LVMH reduced paper fashion magazine advertising
No one can make history without stopping. This is Rimowa's latest advertising slogan, and it is now one of the world's largest luxury goods group LVMH revolution.
Rimowa recently announced the signing of tennis star Federer as the brand ambassador, and invited Virgil Abloh, supermodel Adwoa Aboah, Dior Homme new jewelry designer Yoon Ahn and world famous chef Nobu Matsuhisa to shoot the first commercial in the 120 years of the brand "No One Builds". a Legacy by Standing Still”.
It is worth noting that for this commercial, the brand announced that it will use the "non-paid print policy" method, except for starting in an unnamed newspaper, not in any paper publication. On the promotion, the advertisements will only be placed on online media, video websites, theaters and other channels. This is the first luxury brand of LVMH to make such bold moves. Whether the other luxury brands under the group are following the industry's extensive attention.
Supermodel Adwoa Aboah participated in the first commercial of Rimowa in 120 years "No One Builds a Legacy by Standing Still"
Nearly radical marketing strategy confirmed that Rimowa, which was acquired by LVMH, is becoming a test field for the group's youth reform.
In October 2016, LVMH announced the acquisition of 80% of Rimowa for 640 million euros, and then accelerated to young consumers under the leadership of the group's chairman Bernard Arnault Alexandre Arnault.
The picture shows the new brand logo of Rimowa
In February of this year, Alexandre Arnault promoted the replacement of the Rimowa brand logo, turning the font into a sans serif font, making it visually fresher and more vibrant. The new logo was officially launched in January this year. Since last year, Rimowa has been innovating with the brand Supreme, Off-White, and the luxury brand Fendi, constantly creating a sense of fashion and creating hot spots to attract the attention of young people.
Since Alexandre Arnault took over Rimowa, the brand has become more and more important to the online market, which is closely related to Alexandre Arnault's own digital marketing background. He played a key role in the launch of the LVMH e-commerce platform 24Sèvres. In June of this year, LVMH also appointed the eldest son Antoine Arnault as the group's propaganda and image leader, responsible for overseeing the promotion of the group's luxury brands on social media.
The picture shows the Rimowa x Off-White limited suitcase
In fact, Rimowa's rejuvenation initiatives are also highly consistent with LVMH's overall strategy. In terms of marketing, LVMH is constantly reducing the advertising of traditional fashion magazines.
According to AMM's annual report, LVMH, which has more than 60 luxury brands, cut its advertising spending last year by $15.2 million to $216.3 million, and magazine advertising revenues of the world's 50 largest advertisers fell from $6.5 billion in 2016. The $6.1 billion means that the magazine industry lost at least $400 million in revenue last year. According to advertising procurement company Magna Global, until 2021, global magazine newspaper advertising spending will shrink by 8% per year.
Also reducing the magazine’s advertising expenses is the Estée Lauder Group, which has reduced its beauty giant by $46.3 million to $95.3 million; Gucci’s parent company, Kaiyun Group, cut $7.5 million to $97.2 million; in 2017, it reported its first earnings report and revenue of 9.62 billion. The dollar's Chanel has cut $7.8 million to $67.4 million; Amazon, the ambitious e-commerce giant in the fashion industry, has cut nearly half of the magazine's advertising budget, cutting $37.6 million to $44.3 million.
The eldest son Antoine Arnault (left), Bernard Arnault (middle), the second son Alexandre Arnault (right)
As the parent company of magazines such as Vogue and Vanity Fair, Condé Nast lost more than $120 million last year and is intensively adjusting and reforming within the group. At present, although the Group's online business has begun to obtain considerable income, it still cannot make up for the loss of paper media. After closing the "Details", "Self" and "Teen Vogue" papers, after 80 job cuts last year, Condé Nast executives said recently that the group would seek to sell "Brides", "Golf Digest" and the recommendations of the Boston Consulting Group. Three magazines of "W". To save costs, Condé Nast will also lease at least 6 of its 26 floors in the World Trade Center office.
The domestic fashion publishing group is also not optimistic, making it harder and harder to make money. The "Huizhou FEMINA" under the Hearst China Group officially ceased publication in January last year. The Bund Pictorial earlier shut down the printing magazine to fully transform new media. Since 2016, including the new vision of Hyundai Communications, Magazines such as Bazaar Art, Ruili Fashion Pioneer and Self Yue have also ceased publication.
According to the fashion headline data, in the first half of this year, the "Weekly Pictorial" parent company Hyundai Communications Group's revenue increased by 13.8% year-on-year to 194 million yuan, but still recorded a net loss of 31.405 million yuan. According to public data, the profitability of modern communication has been declining for many years. In 2014, the profit was 37.79 million yuan. In 2015, the profit was 20.92 million yuan. In 2016, it plummeted to only 3 million yuan. Last year, it recorded a loss of nearly 40 million yuan. (Extended reading: "Weekly Pictorial" parent company lost 31 million in the first half of the year)
Obviously, luxury brands have drastically cut magazine advertising budgets, not to reduce group spending, apparently spending money elsewhere.
