In response to the global trend of making sustainable development an urgent task, luxury fashion brands actively embrace it in their corporate philosophies and management policies. However, despite the widespread consensus in the related industry and the strong will of companies for the sustainable development of luxury brands, there are still few cases of luxury fashion brands successfully implementing sustainable development. This study examined the impact of the types of message framing on the sustainability marketing of luxury fashion brands, focusing on their effects on perceived message effectiveness, sustainable brand image, and brand attitudes. An online survey was administered to 464 Korean consumers in their 20s to 40s to test the hypotheses. The results showed that perceived effectiveness was higher for negatively framed messages (loss) than for their positive counterparts (gain). The types of message framing did not significantly affect sustainable brand messages, and no significant difference in perceived brand image was found, regardless of message type. Perceived message effectiveness exerted a significant positive effect on sustainable brand image, and such an image had a significant positive effect on brand attitudes. The results provide implications for related research and practical implications for the development of competitive sustainability marketing strategies for luxury fashion—an industry still in its infancy.

The development and application of NFTs has gained great attentions. Especially, with the eyes on the potential of Metaverse and Web 3.0, NFTs are regarded as one of the foundational parts of the future internet. The main contribution of NFTs is the innovative solution for creating digital uniqueness through its property of non-fungibility. With this property, the ubiquity caused by replicable data on the current internet can be advanced with NFT-backed uniqueness, which can assist in certifying authenticity, authorship, and possessions of contents, products, and assets online. This has tremendous meaning for the luxury brand industry, which has been struggling with the ubiquity of the internet for years. The emergence of NFTs, however, represents hope and a potential mean to represent scarcity in a digital context. By the use of NFTs, luxury brands’ conservative digital marketing strategies and their ways of production design, marketing, consumer management could be fundamentally changed. This study aims to discuss the NFT marketing strategy from the perspective of luxury brands. Particularly, the study will investigate the desirability strategies in these luxury NFT cases. To do so, the study uses a socio-technical perspective to understand how luxury brands embody the desirability strategy through NFTs, by considering the technical factors of NFTs (i.e., design, issuance, and ecosystem functioning) and social factors of desirability (i.e., exclusivity, rarity, prestige, and creative leadership). The study explores applicable strategy of how to realize luxury desirability through NFT technics. As a result, this study investigates 39 luxury NFT cases from 2021 to 2022, including the NFTs launched by famous luxury brands such as Gucci, Louis Vuitton, Burberry, Dolce & Gabbana, and KARL LAGERFELD. The study showcases three within-case analyses to exhibit vivid examples of NFT innovations. Besides, the study generates a common framework by a complete cross-case analysis. The framework contains three domains and seven dimensions to guide further luxury NFT innovations and contributes to theory development in the field of NFT marketing and branding.

As the demand for luxury brands faces uprising trends in popularity, marketing strategies strive to fully encompass the shifting tides of the market. Especially, high-end customers, hereby VIPs, are heavily nurtured based on their high-spending nature. With the understanding of VIP sales behavior based on social comparison and the adequate use of VIP marketing programs, luxury brands can optimize their sales of luxury brands. However, scant research examines the simultaneous impact of social comparison and VIP marketing in the luxury industry.

With the growth of blockchain technology, the potential of NFTs is receiving significant attention across all industries. As NFTs emerge as a novel type of asset, they are drawing attention as a potentially important market, particularly for many luxury goods. This study aims to understand the concept of NFTs and their influence on e-WOM. This study develops a research model that facilitates an understanding of luxury brands’ NFT marketing activities and tests it with a consumer survey. Our analysis reveals important characteristics of perceived NFT marketing activities such as scarcity, resaleability, and authenticity. Furthermore, the impact of specific NFT marketing activities and their influence on e-WOM are discussed. This study contributes theoretical insights for researchers and has practical implications for practitioners who manage marketing activities for NFTs.

Introduction The fashion business is known as one of the major industries that is suffering from rising concerns about the consumption of its product, which led to a reorganization of the fashion supply chain to become more sustainable three decades ago. The interest in the concept of sustainability and demand for sustainable marketing activities is gradually growing in the fashion industry due to the negative image and press it receives. Within the luxury fashion segment, the three main themes that are recognized to contribute to sustainability are exclusivity, craftmanship and limited production. However, luxury brands are increasingly shifting their attention and commitment towards environmental and social issues to be incorporated in the concept of sustainability. Yet, the majority of consumers has little understanding or misunderstands the concept of sustainable fashion and marketing, which leads to a gap between attitudes towards sustainability and actual behavior. As a result, fashion brands are trying to leverage their brand by making sustainability a key marketing strategy to raise awareness about social, environmental, economic and cultural issues. Extant research has not explored this recent trend to understand how consumers evaluate fashion brands with a sustainable marketing communication, especially in the context of luxury brands. This study investigates how luxury and mass fashion brands can utilize sustainable marketing contents in social media communication to reach their target group and enhance their equity with sustainability associations. Theoretical Development Associative network models of memory have served as a fundamental framework for a wide range of studies related to the formation and transfer of associations. According to associative network theory, brand knowledge is represented in form of an associative network of memory nodes connected to each other. Nodes are activated when cues, such as advertising, are presented. Mere exposure to cues was shown to be sufficient to active associations and facilitate association transfer. While brands are continuously attempting to make use of associative power to leverage brand equity, extant research has provided compelling reasons to accept that association transfer can also result in brand dilution when a retrieval of conflicting or negative associations occurs. Especially in the context of luxury brands consisting of very unique associations and being different from mass brands in many regards, managing the brand’s associative network is a crucial task in order to send the right signals to consumers and maintain exclusivity. This study investigates how social media communication of different sustainability dimensions affects brand attitude and how it ultimately impacts behavioral outcomes in an attempt to build brand equity for mass and luxury fashion brands. Method and Data The hypotheses are tested with 273 respondents who participated in an online experiment. They were first asked to state their involvement with the category fashion. Subsequently, subjects were presented with a brand post either for the mass or luxury brand including claims related to one of the four sustainability dimensions or no claims for the control group respectively. The experiment consisted of a 2 (brand: mass or luxury) x 5 (sustainability dimensions: none, cultural, economic, environmental, social) factorial design. The measures that followed included attitudinal as well as behavioral constructs related to the brand, sustainability as well as social media use. Analysis of covariance is applied to test for main effects and interaction effects. Summary of Findings This study provides evidence that social media communication of a sustainable brand affects the purchase intention of consumers. The findings indicate a significant difference between the mass and the luxury brand used for this study. The mass brand exhibits the potential to leverage associations with cultural, economic, and environmental sustainability. However, the results only reveal a marginally significant higher purchase intention when cultural sustainability is communicated compared to when the brand does not provide any sustainable associations. In contrast, the luxury brand suffers from significant brand dilution across all four sustainability dimensions resulting in a decline in purchase intention. Key Contributions The findings reveal that sustainability communication exerts a diverging influence depending on the type of brand that is involved. This study suggests that mass brands are able to benefit from sustainability communication in an attempt to leverage brand equity. However, for a luxury brand this type of associations rather presents a liability that might dilute the brand. The findings of this study provide important insights for brand managers. Since mass brands are currently increasing efforts into sustainable communication in the fashion industry, the results suggest that this might be a promising investment. However, luxury brands are advised to carefully manage the communication of salient content related to sustainability as it might harm the invaluable and unique associations inherent in a luxury brand.

