Marketing Luxury

A fascinating example of marketing luxury products targeted at rich, single men is Diageo, the world’s leading alcoholic beverage company. Though Diageo has many products that span the price spectrum, the company concentrates on its luxury brands, treating them like precious loved ones. Some of Diageo’s luxury offerings include Johnnie Walker Blue, Crown Royal XR, Ciroc Vodka, and Don Julio 1942.

Diageo’s method of marketing bears examination. The company designed its marketing around its reserve brands, which include 24 high-end luxury items. Diageo uses what they call “marketing disciplines” to keep their brands visible to affluent customers, many of whom are rich, single men.

For one thing, they utilize “influencers,” who are high-profile celebrities. Diageo hooked up with Sean “Diddy” Combs, because they felt he could influence a segment of their market in a powerful way. For another, Diageo has a “Guru Influencer.” The Guru Influencer is whiskey expert Charlie MacLean. Wealthy customers who are “in the know” trust MacLean’s expertise, and therefore value his recommendations. Third, Diageo uses “Socialite Influences.” Socialite influences are high-net-worth individuals who have lots of exclusive parties and know lots of elite people.

To these three methods, Diageo adds their Mentorship Program, which is a program that educates customers and tradesmen about the company’s unique history, its origins, and the way it makes its products. Diageo also takes great care in nurturing its “Gatekeepers,” who are the bartenders. Bartenders are the faces of the company, according to Diageo, because they are the ones who sell the brand person-to-person. Diageo provides bartenders with access to special events, junkets, and free gifts.

Finally, Diageo ensures its marketing direction by being aware of changes in the market, responding quickly to new niches that open up. For example, the company is presently test-marketing a premium rum, because they see a door opening in this area.

The result of Diageo’s marketing? There has been a constant increase in demand for luxury alcoholic beverages. From 2007 to 2009, the ultra-premium segment of the company’s market grew by 14%. And they believe growth will continue through 2010 into 2011.

Diageo’s method of marketing is a template that any seller of luxury products would do well to emulate, because Diageo found a way to diversify its offerings without cheapening its brand. By keeping its ear to the ground, Diageo is able to detect changes in the market rather than just reacting to the changes.