Hot Topics: How are you growing and widening the appeal of a luxury brand without compromising its exclusivity?
Simon Sproule: In terms of growing and widening the appeal of Aston Martin as a luxury brand, we are doing this organically through renewal and extension of our product line. The second part of it is geographically with expansion into new markets and creating new segments within existing markets.
We grow organically and carefully and we won’t grow beyond a certain point. One example of this is very simply that we intend to cap our production of sports cars at 7,500 a year and not produce beyond a certain limit.
With this growth, the key to not compromising the exclusivity of Aston Martin as a luxury brand is associated with maintaining the price points of the brand. This ensures we retain our position.
HT: How has the definition of luxury changed over time?
SS: There has been a massive expansion in the luxury market in general. The market has grown in hotels, travel, food – in just about every category you can think of there are luxury players being created or that have been expanded to meet the demand.
To be recognised as a true luxury brand has, deservedly, got tougher. Otherwise the term luxury becomes devalued. The other change is that luxury is no longer about the product alone it is about the experience and relationship with the brand. You may buy the half million pound watch, or Birkin handbag, but the product is not enough. The consumer wants to have the story; they want the direct relationship with the company, they want to have the CEO’s private line.
Hence what I’ll be talking about at the Festival of Marketing is ultra-personalisation in the luxury space. And we can do that because we are not dealing with millions of people – we are able to have that direct dialogue, creating products and services they want.
HT: Why is personalisation now such an important concept?
SS: I think people want what other people don’t have. In the very simplest terms, if you have the wealth to buy a beautiful object, then you perhaps want that object to be one of one. People want luxury brands to personalise to their exact specifications, or provide a level of service completely unique to them.
The luxury market is there to serve a demand that is increasingly bespoke and the whole point is that luxury is a not mass market, which is the danger for luxury – a luxury brand becomes devalued if it becomes mass. If you are in luxury market you need to be able to deliver for your customers and your customer wants. It’s very much an engaged process.
HT: How is the luxury industry adapting to improve the customer experience?
SS: In my view, it’s invisible technology – for example, sophisticated CRM systems that have very advanced ways of managing your relationships with your customers. People aren’t going to ‘one click’ buy an Aston Martin; they don’t want that from us. They want to see your luxury brand: the car, choose the leather, and meet the craftsman; they might want a different colour on the interior. That is part of the joy of ownership, and that’s what we should be celebrating.
HT: And does that translate into meaningful engagements?
SS: It has to.
HT: What elements of technology is the luxury industry adopting to innovate its services?
SS: It’s using the latest CRM technology – for example, Aston Martin is just rolling out its new CRM. You can’t have a global customer handling programme using paper and spreadsheets. It needs to be sophisticated and 24/7.
It makes absolute sense for luxury brands to embrace as much technology as we can, but the caveat of this is the customer is still engaged with us on a personal level – a phone call, a meeting, a visit to the factory to meet the craftsman, an opportunity to come and spend time with the brand. The idea is that we are tech driven, but personally delivered.
I have met more customers in the last year working for Aston Martin that I have in more than 25 years of my career. It’s a very personal relationship where I have customers email me, call me. We spend time with them and go to events with them. They love the brand; we have a lot in common.
HT: Aston Martin straddles 2 industries, luxury and automobile, what are the challenges of delivering in both markets?
SS: The challenges with an automotive product are associated with quality, design, engineering, technology – it is arguably the most competitive industry there is because it has more brands than any other industry. On average in every car market around the world you find 15 to 20 brands. It’s also an industry driven by emerging tech and innovation so that’s something we deal with every day.
In the luxury space, it’s more nuanced – here you’re not necessarily always competing against another car company. You are part of the lifestyle for a customer that has relationships with multiple luxury brands – they might be a Rolex collector or collect Birkin bags from Hermes, have a boat, or two boats, or three houses. In the luxury space, our challenge is to be complementary and add richness of value to their lifestyle.
HT: What trends in both industries are you expecting to manifest in 2016?
SS: I don’t think we are anticipating ground-breaking trends – nothing dramatically new. For us, we are on a journey of authenticity. I think the definition of a luxury brand is becoming acutely more important and we are on a constant journey to ensure we deliver what consumers expect.
I think the other part of this is continuing a journey delivering experiences and relationships that money can and money can’t buy – those are the types of experiences and relationships that we offer. As people look to have a relationship with a brand beyond the product, those experiences and relationships become more important and a business opportunity for luxury brands.
Simon Sproule is presenting ‘Why every brand needs personalisation: lessons from a luxury car brand’ at the 2015 Centaur Festival of Marketing, 11-12 November.