This paper investigates the (presently unexplored) relationship between a peculiar kind of performing art, i.e. opera (as in the Western musical tradition), and the fashion and luxury business within the context of fashion cities. In particular it investigates, on the one hand, how the relationship with opera production may benefit the marketing strategy of luxury companies and, on the other hand, how opera houses may profit from the relationship with the luxury industry. As a preliminary work, introducing a new research project, its aim is to provide a tentative systematization and clarification of the research questions and to stimulate an early discussion of their consistency and relevance. Three sets of research questions are proposed for discussion and further exploration, concerning: a) the audience segmentation of opera as experiential luxury (based on self-congruency theory) and its implications; b) the luxury industry as opera sponsor; c) integrating opera in luxury marketing strategy (brand heritage vs. opera heritage).

Introduction According to the Federation of the Swiss Watchmaking Industry (FHS) in 2017, Switzerland occupies approximately 3% of the global market regarding the quantity of watches. As for value, Switzerland represents 54% of global sales that is 21 billion USD. About 95% of luxury watches with price starting from 1,000 USD are stamped "Swiss Made.” Thus, the Swiss watch industry has become an integral part of the luxury universe. However, it‟s not an easy task to get a place in this luxury market of reference. According to the estimation made by the Institute of Watch Marketing, there are approximately 200 active Swiss watch brands on the market today. In order to create an uncontested market space and stand out from the competition luxury watch brands are obliged to create a new way of dealing with concurrence. The majority of brands chose the positioning at the top of a watch pyramid. First of all, it is an economic issue: according to the recent Deloitte report (2017) on watchmaking industry, the most important increase is in the category of watches belonging to the “Haute Horlogerie” segment. While other categories have been steadily losing their shares in exports for years, the high-end category of watches is growing considerably. In the last two decades, luxury brand management has attracted much interest and discussions in academic and business circles. Among the business leaders and scientists, the debates were related to the challenges and paradoxes associated with luxury branding and management that emerged as a result of the evolution of the field (Okonkwo, 2007; Kapferer, 2008 Chevalier and Mazzalovo, 2008, Dubois B., Laurent G., et Czellar S, 2001). In order to create and maintain the position of a strong luxury brand, a number of key elements have been identified as crucial and divergent within the scientific literature (Sicard, 2008; Fionda and Moore, 2008, Merle, Chandon and Roux, 2008). Vigneron and Johnson (2004) proposes key luxury dimensions that managers should establish and monitor for creating a lasting luxury brand. Nevertheless, in our opinion there are no many researches explaining hyper luxury segment growth and the upward expansion of the Swiss luxury watchmaking to the hyper luxury. To our knowledge, there is no scientifically accepted definition of the hyper luxury segment. We attempt to define hyper luxury watch brands as “Haute Horlogerie” watch brands with a unique positioning based on the personal-oriented perceptions of customers, high experiential value and proprietary manufacturing know-how, offering mainly mechanical watches in a price range starting at roughly 60„000 USD and then passing to the price categories of 100‟000-500‟000-1‟000‟000 USD for a watch. In order to shed light on upward expansion to Hyper Luxury trend in Swiss luxury watchmaking we should formulate the following research question: What kind of resources to optimize and which processes to implement in order to create resource-based competitive advantage in a highly competitive market of Swiss luxury watchmaking? Methodology To gain a deeper understanding of the upward expansion to hyper luxury in Swiss watchmaking industry we proceed to qualitative research (semi-structured interviews with 20 CEO and Marketing managers) among watchmaking companies. We specifically focused on top managers involved in the product development and decision making and management processes. The key issues addressed were: definition of the key company‟s resources, information management, market sensing, innovative approaches in management, sources of value creation for customers and differentiation strategies, managerial vision and firm-specific practices and procedures. Qualitative research methods were selected for this study with the aim to generate data rich in details and embedded in context. This study will allow us to enlarge and enrich previous theoretical findings and illustrate it with practical evidences. Conceptual framework Last decades have seen an important economic shift from manufacturing to information and knowledge-driven services. This shift has been accompanied by an increase in the importance of intangible assets and capabilities. Thus the source of competitive advantage has changed from mostly manufacturing assets to market based intangible assets and capabilities (Ramaswami et al., 2009). The resource-based theory (RBT) provides an important framework in explanation and prediction of the firm‟s competitive advantage and superior performance based on market based insights (Barney and Arikan, 2001, Vorhies and Morgan, 2005). RBT considers a company as an idiosyncratic mix of resources and capabilities that are available for application by various departments in the company and are very difficult to imitate by competitors (Teece et al., 1997). Accordiang to Barney and Hesterly (2012), sustainable competitive advantage results only if resources are simultaneously valuable, rare, imperfectly imitable, and exploitable by the firm‟s organization (VRIO). This VRIO framework has acknowledged that resources need to be leveraged effectively by the organization, instead of simply possessed by the firm. Even if a resource is valuable, rare, and imperfectly imitable, a firm must be “organized to exploit the full competitive potential of its resources and capabilities. According to Newbert (2008), performance improvement is not directly a function of the value or rareness of a firm‟s resource-capability combinations but rather of the advantages it creates from their exploitation. Then, through insightful theoretical development researchers have expanded the RBT into the concept of dynamic capabilities. Specifically, dynamic capabilities are defined as the ability to build, integrate, and reconfigure internal and external intangible resources to address rapidly changing environments (Winter, 2003). Teece et al (1997) and Eisenhard and Martin states that sustained competitive advantage could be based on the firm‟s renewal and reconfiguration of its resources and capabilities through dynamic capabilities. The dynamic capabilities view changes from the resource-based view of the firm (Barney, 1991), by its attempts to the explanation of the conditions under which firms achieve competitive advantage based on their resources and capabilities (Molina et al., 2014). Furthermore, researchers have increased conceptual understanding of the role of marketing in enabling firms to create and sustain competitive advantage and superior performance (Ramaswami et al, 2009). In accordance with potential to improve business performance, some studies (Bruni and Verona, 2009), have introduced the term „Dynamic Marketing Capabilities‟ (DMCs hereafter). In fact, DMCs are specifically focused on releasing and integrating market knowledge that helps firms evolve. Developing DMCs could constitute the real basis for sustainable competitive advantage and superior performance in most competitive sectors (Molina et al, 2014). Fang and Zou (2009) define DMC as the responsiveness and efficiency of cross-functional business processes for creating and delivering customer value in response to market changes. It is this focus on customer value that distinguishes DMCs from dynamic capabilities in general. According to Bruni and Verona (2009) DMC are those capabilities aimed specifically at developing, releasing and integrating market knowledge that helps firm evolve. Main findings and analysis Analysis of semi-structured interviews with the CEO and marketing managers of the Swiss luxury watchmaking companies lead us to a number of findings concerning the role of DMC for the hyper luxury brand expansion. The exploratory study confirms many of the elements presented in the conceptual part of this article. Most of the Swiss high-end watchmaking companies are traditionally founded focusing on specific kind of watch and technological expertise in it. Often, these companies tend to develop and grow by mastering their technological competences. As it comes from our research nowadays rare are companies that uses dynamic DMC. Even if the majority of companies confirmed the importance of DMC, it is very difficult to implement it on practice due to the complexity of the numerous stages of industrial production, various operations and partners. Meanwhile, there are some companies that managed to integrate the concept of dynamic marketing capabilities and improve their performance. A deeper questioning into their management practices revealed that they are achieving these results because of the sophisticated and effective way of implementation marketing insights coming from partners and clients. These high performing companies generate growth because of their particular focus for constant improvement of their marketing activities. “The main idea is to question all the time our way of working and to elaborate more sophisticated marketing mix than most of our competitors. For us, sophistication of our watches has the same importance as sophistication of our marketing activities”. Our research pointed out that these few firms of Swiss luxury watchmaking industry, that successfully accomplish the search and gap-assessment stages concerning dynamic marketing capabilities have an advantage over rivals. The market-based identification of valuable resources and internal management of intangibles help managers recognize the need for improvement. In a case of such particular industry as Swiss watchmaking where any considerable changes are very costly and time consuming the companies that applies DMC through small steps and project-based development assure their presence and adaptability to the globalized changes of the economy. “Swiss luxury watchmaking industry strongly related to the overall economic and social changes in the world. So we need to be constantly aware and understand global trends, for example, emerging categories of customers and their expectations towards luxury products”. Thus, dynamic marketing capabilities are considered as very important value creation drivers. We identified marketing intelligence, customer relationships and professional networks as the most important elements for additional value creation. “It is clear that information is very important in order to stay “up to date” with the market. As most of decisions and processes depends on the feeling of the current situation on the market and clients, it’s very important to gather as much information as possible. There is no one source of information, but the multitude of different sources and various information as a puzzle helps to construct the right vision”. Organizational capabilities, information sharing and collaboration between various departments are directly related to new value creation. As it came from the qualitative analysis the main conditions are the “openness” of management vision and strategic flexibility of decision makers. Moreover, high-performing companies participated in our research confirmed that it is very important to adopt an entrepreneurial attitude and to implement “participative” way of collaboration. “On the initial stages of product development, all departments are invited to give their feedback on the product. We organize regularly a brainstorming in order to obtain various perspectives. Cross-functional teamwork brings more value”. Those companies who could create some sort of flexibility in organization of production find themselves mostly on the niche market of hyper-luxury with a very personalized, sometimes even “co-created” watches. In this approach, it is a client, his visions and his preferences that are incorporated into the watch through its design, configuration, functions and complications. This phenomenon also confirms the recent trends on the luxury market of ultimate personalization and unique experience creation that accompanying the product. “People who could acquire almost everything that they want are looking for new experiences. Millennials are willing to pay higher price for personalized high-end and luxury items. The watch became not only the symbol of the status of its owner, but the reflection and continuation of the personality of a client. In this case a unique watch for somebody unique is a great concept”. Managerial recommendations Our research revealed that the concept of the dynamic marketing capabilities as a part of intangible resources of the company could be very beneficial for swiss luxury watchmaking companies in the process of expansion to hyper luxury segment. Managerial contribution of this article lies in new approach illustration that could be used as a support for strategic decision-making in Swiss watch-making companies. The concept of dynamic marketing capabilities is a very complex phenomenon. As a first step for improvement it would be important to get more informed and deeply understand it. In order to create more value and better performance, it is important to deep “intuitive” way of decision making and to implement more explicitly insights coming from practice. Traditionally very segmented industry of Swiss luxury watches is on the road to changes due to radical social and economic changes around the world. Nowadays, company growth and performance requires connecting many elements across various sources of data. There are more opportunities and synergies in initial collaboration on the basic steps of the expansion to hyper luxury segment of watches then filling in the gaps that were not considered in the beginning. Feedbacks from customers and partners could be the most valuable data sources for sustainable changes and following up current trends on the market. Extensive data gathering and analysis, flexibility and learning has a direct impact to the performance. The more internal and external sources engaged into the flexible management and decision making process, the better performance and customer value it could bring. Nowadays, customer is placed in the center of the most of successful businesses. The level of understanding of the customer preferences and values turning to solid insights that could help for better and more efficient performance and decision making processes. Co-created value with customer‟s insights will help to achieve more recognition, exclusivity and appreciation from customers. Direct interactions with wealthy individuals are the main differentiators and value creation mechanisms of a hyper luxury segment of watches. There are numerous opportunities to engage customers in a dialogue instead of traditional for Swiss luxury watchmaking industry one-directional communication. Largely applied in other industries (luxury cars, yachts etc.) this approach is considered to be a niche in the luxury watchmaking. Thus, in our opinion even in the highly traditional industry as Swiss luxury watchmaking it is of great importance to understand and try to implement this dynamic approach and to adopt “Bottom up” management practices. From managerial point of view it is important to encourage curiosity, open-mindedness and cross-departmental communication of the employees. Our key managerial recommendation would be to state that in order to gain competitive advantage, information from the markets, partners and clients should be translated into actionable plans that, once applied, tend to yield concrete results. This transition from data to reconfiguration of processes represents the path that creates more value and competitive advantage in a highly competitive industry. More specifically, firms aimed to compete on the basis of the superior customer service and expansion to the “hyper luxury” sector are advised to invest into building new type of relationship and more dynamic organizational process based on the insights coming from various partners. Limitations and further research avenues The resource advantage theory was predominantly constructed on the theoretical level. In our opinion, such approach could be considered as the key drawback of scientific discourse. Recognition that science and practice produce distinct forms of knowledge has been longstanding. According to Van de Ven (2007), the gap between theory and practice may be a knowledge production problem. The aim of the current research is to suggest a vice versa point of view and to highlight empirical evidence coming from practice. The theoretical contribution of this article to the academic discussion lies in explaining the expansion to the Hyper Luxury Watchmaking Segment based on intangible assets management. We contribute to the development of RBT with its insights deriving from Swiss luxury watchmaking industry. These issues helps us to come up with managerial recommendations and thus to contribute to the advancement of the RBT. The main limitation of this research is in the nature of our research. The exploratory research helped us to identify the key elements in expansion to hyper luxury watch segment by Swiss luxury watchmaking companies. However, this does not allow us to understand the depth of this phenomenon. In order to confirm this results the more profound and focused analysis is needed. It could help to understand deeper micro-foundations of DMC. In addition to that, in our opinion a detailed case study of the firm with outstanding DMC‟s would be particularly valuable. Otherwise, to test quantitatively what are the links between various elements is also a promising avenue for this research.

