Theorist and founder of Brand Architecture and Brand Stretching, Philippe Mihailovich is an expert in luxury brand management. As an experienced professional, he regularly lectures IFA Paris students (mainly for the Bachelor and MBA programs) and co-leads some of the industry projects within our fashion school. The Fusalp repositioning project for students in the 2nd year of the Bachelor in Fashion Design & Technology and Bachelor in Fashion Marketing was a great opportunity to get to know him better.
IFA Paris: Philippe, for more than 25 years, you have been THE specialist of luxury branding and you are the head of the consulting firm HAUTeLUXE. What does your job consist of?
Philippe: I certainly would never claim to be THE specialist of luxury branding but can claim to have been one of the first to research and create theoretical models that can be used across the industry instead of only one category such as haute couture. My speciality is primarily brand structuring and restructuring - an area nowadays termed ‘brand architecture’.
Brand architects analyse and modify, if and when necessary, brand foundations and DNA, brand philosophies, universe and vision for the long term. We examine brand principles, brand identity « story-building, story-telling and story-doing » , brand image, reason why clients love and respect brands or prefer their competitors and so on. Based on our findings, we develop strategic proposals for luxury houses or even talented individuals in start-up mode.
What is wonderful about teaching at IFA Paris is that our students are taught this process and are expected to produce strategically creative solutions to the complex but real challenges that they are given. They will never be able to find answers online because they are given real-world, real-brand issues where brand owners are themselves searching for unique solutions. It’s wonderful for the branded houses themselves because not only do they save a fortune by avoiding the big brand agencies, they are also more likely to get fresh, cross-cultural directions to consider. For the students it is truly wonderful to gain such experience and even more rewarding if the company chooses to run with their reccommendations, plus they can add it to their resumes!
IFA Paris: Who are your clients?
Philippe: Nowadays I’m working with two high jewellery houses, one shopping mall, and a big Chinese corporation looking to invest in or acquire more French or Italian luxury houses. Tomorrow I could be working on a project for a small alternative leather goods brand or a new hotel. I’m also planning to return to creating my own brands for licensing purposes as I used to do in London and New York. I’m missing those lovely royalty payments. Funnily enough, one of the concepts is something I created just for teaching purposes and have been using that project for years but as no-one has ever done it, not even an ex-student, I’ve decided to do it for real.
IFA Paris: These last few years, what have been the most significant evolutions in luxury brands strategies?
Philippe: We are seeing all luxury houses transforming to omni-channel marketing; more sustainable luxury brands are being created in developing economies; Italians are acquiring more French brands (such as Lancel and Roger Vivier) to have more success in Asia, Koreans and Chinese continue to acquire French houses too whilst also agressively creating their own ‘accessible luxury’ or high luxury brands to succeed in Paris.
High end concept stores and their designers continue to sign up with FarFetch and now that Harvey Nichols are also signed up, we can imagine a few French department stores following. Chanel buying into FarFetch is also interesting as it is more for reasons other than e-commerce. Wechat and Alipay have been successfully establishing themselves beyond the Chinese borders and the Belt and Road initiative is bound to be a game-changer.
Beyond that, brand content strategies (for sharing not selling) are becoming more sophisticated, ‘influencers’ are becoming journalists or in-house PR people, and customers are becoming more connoisseur by the minute. Many know far more about luxury houses that the people who work for those houses. Everthing is changing faster and faster and Millenials finally seem to be trading up and away from ‘street’ so popular luxury brands are having to be very active at all levels from mass luxury to high luxury. What I’m finding strange is that Millenials are saying that brands need to move away from leather goods towards vegan everything, but they are not becoming vegans themselves. They are wanting brands to create everything including haute couture that is genderless but will avoid boycotting Palace hotels owned by the Sultan of Brunei. Luxury houses are having to adapt to these conflicting statements.
In high jewellery many ‘maisons’, such as Cartier and Boucheron, have completely revamped their houses just as Palace hotels have been doing, in order to remain relevant. These jewellers have literally brought back the ‘maison’ concept by restoring and reopening private apartments within their buildings for clients to rent out for the night as was done 100 years ago. The Ritz Hotel remains on standby to deliver ‘haute hamburgers’ and Champagne which they can deliver with a simple stride across the Place Vendôme. No doubt, every ‘freeloading’ social media ‘influencer’ is lining up to enjoy this ‘immersive experience’.
