Shanghai Tang Case Study

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Case Study

Shanghai Tang: The first Global Chinese Luxury Brand?

1) What is a luxury brand?

A luxury brand is a brand that consumer associates it with luxury. Most of its products are luxury goods. It includes brands whose names are associated with luxury, high price, or high quality goods.

A luxury brand is associated with sophistication (1 out of 5 brand related dimensions). Brands that are considered upper class and charming, high in sophistication dimension scale: E.g Cartier, Rolex are well- known luxury brands. Mercedes- Benz would be one of the few that consumers will think of a luxury automobile brand.

How is it different from a regular, mass market brand?

Regular mass market brand do not have or has very little form of identification and has low or no brand equity. It could also be that it is a brand used regularly but consumers do not have strong brand recognition and brand recall. A luxury brand possesses a high equity because consumers believe these brands have the ability and willingness to deliver on their brand promises. A mass market brand focuses on high sales and low prices. A regular or mass market brand is usually low in price and usually is essential but not affluent unlike luxury brand. E.g. Casio as compared to Rolex watches.

How does one build a luxury brand?

Brand equity is built upon Brand Knowledge that consists of 2 forms: Brand Awareness and Brand Image. Brand awareness is the basic dimension of brand equity. A brand has no equity unless the consumer is at least aware of the brand. One has to first achieve brand awareness and then strive to maintain high levels of brand awareness.There are 2 levels of awareness: Brand recognition and recall. Brand recognition reflects a relatively superficial level of awareness whereas brand recall is a deeper form. In order to achieve brand recall, effective and consistent marcom efforts are needed, this is to move brands from a state of unawareness to recognition and on to recall and ultimately at the top of the mind (TOMA status).

Building Brand Image or having brand image represents the associations that activated in memory when people think about a particular brand. The associations can be conceptualized in terms of type, favourability, strength and uniqueness.

Under types of associations, there are Attributes, benefits and attitudes this is where consumer will find the link to brand, what is the brand to the consumer, when they think of the brand what do they think about or what triggers them to think about the brand this is where one identify the link of brand to consumer.

Build on the brand’s personalities- Sincerity, Excitement, Competence, Sophistication and/or Ruggedness. It can be a range across the 5 from the dimension describes the brand to not at all.

To build a Luxury brand here one would need the brand personality to be very high on sophistication and they could have a little of Excitement, Competence, Sincerity. The whole process can be referred to the diagram 1.0 below.

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2) How would you characterize Shanghai Tang’s brand image and sources of brand equity?

Shanghai Tang’s brand image is the reinvention of Chinese style that showcased the beauty and mystery of China that holds rich historical value. It is definitely a very unique brand as it entails Chinese history into it’s products for example the apparel is clearly unique as certain of the details are design taken from the traditional Chinese wear in the past which you can’t find the design from Ralph Lauren or Giorgio Armani which are both also luxury brand image. It is well liked by rich tourists in Hong Kong who would buy their signature jacket, a tunic with mandarin collar in shockingly bright colours or a silk handbag embroidered with cherry blossoms.

For the local young Chinese woman they found the brand image and the products especially...
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