Introduction This research will investigate the advancement of cognitive computing and how it can be applied through „Dynamic Marketing Capabilities‟ (Bruni and Verona, 2009) to raise the bar of personalizing services and amenities provided to the luxury watch market loyal customer. Through intuitive digital applications, new levels of interactive systems can focus on explicitly the next generation of hyper-connected luxury customers. Theoretical Development The purpose of this research is to investigate how to personalize the communication process in the luxury market segment through cognitive computing and address the high expectation of the new affluent consumer of the digital age. The next generation of affluent luxury consumers is accustomed to interactive systems and personalized interfaces that enable computers to get more intuitive of the customer(s) to enable them to personal the individual‟s needs. This level of personalization undoubtedly raises the bar on the luxury customer‟s journey from the tactile in-person luxury shopping experience currently found in brick-and-mortar locations, to a decidedly more interactive and increasingly immersive online customer experience. Abbott (1955) and Alderson (1957) focused on the notion that “what people desire are not products but satisfying experiences” (Abbot 1955, p. 40). The fundamentals of cognitive computing are to recognizing trends and behaviors that enable companies to utilize Artificial Intelligence to make proper predictions and give insight to intuitively give consumers what they need before they have to request it. The idea behind this research is to take the traditional luxury market sector of Swiss watches and combine it with the intuitive software provided by cognitive computing. Research Design According to the Federation of the Swiss Watch Industry (FHS) in 2017, Switzerland occupies only 3% of the global market regarding the quantity of watches. As for value, Switzerland represents 54% of global sales that is 21 billion USD. Thus, about 95% of luxury watches with price starting from 1,000 USD are stamped "Swiss Made.” Thus, the Swiss watch industry has become an integral part of the luxury universe. However, it‟s not an easy task to get a place in this luxury market of reference. According to the estimation made by the Institute of Watch Marketing, there are approximately 200 active Swiss independent watch brands on the market today. Under conditions of the highly competitive market, the challenge concerns not only market share, but also competitive advantage as well as customer relationships or brand equity. We situate this research within the context of the Swiss luxury watchmaking industry and focus on the power of the website to increase customer loyalty. We suggest ways to utilize a brand‟s electronic (desk, mobile, tablet) touch points to aggregate data to gain a deeper understanding of their loyalist. Armed with knowledge, luxury watch brands can connect to their customers through the power of artificial intelligence. Affluent “digital native” consumers have “hyper-connected” instincts, and increasingly expect more from their chosen brands through next-level personalization. The continued evolution of consumers‟ online behavior, attitude, and expectations from brands currently exceeds what is possible for a single human to process. It is, therefore, becoming increasingly necessary to incorporate both the power of cognitive computing and the information gleaned from large data sets (big data) to produce more intuitive and personalized experiences. This information enhances the brand‟s ability to uncover behavioral patterns and begin to incorporate “machine learning,” (a subset of AI) a calculated algorithm that can facilitate the process of personalization. The speed at which data can now be processed, analyzed, clustered and contextualized has increased the value of machine learning in the world of the consumer experience. Personalization of luxury branded communication that utilize artificial intelligence (AI) to help them connect intuitively with their audience are more apt to meet the needs of the next generation of affluent consumers on a more personalized level. By focusing on the shift in adaptive interactive systems, we highlight the power of cognitive computing to help offer more intuitive luxury personalization for their loyal customers (owners of the brand‟s watches). Achieving this stage of customization requires computers to mimic human intelligence using logic and insight. This research will explore new opportunities to help identify the independent luxury watch industry to capture the attention of the next generation of customers in cyber-space. The customer‟s journey no longer ends at the front door of the traditional brick-andmortar location – it continues into the digital space and even starts from it. Offline Swiss luxury watch brands have mastered the role of personalization through “white glove” in-person customer service and installations exhibiting their expert craftsmanship. This level of customer service is still best accomplished through cultivating and curating the boutique shopping experience, although AI is rapidly changing this dynamic. Currently, the online experiences of luxury watch brands have proven to be less than satisfying for their discriminating clientele because most still shy away from creating a fully-realized digital landscape including an e-commerce presence. Independent watch brands need to push beyond the generic expectations and curate rich aesthetic experiences that set a crucial dimension of the luxury sector (Berthon et al. 2009). This research begins to address how Swiss luxury watch brands can fully embrace the digital evolution and strategically utilize the valued subset of AI including cognitive computing, machine learning, and adaptive interactive systems. AI machine learning will ensure the level of personalization to which the discerning luxury customer has grown accustomed. The next section details how watchmakers can accomplish this integration. Conceptual Framework Over the past years, researchers have increased conceptual understanding of the role of marketing in enabling firms to create and sustain competitive advantage and superior value (Ramaswami et al., 2009). By potential to improve business performance, some studies (Bruni and Verona, 2009), have introduced the term „Dynamic Marketing Capabilities‟ (DMCs hereafter). In fact, DMCs are focused explicitly on releasing and integrating the market knowledge that helps firms evolve. The strategic position of marketing to absorb market knowledge allows Swiss luxury watch brands to provide accurate insight into brand equity and distinctive experience. DMCs are capabilities that use market knowledge to adapt firms‟ resources and capabilities (Day, 1994; Slater and Naver, 1998). In this research will explore the characteristics and uses of market-based resources, such as building brands, relationships, and knowledge and apply to digital solutions through interactive systems and personalized interfaces. This market-based perspective suggests that marketing research increasingly focuses on intangible, complementary resources, whose effects on the firm‟s sustained competitive advantage (SCA) and performance may be greater than the impact of tangible resources (Srivastava et al.1998). As much as 70% of a firm‟s market value may come from its intangible resources (Capraro and Srivastava 1997), and organizational performance increasingly seems tied to intangible resources, such as customer relationships or brand equity (Lusch and Harvey 1994). The abundance of active users globally on the internet, smartphones, laptops, tablets, and desktops creates a wealth of data, up to 80 percent of which is untapped and unstructured and not contextualized for use (Alexander, 2016). This unused data often referred to as “dark data,” includes web images, social media networks, emails, blogs, and videos (Alexander, 2016). An analysis of the online behavior of a brand‟s current customers contributes to the formation of stronger, more meaningful clusters based on current customer personas to reveal patterns of similar interests between groups of customers. This majority of available data can be analyzed by machine learning, and “the more data an algorithm can train on, the more accurate it will be” (Deep Learning, n/a). The sub-domain of machine learning, deep learning, which is itself a sub-domain of AI, breaks down tasks to make machine assistance possible (Copeland, 2016). Thus, deep learning provides insights, which can then be used to help curate a personalized experience through predictive analytics. Gathering customer attributes through insight for this research requires that we take a closer look at similar customer gathering registering their watches online (serial number required) making sure to capture necessary demographic and psychographic information, and through using clientele retail locations, which would then was mined for insights and more branded content. The reactive software would utilize deep learning algorithms to recognize moments, behavior and geo-location to offer realtime personalized mobile engagement. The increasingly common practice of merging of marketing teams enhances marketing deliverables through the User Interface (UI) and User Experience (UX). The interface, coupled with the experience, need to work synergistically to drive curiosity and encourage the user to explore and discover what will eventually become more personally-targeted curated content on the website. To further explain how these technologies can be employed for the luxury watchmaking companies, we examine several Swiss luxury watch brands. Describing how actionable data derived from cognitive computing can create a more intuitive customer experience, Vishal Katelia, Senior Manager, Global CRM at the luxury ecommerce website Mr. Porter provides an analogy from the luxury hotel world. He says that luxury hotels excel in many ways, “especially around the „surprise and delight‟ aspect of keeping track of small but important details that personalize their clientele‟s experience from the type of pillow they prefer to sleep on. Paying attention to these details can ensure future expertise, are as perfect as the hotel can offer (Miller, 2016). While machine learning focuses on building machines that replicate the human brain‟s cognitive capabilities to apply this knowledge from cognitive science to react in a intuitive way (Jones, 2017). Artificial intelligence refers to "a broad set of methods, algorithms and technologies that make software 'smart' in a way that may seem human-like to an outside observer," according to Lynne Parker, director of the division of Information and Intelligent Systems for the National Science Foundation (Noyes, K., 2016). Cognitive technologies are themselves products of artificial intelligence that perform human-like tasks such as speech recognition, natural language process, machine learning, computer vision (Schatsky D., Muraskin, Ragu Gurumurthy, R. 2015). Furthermore, it is important to look beyond AI to the most efficient way to personalize the customer‟s experience. By using cognitive technologies marketers can create intuitive experiences for customers offering services and experiences based on behavioral profiling through data clusters and affinity analysis. Result The actionable insight that can be gained through this research was presented in a two-pronged process. First, connecting data that would typically be collected from a brand‟ e-commerce customers‟ journey now would be used to produce more curated content. The ability to apply cognitive computing through tools such as Qubit (data science company) that was used for this study that offers gives us the opportunity to apply an affinity analysis to form insights, patterns, behaviors that previously were undiscovered. Insights gathered would help to identify and reward loyal customers beyond the standard loyalty programs with notifications, private activations on geolocation services. Second, understanding the UX and UI on the websites of the three pre-selected independent luxury watch brands enabled us to follow and eventually understand the user‟s journey both on mobile and desktop. The personalization of the interface allows for in-depth learning to better understand an individual‟s needs and create an intuitive experience for the user. This research is limited to the personalization of loyal users, not to the interested parties of the independent luxury watch brands. While for marketing purposes, most insight collected from a brand‟s website typically is obtained from e-commerce, the independent luxury watch brands are currently limited to UX to measure the movement and interests of the users. The practical application of utilizing untapped „dark data‟ through the process of deep learning personalizes the interface and further utilizing AI technology to offer unique immersive experiences raises the innovation of personalization. The behavioral insights provided by deep learning can contextualize actionable information, which can then be applied by the brand‟s marketing management, retail managers, digital marketing, and public relations (PR) teams. Collection Process & Insight 1. Discovery of Audience Clusters based on Interests 2. Selection Process of Interest-Sets 3. Profiling / Persona of Audience 4. Discovery patterns from AI‟s Subset of Deep Learning 5. Select Deliverables That Align with Brand Through Mobile Applications Further investigation and re-evaluation of changing audience should be measured through the new applied data collected from discovering of new AI subset of deep learning from the luxury consumer. The AI movement will continue to change the next generation of affluent consumer‟s expectations, and with a continued reliance on smartphone technology it is inevitable that the future of personalization will require further investigation. While we have specifically focused on these three independent luxury watchmakers and the four clusters of interests currently available on their websites, future research will need to more deeply examine how the continued evolution of deep learning measurements can be best utilized to match the organic interests of the next generation of loyal customers. The behavioral insights provided by deep learning can contextualize actionable information, which can then be applied throughout the luxury brand communication; marketing management, retail managers, digital marketing, and public relations (PR) teams. Conclusion In this paper, we aimed to revisit luxury customer‟s expectation in the digital age and discuss how the industry is in the midst of a revolution that is changing the level of expectations of personalization. There is no doubt that the new technology is shifting the levels of customization through interactive systems and personalized interface will continue to advance. The next generation of affluent consumers have a high demand for interactive visual content, and dynamic marketing capabilities concept helps to integrate data for creating the new value and competitive advantage for the company. Cognitive computing insight will continue to enable luxury Swiss watches makers to understand how to personalize for the next generation of affluent consumers; more research is required to continue to explore more actionable insight.

