Luxury or premium ? Knowing the difference: the Hugo Boss case
Founded in 1924 in Germany, the Hugo Boss company might seem - to the uninitiated - like some sort of luxury brand, with its fashion collections, sumptuous accessories, delicate fragrances, and expensive price tags. How come it isn't?
Luxury and premium are two different categories; both share similarities but differ in key elements; those elements are the focus of today's article, or more accurately, how does Hugo Boss mark points as a luxury brand and how does it diverge from the luxury path in a way that excludes it from even being one. An outlook into what it means to be luxury or premium, and how price and history does not necessarily create a dream.
Since 2014, Hugo Boss has achieved step by step to get into the luxury market with his Boss Black offer (Joly, 2012).
With his new brand Ambassador Chris Hemsworth, Hugo Boss has chosen a fashion, beauty, and ecological representative. (Iakovou, 2021). The brand can show an image of modernity, self-confidence, and authenticity. The campaign wants to share an ecological and nature beautiful style brand image (Guinebault, 2014). Hugo boss wants to be seen as the leader of a sustainable company in the luxury textile industry and draw attention to species protection (Halliday, 2021).
Currently Hugo Boss is not a luxury brand. It is considered a premium brand because it targets people who can push themselves to pay more than what they would pay for a regular product. （Adegeest, D. 2021, September 20) Luxury brands are for people who don't care about how much they pay for something (they want to feel special). Hugo Boss is currently divided into two product lines, Hugo and Boss （Boss Ag, H. 2021) , and they removed the OSS Orange and BOSS Green brands in 2016, competing with BOSS with Burberry, Prada and Armani. HUGO's rivals have become Rag & Bone, the Kooples, etc.
In 2012, Italian luxury brand Dolce & Gabbana closed its subsidiary line D&G, and in 2015, MarcJacobs closed its subsidiary line Marcello. MarcJacobs merged the secondary brand MarcbyMarcJacobs into the main line; CKCalvin Klein and Calvin Klein two lines also finally merged into the unified Calvin Klein.
Hugo Boss has Germanic precision, high quality material, and smart tailoring. However, these factors are more about effort. It is lacking the pure emotion without which there is no true luxury (Kapferer & Bastien, 2012).
It is lacking the pure emotion without which there is no true luxury.
Hugo Boss strongly invests in its price-value proposition, specifically the BOSS brand is fostering its unique positioning in the premium / affordable luxury segment. This violated the first anti-law that luxury is superlative and not comparative, not to mention that price is not a determinant of luxury. A luxury brand has an identity but not a positioning (Kapferer & Bastien, 2012).
Moreover, Hugo Boss's strategies (eg, targeting a younger consumer group with more trend-driven styles, opening extra growth possibilities with heavy investment in online and response to the rising demand in China….) Make it be too accessible and lose the attachment with heritage needed for a luxury brand.
In order for Hugo Boss to get closer to becoming a Luxury Brand, the firm should enforce its dream image.
To do so, Hugo Boss should first and foremost repurpose its know-how culture; indeed, its Germanic precision, high quality material and smart tailoring should be linked to the brand expertise and advertised as such, but not be its primary selling point. Indeed, said selling point should be its symbolic value, the achievement and status linked to possessing it.
Then, the firm should get rid of its positioning and strictly focus on establishing its identity. The firm has recently partnered with social media influencer Khaby and should definitely partner with more influencers in order to strengthen the social media presence of the Hugo Boss dream, spreading awareness beyond the people that will actually purchase their products.
Finally, Hugo Boss' strategy should restrict its distribution and instead focus on generating revenue by selling goods with artificially inflated prices to a loyal consumer base and avoid relying on a price-value proposition.
It is possible to create a dream brand from scratch. However, even if it is possible, this does not mean everyone is able to do it. Unfortunately, there is no miracle recipe that allows the first entrepreneur to create a successful luxury brand in a few weeks.
Indeed, for the creation of the brand to be successful and to join the pantheon of dream brands, several criteria must be respected. The most important of these is undoubtedly the experience: the brand must be experiential rather than simply product oriented.
Moreover, this brand must be able to boast a heritage. This is difficult for a new brand, you might say, but that's where storytelling comes in, as it will be an essential tool in the branding communication.
Furthermore, a new brand can more easily appropriate digital tools and find a better balance between heritage and new technologies.
Finally, it will be necessary to make this brand hedonic, for instance, by using influencers such as vloggers who travel often, or who display a lifestyle aligned with the image and universe of the brand.
The Luxaholic TeamREFERENCES
Bruno Joly (Jul, 2012) Hugo Boss terminates Selection https://fr.fashionnetwork.com/news/hugo-boss-met-un-terme-a-selection,267524.html
Sandra Halliday (Feb, 2021) Boss unveils first Chris Hemsworth campaign under new deal
Pascal Iakovou (Jan, 2021) HUGO BOSS appoints Chris Hemsworth as the first BOSS Global Brand Ambassador
Matthieu Guinebault (Oct 2014) Brands: luxury, sport and fashion remain in the world rankings
Adegeest, D. (2021, September 20). Does Hugo Boss have ambitions to be a luxury group? FashionUnited. https://fashionunited.com/news/business/does-hugo-boss-have-ambitions-to-be-a-luxury-group/2021092042219
Boss Ag, H. (2021). HUGO BOSS Group: Strategy. © 2018 HUGO BOSS AG. https://group.hugoboss.com/en/company/strategy
Kapferer, Jean-Noël, and Vincent, Bastien. (2012). The Luxury Strategy: Break the Rules of Marketing to Build Luxury Brands. 2nd ed. Kogan Page.
Hmetzingen (2021). UGO BOSS presents new growth strategy ‘CLAIM 5’ aimed at doubling sales to EUR 4 Billion by 2025. Hugo Boss Group.
Vivian Hendriksz. (2016). Hugo Boss unveils strategic plan to turnaround company. FashionUnited.
Maria Hunstig. (2019). How Hugo Boss got back on track. Vogue Business. https://www.voguebusiness.com/companies/hugo-boss-germany-retail-ceo-mark-langer-e-commerce-chinese-luxury
Morhart, F. 2021. Luxury Marketing [slides]. HEC Lausanne. Unil
Wikipedia article Hugo Boss (consulted last the 10.10.21) https://en.wikipedia.org/wiki/Hugo_Boss
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