IFA Paris: Through your recommendations and publications on the HAUTeLUXE website, you strongly contribute to this transformation process and particularly stress on the importance of storytelling in the Luxury industry. How do you explain that emotional marketing became an ineluctable development lever?
Philippe: In fact we haven’t updated the website in years because it’s not how we gain clients but when the company was created, many believed that branding was simply about storytelling and of course it is much more complex than that. I’m delighted to see how fast the luxury industry has developed in this way and since Alessandro Michele rejuvenated Gucci, every luxury CEO is now interested in creating a complete brand universe. Kering now speaks of their ‘houses and universes’ and that’s a great sign. Houses that have not developed their own brand universes are quickly learning to do so. Luxury has always been primarily about emotional experiences and the houses that have not taken the trouble to develop their universes are simply finding themselves having to offer ‘experiences’ that others have offered before them. In the digital age, such copy-catting simply accelarates disrespect for a luxury house.
The luxury industry has become so much more competitive and the challenge to surprise and to generate word-of-mouth publicity across borders is getting harder by the day. We have come a long way from simple product marketing and brands being simply names and logos.
IFA Paris: La recherche de connexions émotionnelles supplante-t-elle les grands principes du marketing traditionnel ? Est-ce un concept à part entière ou une branche complémentaire?
Philippe: Does the search for emotional connections supersede the great traditional marketing principles? Is it a concept in itself or an additional branch?
High-end purchases have always been mostly emotional purchases as is the case with contemporary art. However nowadays the emotion of seeing or acquiring a beautiful creation is not enough. I often speak of the 5Es – Experience, Exclusivity, Ethics, and Engagement to enhance Emotions – as a compliment to the Marketing P’s but in reality, in Luxury, Marketing is seen as a vulgar world and much of the principles practiced are the exact opposite of the 4Ps that we tend to learn about in the mass market. Even the word ‘brand’ is not really used unless it is referring to industrially-produced goods. In French there is a clear distinction between the words ‘marque’ for industrial goods and ‘griffe’ for luxury creations (note that I avoid using the word ‘product’).
IFA Paris: The weight of traditions persists in the luxury industry. Does this modify the fusion of senses and emotions approach?
Philippe: Yes to a large extent due to digital channels but high luxury always needs to be noble and can never become as casual-friendly as a Starbucks. Certain traditions are expected even in the simple sense that the luxury brand should set the standards and not the client. The luxury brand must bring in its own culture and must never be desperate to sell. I think the real issue is that what we are calling a ‘luxury brand’ in general is a hybrid model of luxury combined mass marketing and this leads to a lot of confusion. Nowadays its hard to tell the difference between mass luxury brands - that once were true luxury brands- and an Apple store. Often the mass brands are engaging customers far more emotionally than the luxury brand - Red Bull for example. Luxury brands need to find their own unique way of bringing in sensorial experiences and some do this via exhibitions in museums rather than in-store or online only.
IFA Paris: What are the three ingredients for an impacting storytelling?
Philippe: There are more than three, but three key ones are surprise, authenticity and meaningfulness.
IFA Paris: The baseline of your logo says « Tomorrow’s Luxury Brand Strategies ». What would be, according to you, tomorrow’s luxury marketer’s core business?
Philippe: As an idealist, I would say ‘soul’ or ‘soulfulness’ would have to be at the core of the brand but in reality as a job, luxury brand marketing will be about developing and managing seamless omnichannel strategies to attract customers to a physical destination. The more the brand aims to attract a large public, the more Big Data will play a fundamental role. For the high luxury artists or houses however, activities will remain very human through very personal connections. In some cases, the more the artist or house remains secretive and hard to reach, the more they will be in demand. Museum Exhibitions, winning industry awards and celebrity clients - real clients who purchase goods – will always be superior. We see more examples of this in haute joaillerie and haute horlogerie such as JAR, Wallace Chan or Thomas Prescher.