This paper explores how luxury brands can utilize Weibo in order to create an effective marketing strategy that appeals to millenials. China accounts for 47% of global online retail sales (eMarketer, 2016) and it is predicted that millenials (born 1980-1995) and Generation Z will make up two-fifths of luxury spending by 2025 (eMarketer, 2017). However, due to political constraints, popular western social media sites cannot be used to target this vast market of online Chinese consumers. Weibo is one of the most popular social media sites in China, with 97.2% using the site (Yu et al., 2017). In order to target them effectively brands need to gain an indepth understanding of Chinese consumers and what would appeal to them on Weibo. The majority of social media research uses quantitative methodologies on popular social media, such as Facebook and Twitter. There are limited qualitative studies exploring consumers’ feelings and attitudes towards brands’ social media activities on Weibo. Due to different cultural backgrounds Chinese consumer behavior is likely to show a different trend to Western countries. Semi-structured interviews with a purposive sample of 12 participants were conducted. Findings showed that convenience, immediacy, social standing/status and entertainment were key drivers for using Weibo. Fashion information, latest product releases and videos were the most popular type of posts. Consumers read comments and tagged their friends, emphasising the importance of e-word-of-mouth (e-wom) and the influence that it can have on purchasing behaviour. This also facilitated the creation and feeling of a brand community. Consumers were very receptive to celebrity collaborations which influenced purchasing behavior. The main criticism of luxury brand’s Weibo was that it was not updated enough and Weibo did not have an influence on trust. This study provides a clear insight into what Chinese millenials want from luxury brands’ Weibo and how it can influence their purchasing behaviors and e-wom. The findings are novel, contributing to the academic literature through the conduction of a qualitative study exploring an under-researched area. This research has practical implications for luxury brands, as they should provide regular, up-to-date content consisting of videos and celebrity collaborations. A limitation could be the limited number of participants, yet, findings provide an interesting insight into consumers’ perceptions of Weibo and how it influences their attitudes and behaviors towards luxury brands.

