By John G. Fornaro
We don’t have to look very far to see and find luxury brands…brands that stand the test of time, that retain their value and while not totally immune to the vagaries of the world economies, continue to be ‘wanted’ and remain successful.
They are brands that command loyalty…a very desirable attribute.
So what is luxury lifestyle branding, why is it created, what are the benefits and what does it mean for private clubs today.
Jean-Noel Kapferer in his book, The Luxury Strategy: Break the Rule of Marketing to Build Luxury Brands, says, “Luxury is a concept as old as humanity. Luxury is different, and a global way of understanding a customer and managing a business.”
Luxury was invented in Europe eons ago and developed worldwide by French and Italian companies, which have become great global brands, for example, companies we know reasonably well…Ferrari, Louis Vuitton, Cartier, Gucci, Prada…
Luxury is quoted as often being visible because of the logos and brands, but luxury really never compares itself with others. In fact the brands are quite different and generally a rarity. However, increasing demand can encroach on this rarity raising an interesting issue.
Exclusivity also defines luxury, and people want exclusivity. So how does this requirement square with the increasing demand? Exclusivity, Kapferer says means limiting the brand…a distinguishing factor between the luxury product and ‘mass’ products.
In reality we can actually look at luxury as a culture, which in the private club industry means the ‘club’ culture…with its own peculiarities, dynamics and exclusivity.
Fact is, it’s likely many private clubs just don’t know about luxury lifestyle branding…yes, a private club might be branding – with a name perhaps of a benefactor or other amenity, but it’s not luxury lifestyle branding.
So how do private clubs build a luxury lifestyle brand?
“A club’s brand is significant because it shapes how the marketplace views the club,” explained Frank Gore of Gore Golf, and chief analyst of BoardRoom’s Distinguished Clubs program.
“It can have an effect on the joining fee, retention and the club’s ability to attract new members. It is more than the traditional branding of the club’s name, logo and tag lines. It includes the clubs history, image and what makes it special.
“Clubs are a luxury and are selling an intangible luxury lifestyle to the market’s most affluent consumers and therefore should position the club accordingly,” Gore added.
“Effective branding should invoke emotion,” exclaimed George Stavros, principal with Pace Setter Technology, a firm that works at improving operations and branding experiences for private clubs.
“Emotion is one of the four Es including experience, exclusivity and engagement.
Simply put, effective branding builds loyalty. It creates a buzz. Members talk about how wonderful it is at the club and that builds desire, which leads to exclusivity,” Stavros added.
“Brand is everything,” injected ClubMark’s CEO Rick Coyne. “Luxury brands exude total quality, inclusive to a culturally diverse consumer and generally with costs relative to the experience.
“Clubs serve two markets – their existing members and those that are not yet members. Everything that a club does internally for its existing members is projecting to potential members what they can expect.”
Coyne feels it’s vitally important to know your market before branding your club.
“You shouldn’t plan a brand until you fully understand your market. Club communities that brand in a luxury lifestyle are generally positioning similar to a high-end resort. Clubs too can likewise position, but if your market cannot afford a luxury brand it would be foolish to try.
“The only way a club should position itself with a luxury brand is if the market supports the position,” he explained.
“Clubs like any luxury brand have customers, or in a club’s case members who have a choice,” intoned Tom Neill, president of Private Club Historical. His Laguna Beach, CA firm curates, discovers and designs historical displays, exhibits, videos and photography, highlighting a private club’s unique history.
“What’s unique and extraordinary is the connection between the club and its members. No other luxury brand has a relationship like this. So it’s imperative the behavior parallels the fact that it’s the members who own the brand and by respecting them, listening to them, you earn their trust.
“Through my experience,” Neill added, “I clearly see two entities of branding: external and internal.
“External as represented by tangible items such as logo marks and websites, but more importantly for a club, is internal emotional branding as represented by a member’s pride in their club. For example, this can be accomplished by historical displays and exhibits featuring past and current members and is important for creating a cohesive positive member experience,” Neill suggested.
“It’s important because each club has its own unique brand, its own history, its own character, its own thing that it should be known for,” stressed Keith Jarrett, president of BoardRoom’s Distinguished Club program. “And the most successful clubs highlight their brand throughout the walls and displays of their clubhouses.”
There’s a general consensus benefits accrue with a luxury lifestyle brand.
“The club will attract the communities most influential and important people. The city’s major events will be held at the club. Major decisions affecting commerce, politics and social issues will be made at the club,” Gore suggested.
“Once the club is associated with a luxury brand the club’s image is enhanced, important people will consider membership in the club and the club can attract top talent for department heads and other important staff positions,” he added.
“The benefits are numerous, especially the benefit of a member belonging,” Neill stressed. “It’s the belonging to a brand that creates the greatest impact upon the member. It’s the unique sense of accomplishment and achievement and that they have arrived at their goal.
“By belonging, this brand emotion manifests itself when justifying initiation fees, dues and assessments,” he expressed.
Coyne however, cautioned, “Unless the market is capable of affording a luxury brand, there is no benefit to your club trying to supply something the market cannot afford. If the market can sustain a luxury brand, you will stand out in the marketplace.”
And if “the market can afford a luxury lifestyle brand, the benefits are attractiveness to a discerning market capable of affording the fees endemic to the experience,” Coyne explained.
What about younger generations? Will luxury branding make any difference for these younger, potential members thinking about private club memberships?
The sheer number of younger people and their interest in brand name products does make that likely. For example, Pace Setter Technology suggests there are 12 million Millenials considering taking up the game of golf.
So what’s the private club industry doing to attract them and are Millenials more influenced by branding and the product names.
