Ethnographic Research Project
1.0 Introduction 简介
1.1 The basic situation in Hong Kong
Hong Kong is a materialistic society and also a consumer society. Most of the people in Hong Kong were not working for living only, but also desire for amenities of life. One of the symbols of society is purchasing famous brand products. Famous brand products are always an identification of a person and also a guarantee of quality. Since it is so, the famous brand products must be in a high price and with a rare production. They will never cut down the price as well. Only few people in the world are able to own the luxuries and the owners can draw the others’ attention. The objective of this investigation is to gather information and determine consumption use with audience analysis regarding the famous brand products.
Hong Kong's economy and society developed rapidly after World War II, Eastern and Western cultures intersected in this area, making it one of Asian four small dragons. After New York and London, Hong Kong is the third largest financial center in the world. It is one of the major shipping hubs and the most competitive city in international and Asia-Pacific areas. Hong Kong is famous for its good and order, free economy and sound legal system, it is known as the "Pearl of the Orient", it is also one of the world's richest, most economically developed regions with highest living standards.
1.2 Introduction about Louis Vuitton (LV)
Louis Vuitton, can be shortened to LV, is a French fashion brand founded in 1854. The classic label of Louis Vuitton – Monogram showed on most of their products. They designed many different products like clothes, shoes, jewelries, watches, accessories, and books. Louis Vuitton is one of the leading international fashion brands in the world. According to online information, for six consecutive years (2006–2012), LV was known as the world's most valuable luxury brand. Its 2012 valuation was US$25.9 billion. The 2013 valuation of the brand was US$28.4 billion with revenue of US$9.4 billion. The company operates in 50 countries with more than 460 stores worldwide” (Louis Vuitton, 2016). #p#分页标题#e#
Louis Vuitton has designed and launched a suitcase when he was alive, called "Gris Trianon". The suitcase is very light and it appears with gray canvas decoration. After the launch of this suitcase, the wife of Napoleon III, Empress Eugenie also love it very much. After the death of Louis Vuitton, his son, George Vuitton built a world-renowned brand. In 1860, in order to get fit with the increasingly strong market demand, Louis moved his factory from Paris to Asnieres. In 1867, Louis Vuitton has won the bronze medal on the World's Fair, which makes his popular name “Louis Vuitton” brand more famous. Nevertheless, its influence even beyond France and started to become an international brand. In 1885, Louis Vuitton in London opened its first overseas branch. Because of its reputation, many fake products appeared. In 1888, George Vuitton introduced a new design of Vuitton luggage. He designed the surface of the box into a checkerboard style and the colors are brown and maroon. In addition, there was also printed “Louis Vuitton brand verification” on the suitcase label for people to distinguish (Louis Vuitton, 2016).
In 1893, George in the Chicago World's Fair showed the Louis Vuitton products. Henceforth, the brand officially appeared in the markets of United States. Since then, George has been committed to improving the international reputation of the brand. In 1894, he published the book “Journey”. In 1896, Louis Vuitton has officially launched a branding function canvas design, known as the “monogram canvas” because this new canvas have a large number of applications and symbolic meaning of symbols as Louis Vuitton always marked as “LV”. Subsequently, George went to the United States again, traveled to New York, Philadelphia and Chicago and other large cities, aimed at the popularization of the Louis Vuitton brand (Louis Vuitton, 2016).
In 1946, after World War II, in order to resist the recession situation, Louis Vuitton began designing luggage beyond his old line, he also invest and develop in other areas. 1978, Louis Vuitton opened its first stores in Asia – Japan. The concepts of this old brand are, “Louis Vuitton. Behind the legendary name is the journey of a visionary man who profoundly changed the art of luggage making, and in doing so, changed the notion of Travel itself (Louis Vuitton, 2016).”
The magazines in Hong Kong always post the new products of Louis Vuitton as the fashion trend. This action is virtually become an indirect promotion (Louis Vuitton, 2016).