The aim of this exploratory research is to investigate whether luxury brands social media activities (Kim & Ko, 2012) – which are online activities that could potentially engage customers in digital environment (Sashi, 2012) – are capable of transmitting the sense of heritage of such brands to the customers. Moreover, the authors will observe whether the aforementioned activities are capable of transmitting the sense of exclusivity, which will be measured through the customers’ perceptions of the brand prestige (Hwang & Hyun, 2012), to the latter. In order to explore such a phenomenon, the authors have selected structural eqation modeling (SEM) as the main methodology of the research (Bagozzi & Yi, 1988). The theoretical foundations of the present research are related with three streams of marketing literature, namely (1) luxury brands social media marketing activities (Kim & Ko, 2010; Kim & Ko, 2012), (2) luxury brands heritage (Ciappei, Zollo, Boccardi, & Rialti, 2016; Hudson, 2011; Rialti, Zollo, Boccardi, & Marzi, 2016) and, finally, (3) luxury brands customer-based prestige (Napoli, Dickinson, Beverland, & Farrelly, 2014). In particular, building on the concept of social media marketing activities (Kim & Ko, 2010), we aimed at observing how the latter could influence customers’ perceptions of the brand by engaging them in online activities and conversations (Sashi, 2012; Zaglia, 2013). Specifically, we investigated if engagement in online activities or in online communities is related with a positive perception of luxury brands’ heritage and prestige. Hence, customers’ online engagement deriving from social media activities has been considered as an antecedent of customer perceived heritage and prestige (Phan, Thomas, & Heine, 2011; Hamzah, Alwi, & Othman, 2014; Riviezzo Garofano, & Napolitano, 2016). Luxury brands have been selected as the context of research since heritage and prestige have emerged as relevant strategic marketing levers for luxury brands’ brand strategist. As a proof of that, recently, luxury brands’ strategist and product managers are increasingly focusing brands’ strategies on the history of the brands in order to transmit customers a feeling of exclusivity and elitism (Hudson, 2010; Balmer, 2011). Thus, luxury brands heritage perceived by costumers emerged as a fundamental component of brand identity and, in addition, it may be considered as a form of competitive advantage increasing brand equity (Van Riel & Balmer, 1997). The main findings of the present research are related with the fact that social media marketing activities may engage customers online (Sashi, 2012). Moreover, it emerged how social media strategies are capable to engage customers and transmit them the sense of heritage and prestige. Hence, social media marketing strategies focused on developing a relationship with customers emerged as crucial in order to enhance customers’ perceptions of a brand heritage and prestige. Finally, the development of such a kind of social media marketing strategies is the principal implication for marketing managers. Due to the aforementioned results, this exploratory research contributes to online luxury brand management literature (Kim & Ko, 2010). In particular, due to our results it is possible to assess that social media activities, which are capable to engage customers online, are able to transmit the sense of heritage and of prestige. Future researches should explore better this phenomenon. In particular, on the one hand we suggest scholars to investigate through qualitative methodologies which kind of communications are capable to transmit sense of heritage and prestige. On the other hand, we suggest scholars to compare traditional form of communications with online form in order to understand which one is more capable to influence customers’ perceptions. The principal limitation of this research is related with its exploratory nature and with the traditional limitations of SEM methodology.

