Bill's Blog

Appropriate is a loaded word, one that is filled a myriad of implications. Is that appropriate behavior, or appropriate dress? Appropriateness is now front and center in the minds of marketers everywhere. That's what an epic recession brings to brands everywhere today.

The brands best positioned for today's economic tsunami are those that are necessary, relevant, wholesome, and even nurturing and caring. In the brand world, marketers have an emotional recession that is turning all of the accepted brand norms upside down.

It has long been thought that luxury goods were immune from recessionary woes. That isn't the case right now. Conspicuous spending is out of fashion. It is viewed as bad taste and frivolous. If you think that this doesn't affect luxury brands, consider the statistics. The wealthiest 10% of the U.S. populace accounts for 50% of the U.S. retail spending.

The numbers are truly sobering for luxury goods brands. Bain and Company forecasts luxury goods sales to decline by up to 7% this year. It is previously unheard of retraction in this segment. Could it be that luxury is out in today's new world economy? It opens up the notion of marketing appropriateness in a big way.

Casinos are facing this new "appropriate" dynamic. Yes, gaming is viewed by many as being inappropriate, but now it is at a far higher level. Is spending money for gaming truly appropriate behavior in this economic climate? Shows and dining are still strong in the casino world, but the casino gaming drop is way off. Entertainment brands are appropriate, while the gaming side is not. A true marketing dilemma.

Luxury brands are trying to stay relevant and nurturing by offering customers bag choices for their purchases. Hermès and Tiffany are brands synonymous with their shopping bags. The Hermès orange and the Tiffany blue bags were badges of honor among the well to do! The bags spoke volumes about who people thought they were and they wanted to flaunt that very fact. These brands are now helping people be appropriate by hiding the purchases in nondescript bags. They call it "stealth wealth."

For marketers today, especially in the luxury goods category, it is a very fine line between their brands being considered appropriate or inappropriate. It's a trend well worth watching.