The online market is now the most important and promising growth engine for the fashion industry. According to McKinsey's forecast, online sales of luxury brands will reach $81 billion in 2025 and are expected to account for 18% to 20% of total brand revenue. In order to promote the expansion of the online market, the most direct way is naturally not through the use of paper media, but through more online market, more digital influence of fashion bloggers and social media.
Internet platforms such as social media and video sites have also become the new favorite of luxury brands. As the social media ecosystem becomes more diverse, luxury brand retailing tends to be vertical, and the chain of user conversions is constantly being shortened. Social media such as Facebook and Instagram are called more and more frequent advertisements for luxury brands. In China, WeChat, which has 1 billion monthly active users, plays the same role.
As young people become the mainstay of luxury consumption, the logic of luxury advertising becomes where young people are and where advertising targets are.
In the past year, Estée Lauder has been released in the WeChat circle for up to 18 times, of which about one-third is new. According to Tencent's index data, more than 90% of the head beauty brand's online voice comes from social media, and young consumers who grow up with social media are more likely to touch the brand in their familiar scenes. (Extended reading: Where are the ads for luxury brands going?)
In addition, fashion influencers have moved from the edge to the center, given that influence has become a hard currency in the online market. The new darling of these luxury brands has been given a simpler and more direct name for "Opinion Influencers" in the past two years. In the Chinese market, people are used to calling it KOL (Key Opinion Leader) or net red.
According to the British "Financial Times" report, Greg Paull, head of the global marketing consulting firm Shengsan Management Consulting R3, said that China's key opinion leader KOL has taken the lead in other countries around the world and is the first to become a real media carrier. In China, KOL marketing is gradually replacing traditional marketing methods such as TV and print media advertising.
At first, luxury brands only added KOL marketing as a icing on the cake, and nowadays it has become a mainstream trend. In July of this year, Dior conducted a large-scale KOL marketing to promote the latest saddle bags on social media worldwide. According to incomplete statistics, at least 20 KOLs released saddle bag photos on social media on the day of the saddle bag sale on July 19th, which immediately increased the popularity and spread of the handbag under the influence of the scale effect.
Relying on KOL marketing, Dior has also become the big winner of the recent fashion blogger Chiara Ferragni wedding. According to LaunchMetrics data testing, from August 31st to September 3rd, fashion blogger Chiara Ferragni three days after the wedding and wedding day, the topic tag #TheFerragnez on Instagram was awarded $36 million. Media Impact Value (MIV) and triggered 67 million interactions. Among them, the Dior wedding dress and dress she chose generated more than $5.2 million in audience media influence and 5.6 million interactions.
The influence of Chiara Ferragni's personal postings accounts for 31% of Dior's global MIV. 41% of brand-acquired MIVs come from online resources, while 59% come directly from social media platforms. Some analysts said that Chiara Ferragni's exposure to Dior or Dior saved $2,200,000 in digital media ad placement costs. It is worth noting that the media influence of Dior's audience is higher than that of the dress brand Givenchy when the British Princess Meghan Markle was married.
Although the actual ROI of KOL marketing still lacks reliable data support, KOL's influence on brand sales is more easily quantified than traditional magazines. The Chinese fashion blogger KOL list released by the latest report of BNP Paribas this year has increased the WeChat conversion index in addition to the number of Weibo fans. In terms of WeChat conversion rate, Rebecca became the fashion blogger who most influenced the fans to buy products, followed by gogoboi and Mr. Bao.
According to the "2018 China Network Red Economy Development Insight Report" jointly released by Ai Rui and Weibo, as of May 2018, the total number of domestic fashion KOL fans reached 588 million, a year-on-year increase of 25%, including 53.9% of the fan age. Focus on under 25 years of age. At present, 61% of users on Weibo are also concentrated in this age group, becoming the main crowd of fashion bloggers.
The report also found that 95% of fashion bloggers have received higher education, and 14.6% of fashion bloggers have master's degrees or above. The improvement of the comprehensive quality of fashion bloggers has promoted the continuous improvement of content quality. According to Mediakix, a fashion blogger's marketing ability consulting organization, the annual global fashion blogger marketing volume has reached 1 billion US dollars.
Monocle founder Tyler Brûlé once said that the boundaries of the Internet have been very vague, and many people say that this is not important, because GeekBuying Coupons magazines need to survive anyway, but if you start to lose the trust of the core readers, your position will be insured.
Now, the tradition of the fashion industry has been broken, and strengthening digital marketing has become a business strategy for the brand. For luxury brands, social media that pays more attention to user thinking is increasingly about consumers' choices.
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