High-end brands have woken up awakened to the power of social media because of some compelling statistics. "Households earning over $100,000 a year are on the Internet 23 hours a week and on Facebook six hours a week," said Bernie Brennan, co-author with Lori Schafer of "Branded: How Retailers Engage Consumers with Social Media and Mobility." And 80 percent of households with annual incomes of more than $240,000 use social networking, primarily Facebook, said Brennan. Luxury brands now realize "there's a new way to communicate and if retailers or brands are not engaging in social media, they're missing an enormous market opportunity," he said.
Some of the world's most exclusive names are quickly becoming the world's most engaging brands. Why? It's simple really. Facebook is the social media home to millions of affluents.
These statistics are the sirens song to luxury brands:
– Households earning more than $100,000 spend 6+ hours per week on Facebook
– 80% of households earning more than $240,000 use social media, primarily Facebook
Luxury brands are realizing the intrinsic value of having both affluents and aspirational customers interact with their brand and products at a time and place of their choosing.
So it's little wonder that BMW, Gucci, Chanel, Ritz-Carlton and Louis Vuitton have jumped headfirst into social media, particularly through Facebook.
Burberry has used direct engagement – such as asking Facebook users to submit photos and videos of themselves carrying the signature raincoats and handbags – to boost "likes" to more than 6 million.
One facet of social media metrics that is vastly underappreciated, however, is influence. When a user "likes" a brand, they broaden the degree of influence for that brand.
Even if the user themselves is aspirational and cannot yet afford the brand, generally users will have another 10-20 Facebook users within their network that can afford the brand. By "likeing" the brand, they are spreading the luxury brands influence directly to all of the users within their network. When that "like" shows up on their wall or stream, it serves as a call to action for other users to engage with the brand.
For example, if I "like" a new car from BMW, it will post to my wall. It will be seen by my entire network and the peer influence fundamental will prompt my friends to "like" that BMW and engage with the brand. If the average Facebook user has 130 friends, then Burberry's 6 million fans potentially influence tens of millions of Facebook users.
Luxury brands, with historically smaller traditional footprints and touch points, are finding a home on social media. And with 83% of affluents now making purchases online, Facebook and social websites have truly become the new showcase for the world's premiere brands.