1.3 Research aims and objectives
Hong Kong has always been one of the most important markets of LV, but since 2014, the sales in Hong Kong declines, for LV and those personnel engaged in marketing of luxury goods, to discuss how LV adjusts its marketing strategy is a issue of value. The aim of this research is to study how LV develops an appropriate marketing strategy based on the characteristics of consumers in Hong Kong in future. Based on this, it forms the following research objectives:#p#分页标题#e#
Objective 1: to explore the characteristics of consuming behavior of consumers relating to LV products in Hong Kong currently;
Objective 2: to compare similarities and differences between current and past consuming behavior of consumers relating to LV products in Hong Kong
Objective 3: to make recommendations on how LV develops appropriate marketing strategies in Hong Kong in future.
2.0 Body 主体
2.1 Literature review
“Consumerism is a way of life combining high levels of material affluence with an emphasis on symbolic and emotional meanings associated with shopping and possessions. The United States continues to lead the way, but the phenomenon increasingly is of global scope. Consumerism can be interpreted positively as a means of stimulating the economy while facilitating people’s liberties to shape their identities and subcultures. The one unambiguous result of modern capitalism, of the industrial revolution, and of marketing ... is: In the way we live now, you are not what you make. You are what you consume’’ (Twitchell, 2002, p. 1).
2.1.2 Consumer culture
Consumer culture can be defined as a “social arrangement in which the relations between the lived cultural experience of everyday life and social resources, between meaningful ways of life and the symbolic and material resources on which they depend, is mediated through markets” (Sheth and Maholtra, 2015).
Oriental society is a collective society in which people are closely linked, people are very concerned about the evaluation from the society and other people. This determines that oriental consumers buy luxury goods for consumption and having some kind of luxury goods to show off their wealth, identity, status and so on (Mooij, 2011).
Lifestyle refers to people’s values and aesthetics towards food, clothing, housing, transportation, labor work, recreation, social interaction and other material and spiritual life. After World War II, economy in Hong Kong developed a lot, people's income and living standards have been greatly improved. Meanwhile in Hong Kong, the people are deeply influenced by Western culture, and they have universally accepted systemic higher education, thus many people in Hong Kong pursue a more stylish, international and maverick way of life, which is an important reason for the popularity of luxury goods in Hong Kong (Kang and Park, 2016).
2.2 Audience analysis
In this study, it makes use of an ethnographic research method, through interviews to collect information. The author randomly selected 10 consumers in LV shops in Zhonghuan CBD in Hong Kong as research objects.
2.2.1 Results of interview#p#分页标题#e#
220.127.116.11 Why do you buy LV products?
Only a respondent said that he purchased LV products because he loved fashion and luxury culture, 3 respondents expressed that LV products have reliable quality, very stylish design, which were the main reasons for their purchase of LV products. 4 consumers believed that they bought LV products because there were a lot of people (around them) who purchased LV products, LV products have a very good reputation; 2 individuals explained that they purchased LV products for presenting other people.
18.104.22.168 Which channel do you take to understand LV products?
6 respondents said that they were mainly through the network to understand LV products; there were 2 respondents who thought that they were primarily through magazines to understanding LV products; 2 respondents believed that they mainly understood LV products through television.
22.214.171.124 How many LV products have you purchased?
2 respondents said that they have purchased 3; 4 respondents said that they have 5; 4 respondents expressed that they have bought more than 5.
126.96.36.199 What benefits did the purchased LV products bring you?
2 respondents felt that LV products complied with their personal preferences and aesthetic. 3 respondents said that possessing LV products was a symbol of success for them. 5 respondents mentioned that they purchased and used LV products because this made them different.
188.8.131.52 What percentage of your monthly income does the cost for a LV product account for?
5 respondents said that it was about 30%, 3 respondents mentioned about 35%, 2 respondents thought that it was about 50%.