“Indirectly,” suggested Pace Setter’s Stavros. “They are more influenced by relevant consumer feedback. Millennials are far more likely to get a recommendation or confirm through online reviews. When branding is effective, it creates a buzz. It’s about the four Es – emotion, experience, exclusivity and engagement,” he injected.
Does having a strong brand attract new members and staff? “Absolutely.”
Does having a strong brand attract referrals? “Absolutely.” Does having a strong brand increase the value of an initiation fee or justify the dues? “Absolutely,” Stavros maintained.
“The younger generation has always enjoyed associating with the most admired trends, products, and brands,” Neill commented. “It’s how they feel about a company, it’s rational but mostly emotional.
“Social media has also expanded the brand’s communication through multiple channels. Many of these channels can track where you came from and are going, and use incredible algorithm to communicate and hone a brand to the user.
“Younger generations, or future members are exposed to this like never before,” Neill added. “The logo, the graphic elements are simply a visual and emotional cue, which I call an ‘intertangible’, the moment the visual transitions to the sublime and the emotional branding takes over.
“A club’s strong brand, a high-end, luxurious look will attract new members and win the hearts and minds of those who are seeking to join their first club. By offering them a luxurious experience, this will appeal to those who are now in the market for an added benefit to their lifestyle.
“However, a major part of a club’s brand is its history and for many, we see clubhouses, which look like a hotel chain lobby. There is nothing on the walls or any exhibits, which depict the club’s historical significance and more importantly, the member.
“Clubs that do have this historical presence use their displays as their premier tool when touring prospective members,” Neill stressed.
And does a strong brand attract both new members and staff?
“This has been validated many times. The brand specifically may not attract new members, but when a member is proud of their club, they refer friends and business associates to membership. A strong luxury brand creates pride in belonging the basis for referral,” expressed Frank Gore.
“A historical display depicting a club’s history can embolden a strong internal emotional brand identity,” Neill explained. “This in turn, sparks pride with members and a sense of belonging and this is relayed to referrals. Imagine having 500 member tour guides!
“Yes, a strong luxury brand increases member usage and pride. Member pride can solve a lot of a club’s challenges by justifying initiation fees, dues and assessments,” Neill concluded.
Publisher’s final thoughts
The next generation of members, the Millennials, are branding fanatics. They buy Apple products, wear Nike and drive BMWs. This generation has been raised on branding, and I believe to reach this next generation of private club members your club must stand out.
Your club needs to have a strong brand. And not just a strong brand, because by the time Millenials can afford to join your club your club needs to be a luxury brand. There are myriad reasons why.
For years, my wife has been buying Louis Vuitton purses. I’ve always wondered why, because 90 percent of each of these purses is made of canvas, not even leather. Yes, there must be some appeal, yet they all look the same. Louis Vuitton is written all over each purse and is very expensive. So what’s the appeal?
She buys Louis Vuitton, I believe, because it makes her feel good. She feels she has arrived. And that’s no different than your members when they join your club. They feel like they have arrived. They enter your club with a feeling of pride and accomplishment.
When you walk into a Louis Vuitton store, there’s a feeling of luxury, exclusivity…the stores look classy, staff is very well trained and professional. The walls covered by photos of 100-year-old luggage…pictures of Louis Vuitton suitcases on old cruise ships, in antiques cars, and the like, giving an air of longevity and exclusivity.
When you are in their store you feel as though you are in a special space…with the products that ooze history and distinction.
I mention the Louis Vuitton store as an example because the key aspect to branding and treating your club as a luxury brand is that people feel they are in a special space when they walk into your club. It’s the way they want to be seen and treated.
Many clubs today look like a Marriott hotel lobby, and when walking in the front door that’s the feeling one gets…not that there’s anything necessary wrong with a Marriott hotel, but it’s certainly not a luxury private club.
I’ve actually seen the same pictures on the walls at three different country clubs…all with similar interior designers. Or they have pictures of flowers and maybe even pictures of some other golf course, not that there’s anything necessarily wrong with flower and golf course pictures, but…
Cover your walls with history, picture and artifacts from the past, from previous members, events and guests. Show your members your club is proud of its history, because you want prospective members to feel and know they are in a special place.
Remember, clubs are selling more than the functional product (for example, a clubhouse, tennis courts and a golf course) itself. There is something else, and it’s symbolic. Clearly it’s the identity, the intangibles, which the club confers upon each and every member.
Some members might see their membership as being of superiority. I believe it’s common for luxury brand customers to sense that link to something special. It may be a link to a story, a founder, or a creator or a specific time. But, it’s something special.
I also believe many buy luxury products because of authenticity. Today, more than ever, people feel dislocated from any sense of authenticity. Walking into and around your club you must feel the purity of belonging to ‘this’ club, which sends a message saying, ‘this is something you can be part of’, to which you say, “This is something I can and want to be part of.”
Over the last three years, we have visited hundreds of clubs and a common message we have received from club staff and management is this: We are the home away from home for the members. We are there second home and so on.
But it’s also interesting in that many of the clubs we visited don’t look like a home…they look and feel like hotel lobbies.
When you walk into one of your members’ homes, you see history. You see photos of their trips, their family, present and past, and mementos from the past. You can tell a lot about a member by walking into their home.
Shouldn’t the club really look like a home away from home? The only difference is that your club members are the family, the history is the club’s history and the mementos are from the club’s past.
Branding your club like a luxury brand will help you in many ways. Membership recruitment, retention, and the feeling of community it provides.
How do you currently defend the price of your initiation fee? The board sets the price or the member sets the price, based on what? A luxury brand.
Treating your club like a luxury brand will make it easier for you to defend the price, which of course, increases not only the value of the club, but also the value of the club to your members.
At least that’s the way I see it!
John G. Fornaro, publisher
If you have comments on this article or suggestions for other topics, please contact John Fornaro at (949) 376-8889 or via email: email@example.com