As a contemporary, postmodern marketing strategy, digital storytelling is the virtual means by which a story can be organized. Less traditional than a conventional beginning, middle, and end narrative, the genre suggests that individuals connect the dots of a story by comparing their reading with others. This research examines Christian Dior’s Secret Garden IV campaign film as it is broadcasted on YouTube for six weeks and diffused through Instagram. Through a grounded theory approach we measure and analyze audience engagement and key themes expressed through user-generated content on YouTube and Instagram. Manual coding and three computer-aided text analysis programs are used to analyze the data and triangulate results. This research contributes to the literature on consumer engagement in digital storytelling, online brand communities, and celebrity endorsement. Introduction Digital technologies have improved the aesthetics of content creation, enabling brands to develop deeper levels of engagement with consumers through social channels (Merrilees, 2016). Every day hundreds of millions of hours of video are consumed on YouTube and the number of high performing channels has been increasing by 50% per year (YouTube, 2017). Instagram’s monthly active users have grown from 300 million in December 2014 to 600 million in December 2016 (Statista, 2017). Within the social media sphere, commercial and individual users connect through multiple platforms and devices to share ideas and information without the constraint of time and space (Gruzd & Wellman, 2014). The digitization of visual culture provides users with so much content that it may even result in information overload (Babin et al., 2017). This research focuses on the fashion sector and social media platforms that cater specifically to visual imagery and video content. The logic is twofold: the fashion industry is inherently visual and research on a study of eighty-three fashion brands indicates a shift from traditional advertising to video products, especially on social media (L2 Inc., 2016). We examine elements of French luxury goods company, Christian Dior’s Secret Garden omni-channel marketing campaign. As a collection of short films shown on YouTube and in other media, the campaign had four annual installments beginning in 2012. The Secret Garden series explores the brand’s past and present within the context of the 21st century Palace of Versailles. Our focus is on Secret Garden IV, launched in May 2015, featuring singer/songwriter Rihanna as the protagonist. Dior’s portrayal of Versailles throughout the Secret Garden series reflects undertones of its monarchial heritage and its high fashion prestige. In Secret Garden IV, there is a juxtaposition to this theme when Rihanna’s subculture persona and celebrity status (Fleetwood, 2012) presents a misalignment between luxury ideals and Rihanna’s position in popular culture. Table 1 provides an overview of the history of the campaign. This research measures and analyzes audience engagement and key themes expressed through users’ comments on YouTube and Instagram for the pre-launch and launch of the Secret Garden IV campaign. Through a grounded theory approach we identify, analyze, and validate keywords and group them into themes utilizing both manual coding and computer-aided text analysis (Lai & To, 2015). We utilize three software programs (Tableau, NVivo 11, and Leximancer) to triangulate results. The scholarly literature on fashion luxury goods is scant and this methodological approach is sound (Neuendorf, 2017). Five recent scholarly articles on luxury fashion goods and social media were identified. One relates to storytelling and is visually-focused (Megehee & Spake, 2012); three develop models (Kim & Ko, 2010; Kim & Ko, 2012; Brogi et al., 2013); and one uses the case study approach (Phan et al., 2011). This research fills both a theoretical and a methodological gap. We examine a digital storytelling campaign across social media platforms with the prospect of new theoretical insights. According to Snelson (2016) there is scant social media research on YouTube and Instagram and social media research using a grounded theory approach is also limited. Theoretical background Digital Storytelling Digital storytelling uses technology as an extension of oral and written stories “…to solidify our cultures and share knowledge for the future” (Irwin, 2014, p. 40), placing engagement with digital media as an extension of the self. People naturally think in narratives and stories, rather than arguments and paradigms (Megehee & Spake, 2012) and may use digital storytelling to order otherwise disconnected experiences into interrelated, meaningful episodes (Vannini, 2012). By connecting the dots of a story on social media users have the opportunity to formulate meanings of their own and build interpretations by comparing their “reading” with that of others. Social media has empowered the consumer by enabling communication that is multi-way, multi-directional, and led by the consumer (Tuten & Solomon, 2015). The fashion film on the internet has been viewed as “a genre that is not is not simply a tool to stimulate consumption, but is something that is set to change our notion of fashion as a moment in time” (Khan, 2012, p. 236). In her review, “100 Years of the Fashion Film,” Marketa Uhlirova posits that contemporary technologies aimed at a film’s “potential to promote fashion” turned into “the medium’s ability to recast consumption as seductive visual entertainment,” devaluing a fashion film’s potential for not only entertainment and visual pleasure, but also for experimentation and innovation (Uhlirova, 2013, p. 140; p. 153). Online Brand Communities As a hub of value creation in the consumer marketplace, brand communities are an enthusiastic, passionate group of customers who express similar commitment towards a brand or product and may not be geographically bound (Muniz Jr. & O’Guinn, 2001; McAlexander et al., 2002). In brand communities created by marketers, organizations may stimulate engagement, brand loyalty and the expression of positive emotions and trust (Bagozzi & Dholakia, 2006; Jung et al., 2014). Customer engagement behaviour pertains to a variety of online and offline behaviours (e.g. word of mouth, blogging, customer reviews) that are not transactional, but can be measured (Verhoef et al., 2010). Although positive word of mouth and brand advocacy are not guaranteed, an organization’s most engaged social customers have the potential to communicate messages that are perceived as more credible than those generated by the organization (Kozinets et al., 2010). A high level of engagement may be described as delight or joy. Engagement requires strong emotional and relational bonds (commitment and trust), and may transform customers into loyal “fans” or co-creators of value (Hawkins & Davis, 2012). A study of customer engagement behaviour in a social media environment is complex because engagement behaviour in different channels may vary considerably, with a different effect on value creation or purchase intent. For example, if a customer tweets on a mobile device his/her engagement and purchase intent may differ from engagement and purchase intent as a result of interaction with a video or blog (Libai et al., 2010). Celebrity Endorsement A celebrity endorsement is defined as “an agreement between an individual who enjoys public recognition (a celebrity) and an entity (e.g., a brand) to use the celebrity for the purpose of promoting the entity” (Bergkvist & Zhou, 2016). Celebrity endorsements previously were associated primarily with consumer goods and services advertised through traditional media, such as print and television. More recently, these endorsements encompass any mode of communication as well as business-to-business goods and services. This update is significant considering the addition of advertising on the Internet, in social media, “stealth marketing” on TV talk shows (Kaikati & Kaikati, 2004) and red carpet appearances (Carroll, 2009). Theories related to celebrity persuasion that have application to the fashion industry have examined the way consumers process information from marketing communications and relate it to their self-concept (Carroll, 2009). To the consumer, the celebrity represents a meaning, based on the recognition s/he has received in the symbolic environment and his/her persona. This meaning is transferred to the product when the celebrity is seen in the marketing communication. In the final stage, the meaning moves from the product to the consumer, who transfers the meaning into his/her notion of the self-concept (Carroll, 2009). This transference effect benefits the brand (Tuten & Solomon, 2015) and the consumer who may use products to reveal their self-concept to others (Babin, et al., 2017), especially in high involvement consumption situations (Ahuvia, 2005). Method Sample Instagram and YouTube data were collected using Netlytic (Gruzd, 2016) for the period May 14 – June 24, 2015 for the purpose of capturing data before and after the official release of the film (May 18, 2015). A total of 8,986 records (uncleansed) are in the Instagram (#SecretGarden4 and @Dior) database and 426 records (uncleansed) in the YouTube database. Multiple URLs were used for YouTube because there were four previews, and short and long versions of the film. Procedures The data was cleansed (236 YouTube posts; 6,763 Instagram posts). To measure sentiment and engagement, a text analysis was performed using an adaptation of Dann’s Twitter (2010) classification. Through a grounded theory approach (Lai & To, 2015) key words, concepts and themes were identified and triangulated using Tableau, NVivo 11, and Leximancer software programs. Concluding Remarks As a multi-year campaign, Dior’s Secret Garden was meticulously crafted to project an understanding of Dior’s brand image and to create an air of anticipation for consumers. Within the context of digital storytelling we delve deeply into how the last installment of this campaign resonated with consumers who watched the film on social media and responded to Dior’s Instagram initiatives. Through our mixed methods research approach, we develop theoretical and methodological contributions that benefit academics and fashion marketers.