Consumerism is a way of life combining high levels of material affluence with an emphasis on symbolic and emotional meanings associated with shopping and possessions (Twitchell 2002). With the development of economy, people in Hong Kong have been affected by consumerism, which can be seen from the level of consumption rate of residents in Hong Kong. Consumption rate refers to the ratio that the total amount of personal consumption of residents and social consumption of a country or a region accounting for in GDP during a given period of time. Consumption rate in Hong Kong in 2013 was 66.1%, ranking second in the world, to a certain extent, it confirmed the prevalent consumerism in Hong Kong. Generally speaking, if the ratio of costs for luxury is lower than 30% of monthly income, it belongs to rational consumption. The survey results in this study showed that all respondents said that they spent more than 30% of their monthly income on LV products, and the results also proved that 60% of the consumers purchased LV products not for their preferring LV products and the culture, but for the symbolic value and brand value of the brand. These survey results indicated that these consumers are willing to spend a fortune to buy LV products, which is not for actual use value of the products, but for symbolic and emotional meanings, revealing that consumers in Hong Kong buy LV products because of being affected by consumerism (Miller, 1998).#p#分页标题#e#
Data show that Hong Kong is one of the world's largest consumption markets of luxury goods. The findings of this essay showed that all the respondents have purchased three or more LV products, which to some extent indicated that the purchase and use of luxury goods has become people’s way of life in Hong Kong. It is unlike in many other markets that in Hong Kong, a luxury usually represents a middle-class way of life, rather than the lifestyle of a high society (Bain company, 2013). Middle-class consumers often seek more fashionable, international and maverick lifestyle, Hong Kong's most influential fashion magazines and department stores have spared no effort touted luxury brands, and it is these magazines and department stores influence most middle class people’s understanding of fashion in Hong Kong, they also influence the people’s perception and acceptance of luxury (Storey, 2011). For the marketing of LV in future, how to carry out marketing aiming at the way of life of the middle class is a valuable subject.
In the past, consumers in Hong Kong knew luxury brands primarily through department stores and fashion magazines. Considering from the results of the survey in this essay, half of the consumers understood LV products through the network. It shows that with the advent of the Internet age, as well as the youthization of luxury consumers, more and more consumers come to understand LV products through the network. The survey results revealed that the marketing of LV in future should take the network as an important channel.
Consumption culture can be defined as a “social arrangement in which the relations meaningful ways of life and the symbolic and material resources on which they depend (Sheth and Maholtra, 2016). Considering from the survey results in this study, only 2 respondents believed that LV products complied with their personal preferences and aesthetic. This part of consumers buy LV products because they think that the products have reliable quality, exquisite design, and materials used are sophisticated, they buy the products because the products can meet their actual needs. While 3 respondents thought that possession of LV products was a symbol of success. 5 respondents believed that they purchased and used LV products because this made them look different. For this part of consumers, LV products can meet their needs of a symbolic meaning, for example, the use of LV products can show their affluence, making them look more noble or have a distinct personality. Therefore, from the point of view of consumption culture, most consumers in Hong Kong believed that purchase of LV products could meet their needs in a symbolic sense. Therefore, in the future marketing process, how LV maintains the symbolic value of the brand in a higher standard is a question that is worth of considering.
Considering from the survey results, due to the impact of consumerism, consumers of LV products in Hong Kong have a unique consumer culture, LV consumption in Hong Kong has been integrated into consumers' lifestyles. Compared with in the past, the main population of LV consumers in Hong Kong product is the middle class, rather than the upper-class of the society, it is this reason that makes the marketing of LV products in future be adjusted accordingly.#p#分页标题#e#
2.3.1 First, from the pricing point of view, in the past, in order to maintain the brand image of luxury, prices of luxury goods are always very high, and they rarely cut down prices for sales promotion. When the middle class becomes the main population of consumption of luxury goods, LV’s product pricing strategy should be adjusted accordingly. When LV introduces a new product, the price of the new product should be maintained at a high level, while for old products, LV can provide preferential prices to attract consumers to buy.
2.3.2 Secondly, from the point of view of marketing channels, sales channels of LV in Hong Kong in the past in sales promotion and propaganda were well-known magazines and shopping malls. While the majority of today's middle-class in Hong Kong are young people, many of them understand LV products from the Internet and mobile phones. In the future, LV can make more use of the network, social media on the Web, APP and other channels to promote and sales promotion of LV products, these channels not only help to increase sales, but also help to improve customer loyalty (Kim, 2008).
2.3.3 Although the consumer groups of LV exhibit the characteristics of civilian population, LV can be sought after by consumers because of its high-end brand image, therefore it is necessary for LV to take further measures to maintain its high-end brand image. For example, LV can cooperate more closely with the Hong Kong government to combat counterfeit LV products, and it can introduce limited edition products and invite popular stars with good social images as a spokesperson.
