Shifting focus from the Middle Class to the 'New Rich': In Japan, luxury brands are shifting focus from the middle class to the 'new rich' segment. This segment consists of individuals with assets worth US $ 852,100 and engaged in sectors such as IT, Finance and Medical Services.

a. Armani, Bvlgari and Gucci opened flagship stores along with restaurants and spas in Tokyo, with the aim of attracting the wealthy from all over Asia.
b. Louis Vuitton sends birthday cakes to its wealthy clients and shows them an exclusive bag.

Stores in Smaller Cities to Target the Growing Affluent Classes:
a. Louis Vuitton and Gucci have opened stores in smaller Japanese cities, where individuals are still lured by the logo.
b. Cartier shifted focus from Tier I cities (Beijing, Shanghai) to Tier 2 (Nanjing, Tianjin) cities in China.

Launching Less Expensive Collections:
a. Polo Ralph Lauren announced plans of launching a lower price product range in US.

Personalization & Customer Service

What should now be "in" for marketing luxury in this difficult era is pampering the wealthiest and most loyal customers with everything from monogrammed shirts to personal in-home visits.

Steve Madden's DIY Shoes: Consumers can visit their site and design their own shoes at a 25-30% higher mark-up.

Luxury brand Valentino's offers a special luxury service called Valentino 'BY APPOINTMENT', where it offers VIP clients the indulgence to experience luxury shopping in the privacy of their homes.

The Ritz-Carlton Hotels' legendary service starts with 100 hours of training in order to treat every guest like royalty and being devoted in making sure that every stay is a memorable one.

The Product Front

Line Stretching

Down Market Stretching: This is already being followed effectively by Armani and GAP in their offerings. Armani has classified its products as Giorgio Armani, Emporio Armani and Armani Exchange, while GAP introduced a cheaper variation in the form of Old Navy.

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* Contributed by: -
Aniruddh Kr. Singh,
Batch of 2007-09,
Faculty of Management Studies, Delhi.
Article posted on December 21, 2008.