Luxury brands are explicitly marketed to appear rare, exclusive, prestigious, and authentic (Phau & Prendergast, 2000; Turunen & Laaksonen, 2011; Tynan, McKechnie, & Chhuon, 2010). The glamour and distinction that these brands generate appeal to consumers’ desire to signal their accomplishments, success, or social superiority (Mandel, Petrova, & Cialdini, 2006; McFerran, Aquino, & Tracy, 2014). It is, therefore, unsurprising that the marketing communication of many luxury brands explicitly portray images of successful, sophisticated, and confident people expressing their social superiority. However, the empirical evidence supporting the effectiveness of such portrayal in luxury communication is scant. Only a pilot study showed that exposure to a story of a similar successful other may increase desire for luxury goods (Mandel et al., 2006). In the present research, we propose that envy is a key determinant of how consumers perceive display of pride and social superiority. Our findings from two studies showed that benign (malicious) envy predisposes consumers to perceive portrayal of social superiority on luxury marketing communication to be an expression of authentic (hubristic) pride. This relationship between benign (malicious) envy and authentic (hubristic) pride enhances (reduces) the luxury perception and positive brand attitude toward the luxury brand in the advertisement. These findings were replicated in a correlational study on genuine advertisements (Study 1) and an experiment that successfully manipulated consumers’ experience of benign envy (Study 2). Separate studies have recently shown that experience of benign envy can increase consumers’ willingness to pay toward the envied product (Van de Ven et al., 2011) and that the experience of authentic pride increases luxury consumption (McFerran et al., 2014). However, no existing research has explored the complementary effect of envy and pride on consumers’ response toward luxury marketing communication. The current research is therefore the first to demonstrate the differential effect of benign and malicious envy on: (1) consumers’ interpretation of social superiority as an expression of authentic and hubristic pride; (2) consumers’ response toward the portrayal of social superiority in luxury marketing; and (3) how portrayal of social superiority enhances or reduces luxury perception and brand attitude of a luxury brand. These findings also provide insights into the complementary relationship between envy and pride in consumer psychology. Lange and Crusius (2015) suggested that other’s authentic and hubristic pride expression may evoke the experience of benign and malicious envy, respectively. The current research, however, shows that the Luxury brands are explicitly marketed to appear rare, exclusive, prestigious, and authentic (Phau & Prendergast, 2000; Turunen & Laaksonen, 2011; Tynan, McKechnie, & Chhuon, 2010). The glamour and distinction that these brands generate appeal to consumers’ desire to signal their accomplishments, success, or social superiority (Mandel, Petrova, & Cialdini, 2006; McFerran, Aquino, & Tracy, 2014). It is, therefore, unsurprising that the marketing communication of many luxury brands explicitly portray images of successful, sophisticated, and confident people expressing their social superiority. However, the empirical evidence supporting the effectiveness of such portrayal in luxury communication is scant. Only a pilot study showed that exposure to a story of a similar successful other may increase desire for luxury goods (Mandel et al., 2006). In the present research, we propose that envy is a key determinant of how consumers perceive display of pride and social superiority. Our findings from two studies showed that benign (malicious) envy predisposes consumers to perceive portrayal of social superiority on luxury marketing communication to be an expression of authentic (hubristic) pride. This relationship between benign (malicious) envy and authentic (hubristic) pride enhances (reduces) the luxury perception and positive brand attitude toward the luxury brand in the advertisement. These findings were replicated in a correlational study on genuine advertisements (Study 1) and an experiment that successfully manipulated consumers’ experience of benign envy (Study 2). Separate studies have recently shown that experience of benign envy can increase consumers’ willingness to pay toward the envied product (Van de Ven et al., 2011) and that the experience of authentic pride increases luxury consumption (McFerran et al., 2014). However, no existing research has explored the complementary effect of envy and pride on consumers’ response toward luxury marketing communication. The current research is therefore the first to demonstrate the differential effect of benign and malicious envy on: (1) consumers’ interpretation of social superiority as an expression of authentic and hubristic pride; (2) consumers’ response toward the portrayal of social superiority in luxury marketing; and (3) how portrayal of social superiority enhances or reduces luxury perception and brand attitude of a luxury brand. These findings also provide insights into the complementary relationship between envy and pride in consumer psychology. Lange and Crusius (2015) suggested that other’s authentic and hubristic pride expression may evoke the experience of benign and malicious envy, respectively. The current research, however, shows that the

This study explores the role of corporate involvement and brand perception in moderating the Cause Related Marketing on consumer purchase intention in the luxury product category among Japanese consumers. This research examines three core cause attributes - cause scope, cause type and cause acuteness developed by Vanhamme, Lindgree, Reast and van Popering (2012) as well as an additional component of duration – with corporate involvement and brand perception moderating the effect on purchase intention. The general public places judgment on a corporation based on how much of positive or negative impacts its business has on environment or society (Sheikh & Beise-Zee, 2011). In fact, more corporations have been developing corporate social responsibility (CSR) programs, no matter how big their business sizes, big or small, are (Brinkvan, Odekerken-Schroder, & Pauwels, 2006). The general public loses its faith in corporations, especially after a financial crisis or malfeasances of big corporations and as a result, corporations are under stronger pressure to contribute to environmental or societal causes in order to reclaim lost faith from the general public (Sheikh & Beise-Zee, 2011; Berglind & Nakata, 2005). One way corporations contribute to society has been to employ marketing strategies that link product sales to the support of specific charities to create and maintain favorable brand images known as cause related marketing or CRM. CRM has been growing faster as a type of marketing that allow corporations to contribute to environment or society (Brinkvan et al., 2006). Various factors have been extensively researched on and identified as pertinent in the success of cause-related marketing campaigns such as brand-cause fit (Bigne-Alcanniz, Currase-Perez, Ruiz-Mafe and Sanz-Blas, 2011; Nan and Heo, 2007; Samu and Wymer, 2009), donation size (Dahl and Labvack, 1995; Pracejus, Olsen and Brown, 2003), types of causes (local causes are preferred to national ones) (Ellen, Mohr, and Webb, 1996; Smith and Alcorn, 1991) and product type with luxury products found to be more effective (Strahilevitz and Myers, 1995).

