A cheaper brand

Think of cosmetic or personal care product that you could do without during the GFC and decreased income. Did you discontinue using products, or did you switch to a cheaper brand? Explain why or why not. Shiseido is always my first choice among facial care products even though GFC or income decreased. There are several reasons to continue using Shiseido without switching to a cheaper brand. Firstly, a used brand reduces functional risk, physical risk, financial risk, social risk, psychological risk and time risk.

Secondly, it has a number of unique advantages (POD): long history (since 1940s) (Shiseido, 2012); good reputation in Asia market; leadership in Asian cosmetic market (Roll, 2012); meet Asian’s needs better than most western brands. In general, Shiseido is more like a ‘masstige’ brand than a luxury brand, and it strike a balance between the premium quality and appropriate price. In this case, one strategy for luxury brands to survive from rough financial times is developing ‘masstige’ brand.

Masstige brand, which combined mass and prestige, means offering the original brand at affordable price or launching a new product line under existing brand that can be more acceptable by masses(Baumann& Valentine, p62-63). Since 1990s, with the growing middle class, cheaper or generic brand was not longer satisfied their need while they could not afford luxury brands. They need a brand that has strong brand image, valuable, personalize but more accessible.

There are some examples of masstige brand such as H&M, Marc Jacobs (second line of Louis Vuitton), mini AE140 made by Benz and so on. Besides, developing oversea market, especially Chindia market was an important strategy for luxury brands to get through the GFC. In this case, Chindia regions still grown although slower than their peak (Baumann& Valentine, p60-61). Lastly, there is a conservative brand which is Bulgri, hold its three principle and unhurt by GFC: prudent merger and acquisitions, cautious expansion and tightly authorization.

Although collectivization became luxury industry trend (likes LVMH group owned LV, Dior, Fendi, Guerlain, Givenchy etc. ), Bulguri just Bulguri. In addition, “crossover” also popular in luxury brand such as Vertu corporate with Ferrari, Adidas’ YSL limited edition products. The major emerging markets are China and India. Chivas Brothers, as the world’s second producer of Scotch whisky and industry leader in Premium gin, was one of major player in emerged market (Richard, 2006).

Since 1992, with entering into China, China market has became the No. 1 whisky brand in China and China shared the largest market of Chivas. Chivas was successful in China because it target on the right market and has correct brand positioning. Even Chivas is more likely an aged brand, it was one of several choice in College students' graduation party in China which hard to imagine. In fact, for Chinese market, Chivas target highflyers at first just like what other whisky brands; however, this strategy was fail in China.