2.3.4 Now, it is very competitive in the luxury goods market in Hong Kong, consumers’ loyalty for a brand is relatively lower. Simply implementing markdowns and sales promotion are unable to improve long-term customer loyalty effectively, but likely make enterprises be involved in vicious price competition. Allowing consumers to understand their own brand culture and history will help LV to improve brand loyalty effectively (Miller, 1998). In this study, the survey results showed that most consumers are in fact not very clear about the history, culture, heritage of LV. Thus, in the future LV can make use of some public relations activities, such as new products release, exhibitions, receptions and or sponsored activities to strengthen brand communication. At the same time, in the promotion, culture included in the brand should be the main content of corporate propaganda, in order to narrow the gap with customers who love the culture, charm of luxury lies in its unique cultural connotation and temperament, as well as the unique cultural charm.
3.0 Conclusion 结论
3.1 Main points
This study is through ethnographic research methods to learn the characteristics of consuming behavior of Hong Kong consumers in purchasing LV products, based on these characteristics to bring forward recommendations on how LV adjusts its marketing strategy in future.#p#分页标题#e#
With the development of economy in Hong Kong, the people have also been affected by consumerism, which makes the consumption level of residents in Hong Kong rank second in the world. Findings of this study also showed the consumers were willing to spend a fortune to buy LV products, which was not for the practical value of LV products, but for the symbolic and emotional meanings of the products, which confirmed the high consumption level of residents in Hong Kong. Data states that Hong Kong is one of areas in the world in which consumers purchase the most luxury goods. This to some extent indicates that the purchase and use of luxury goods has become a way of life people in Hong Kong. It is unlike in many other markets that in Hong Kong, a luxury usually represents a middle-class way of life, rather than the high society lifestyle. From the perspective of consumption culture, most Hong Kong consumers believe that LV products can meet their needs of a symbolic sense, therefore, in the future marketing process, how LV maintain the high standard of the symbolic value of the brand will be a question that it worth of considering. Compared with in the past, the main population of LV consumers in Hong Kong product is the middle class, rather than the upper-class of the society, it is this reason that makes the marketing of LV products in future be adjusted accordingly. Firstly, the product pricing strategy should be adjusted accordingly. When LV introduces a new product, the price of the new product should be maintained at a high level, while for old products, LV can provide preferential prices to attract consumers to buy. Secondly, in the future, LV can make more use of the network, social media on the Web, APP and other channels to promote and sales promotion of LV products, these channels not only help to increase sales, but also help to improve customer loyalty. Thirdly, LV can be sought after by consumers because of its high-end brand image, therefore it is necessary for LV to take further measures to maintain its high-end brand image. Finally, it should strengthen propaganda for the brand culture and connotation, which helps to improve customer loyalty to avoid falling into price competition.
3.2 Further research
Judging from the survey results, the consumer groups of LV exhibit the characteristics of civilian population, it is necessary for LV to adjust its marketing strategy aiming at the consumers of middle class, for example, it can lower prices to improve sales, which will inevitably undermine the high-end brand image of LV, because luxury which are originally possessed only by minorities will be owned by the public, and the high-end brand image of LV is also the important reason for consumers’ love for LV products. Damage of brand image is not conducive to improve the future market competitiveness of LV. Therefore, how to maintain the best balance between maintaining brand image and increasing sales will be one of the important topics of future research.#p#分页标题#e#
Bain company (2013) 2013 Luxury Goods Worldwide Market. Retrieved June 10, 2016
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Kang, Y. and Park, S. (2016). The Perfection of the Narcissistic Self: A Qualitative Study on Luxury Consumption and Customer Equity. Journal of Business Research, 69(9), 3813-3819.
Louis Vuitton. (2016). Brand Protection. Retrieved June 10, 2016
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Storey, J. (2010). Newspapers and Magazines’ from Cultural Studies and the Study of Popular Culture. Edinburgh: Edinburrgh University Press, 93 – 117.
Twitchell, J. B. (2002). Living It Up: Our Love Affair with Luxury. New York: Columbia University Press.