premium space; Huggies, Alpo and Target good example for great value.

And then there are the brands that balance desire and price very well and profit handily: Southwest Airlines and Corona come to mind.

Being considered valuable in the eyes of your customers, transforms your brand into a successful and profitable enterprise.

No wonder nobody cares that much about the price of gas.

$4 per gallon just reinforces the value proposition.

And that’s why you’re not wasting your time trying to find the cheapest gas.