The Internet is providing companies with an opportunity to market their goods more widely than has been the case in the past. This is having implications for senior managers as it means that some luxury goods are being made available to a wider market segment than previously and also, there are issues as regards authenticity and counterfeiting for example. Cultural value systems underpin psychological needs which are taken into account when advertising a brand and in addition, marketers are keen to build a relationship with customers, which takes into account the customers’ psychological aspirations. Meeting consumer expectations is crucial in the luxury sector because of the value placed on uniqueness and the price-quality dynamic. Bearing these points in mind, the research question to be addressed in this paper is: How can marketers utilize the Elaboration Likelihood Model (Petty & Cacioppo 1984 & 1986) in order to maintain the quality of the luxury brand and develop a relationship with high net worth individuals while marketing the product online? The aim of the paper is to explain how marketers can develop a better understanding of how the Elaboration Likelihood Model (Petty & Cacioppo 1984 & 1986) can be utilized to develop theoretical insights into promoting luxury goods online. Bearing this in mind, two research objectives were formed: (i) to explain how the Elaboration Likelihood Model can be used to formulate international luxury brand strategies; and (ii) to provide guidance as to how marketers can develop a better understanding of marketing luxury products online. The study will build on the work of Hennessey and Anderson (1990), as it will explain how involvement affects motivation vis-à-vis luxury brands. By studying luxury brands, the Internet, and social psychology, it should be possible for marketers to provide marketing practitioners with relevant theoretical insights into how marketing theory is evolving and is applied in practice. The Elaboration Likelihood Model represents “a fairly general framework for organizing, categorizing, and understanding the basis processes underlying the effectiveness of persuasive communications” (Petty & Cacioppo, 1986, p.125) and proves ideal with respect to researching cultural value systems. The Elaboration Likelihood Model allows academic researchers to look into and comprehend cognitive processing (Cacipppo, Harkins, & Petty, 1981, p.37). The main strength of the Elaboration Likelihood Model is that the variables that can impact certain judgements are made clear and in addition, the processes underlyingchanges in attitude are made known and so too are the resulting judgements (Petty, Rucker, Bizer, & Cacioppo, 2004, pp.66-67). The Elaboration Likelihood Model has been extensively used by marketing academics and has relevance in terms of how people formulate a systematic information processing strategy (De Meulenaer, Dens, & De Pelsmacker, 2015, p.610). Marketers are concerned about the price-quality dynamic and also the trust construct (Shu-Chen, Wanchiao, Sung, & Cheng-Kiang, 2006) and risk (Park, Lennon, & Stoel, 2005) vis-à-vis buying online. Furthermore, how online consumers interpret signals has been given attention (San Martin, Camarero & San Jose, 2011) and according to Areni (2003), argument-driven persuasion is important and will be given attention in the study. Attention will be given to luxury branding, the development of an international brand strategy and how marketers can protect a luxury brand through a marketing intelligence strategy that counteracts counterfeiting. As well as utilizing data collected via a group interview, reference will be made to data collected over a three year period using a survey instrument. The Elaboration Likelihood Model (Petty & Cacioppo 1984 & 1986) will be used as a basis for providing a framework for understanding how a luxury brand can be perceived and protected, and the research outcome will be used by marketers to advise senior management about the need for implementing an integrated international luxury brand strategy. For example, research has been undertaken into the relevance of the construct trustworthiness and it is important to note that “trustworthiness is an attribute of individual exchange partners” (Barney and Hansen, 1994, p.176). This is an important observation because the producers of luxury goods depend on a number of external specialists (eg., designers, communication and public relations advisors, and manufacturers of specialist components) in order to help the company to add value to the product/service and make sure that it is viewed as unique. Marketers employed by a luxury goods producer need to ensure that data and information relating to the product offering is well guarded because they need to have confidence in the fact that there are no vulnerabilities in existence. A vulnerability could result in leakage of sensitive data and information (e.g., a new design) and result in a loss in intellectual property and ultimately brand piracy and reputational damage. By failing to identify potential vulnerabilities and deal with them through adequate counter threat measures, it is likely that it will take several years and require a repositioning and a rebranding strategy to recover the brand in the market. What we are advocating is a marketing counterintelligence strategy that is aimed at reinforcing the need and usefulness of security to protect the brand and ensure that the brand is not diluted in any way. Another reason as to why marketers need to engage in risk management is because there are a number of country-of-origin issues that arise and need to be addressed. Balabanis and Diamantopoulos (2011) have indicated that consumers are not always able to link a brand correctly with its country-of-origin and this may prove problematic. This is linked with brand image perceptions and again the Elaboration Likelihood Model can help to provide evidence that is used by marketers to overcome consumer misperceptions. Reflecting on the fact that marketers are confronted with legitimate competition (products and services compete in adherence with regulatory processes) as well asillegal forms of competition, it can also be argued that marketers need to be aware of and embrace the standards that govern the production of the product/service to the quality specified. Thus, senior management need to ensure that employees lower down the organizational hierarchy are committed to maintaining the standards that are in being (Ghoshal and Bartlett, 1994, p.96). Ghoshal and Bartlett (1994, p.98 and pp.106-107) add to our understanding by suggesting that marketers need also to have a shared ambition and participate in a collective decision-making, which relies upon collective learning. The logic of this view manifests in the fact that the Elaboration Likelihood Model is used to reinforce and condition the views of the employees as well as the organization’s customers and because it has both an internal and an external dimension. Because marketers work closely with organizational strategists that are outward looking and intelligence driven, and liaise with R&D, technology and production staff that are inward looking and security driven, they are well able to contribute to the risk management process and advise on all the aspects of marketing strategy. The research undertaken will be placed within a strategic marketing context and the learning aspect will be drawn upon to show how marketers can link social psychology theory with marketing theory, and how risk communication can be used to reinforce the advertising message. The paper will explore the advertising-consumer perception dynamic and will examine how the Elaboration Likelihood Model (Petty & Cacioppo 1984 & 1986) can be used to promote the uniqueness of a luxury good to individual consumers who share and exchange information using social networks. The influence of social networks is growing and marketers need to be aware of how and why consumers share and exchange information as they do across geographical boundaries. In particular, it will build on the work of Michaelidou and Christodoulides (2011) by establishing how certain psychological factors influence attitudes towards counterfeited products and what marketers can do to counteract these attitudes. This will contribute to the literature because it will highlight both price related and ethical related issues associated with the purchasing of counterfeited goods. In addition, it will allow marketers to identify trends in customer buying behavior and build on the work of Jack and Powers (2013) relating to shopping behavior and consumer satisfaction. By understanding better the motivations of those that purchase luxury products, marketers will be better able to plan product offerings and formulate and implement promotional strategies.

In the framework of luxury marketing, counterfeits have been constructed as a constant threat – an irritating presence and a hostile intruder (Bian & Mouthinho, 2008; Keller, 2009). However, there now exists a minor but growing body of literature that has found counterfeits as potentially non-threatening or even beneficial for luxury brands (e.g., Barnett, 2005; Romani, Gistri & Pace, 2012). Building on this emerging stream of evidence, the goal of this conceptual paper is to explore how counterfeits act as advertising for luxury brands and how luxury brands could benefit from this. To understand the communicative potential of counterfeits, we construct our argument around Veblen’s (1899/1994) foundational notion of how the conspicuous consumption of luxury revolves around the creation of new styles by/for the elite consumers and the efforts of the masses to emulate them. In doing so, we differentiate the effects based on whether they contribute to the emergence of new luxury goods targeted to elite consumers or the diffusion of luxury to the masses. The emergence of luxury stems from the desire of elite consumers to distinguish themselves from the masses through conspicuous consumption (Veblen, 1899/1994). Counterfeits contribute to this phenomenon by accelerating the snob effect (Leibenstein, 1950) as counterfeits destroy snob premium of goods and drives elite consumers to seek new ways to distinguish themselves (Barnett, 2005). Counterfeits also accelerate the fashion cycle that luxury companies depend on (see also Sproles, 1981). They do so by induced obsolescence that destroys the status value of product designs when they are copied and by anchoring trends to design features that accelerate their diffusion and subsequent replacement (Raustiala & Sprigman, 2006; 2009). Another key component of conspicuous consumption relates to the diffusion of luxury to the greater public (Veblen, 1899/1994). Therein counterfeits can generate aspiration effect when non-elite consumers imitate elite consumers by consuming counterfeits and in so doing generate brand awareness and exposure among other non-elite consumers (Barnett, 2005; Shultz & Saporito, 1996) at early stages of diffusion. During latter stages of diffusion counterfeits can generate bandwagon effect (Leibenstein, 1950) as they confer the desirability of certain luxury goods and brands over others (Barnett, 2005;Bekir, El Harbi & Grolleau, 2008). Finally, counterfeits can generate herding effect as they signal which to consumers which goods are desirable and appreciated or ‘trendy’ at a certain point in time (De Castro, Balkin & Shepherd 2008).

Nearly 70% of the Swiss luxury watch market is represented by major groups, bringing together worldwide well-known brands. In order to stand out from concurrence and to get a place in this highly competitive market of reference, independent (often unknown) companies have to find other vectors of marketing differentiation.