Why Big Luxury Brands Don’t Spend Money on Advertising

Sometimes we don’t acknowledge that big luxury brands have never spent a dime on advertising, and yet they maintain their popularity. Business owners simply dream of the moment where they will reduce advertising costs and still keep sales the same, but unfortunately, that is almost impossible.

So how big brands do it?

Well, first of all, it is all about image and presentation. Secondly, most luxury brands offer expensive products that only people with a lot of money can afford. This means that their target audience is much narrower than an ordinary one. There was a statement from Lamborghini a few years ago, where they said that they do not spend any money on TV advertising since their customers usually don’t have enough time to sit and watch TV.

You cannot expect to see a gold plated Rolex watch to be advertised on TV. They need a much more focused audience that is capable of making that purchase, so it is not intelligent for them to market their ads on big screens like during the NFL Superbowl halftime break.

However, let’s see why big luxury brands avoid advertising.

1. Focusing on Experience and Quality

Can you imagine if you allocate all of your advertising resources to improving product quality and user experience? You will be able to build a more successful brand that has something to offer to their customers. That is why big brands like Rolls Royse or Zara avoid advertising, and instead, they spend all of their marketing money on product and customer experience improvement. As we said in the beginning, creating a luxury brand is all about image, and you cannot create something perfect if you don’t have enough quality.

1. PR Builds Trust and Educates People About Your Product

In order to make people talk about your brand, you need to have that wow factor. Big brands focus on PR marketing, where they want to create a discussion on specifically chosen networks about their brand. It is a great way to tell the story behind your brand and educate people about some of the unique features your product offers to customers. Things like magazines, radio shows, newspapers, and high-authority websites are perfect for creating your brand image.

1. Ads Don’t Usually go Viral

Even though we are living in digital times where many things can ignite and go viral through social media, the impact through news stories is far greater. For example, a published story about your brand will be picked up by others, which means they will be reprinting it, summarizing, reviewing, and linking back to the initial story. This will have a far more significant impact on your brand image, rather than a pointless ad, that does not spark any reaction.

1. Advertising is Expensive

Even though we are talking about luxury brands, it does not mean that they have unlimited resources at their disposal. It is still like a normal business where every cost can lower profitability. Also, advertising ROI for big brands is lower, and any manager will obviously choose not to advertise their brand.

1. Introducing the “Wow” Factor

Most big brands create their so-called “WoW” strategy, where they decide to make something extraordinary in order to make people talk about their brand. For instance, one of the leading car manufacturers for electric vehicles, Tesla has never spent a dime on advertising. They are focused on creating unique designs that will impress people and make them talk.

This is an example of smart advertising, where they can build brand trust, promote the quality of their products, and spread a word about their brand without spending money on advertising.

Studies have shown news story has a far more significant impact on building trust and relationship than an advertisement, and when it comes to luxury brands trust is very important. Building a story behind a luxury brand is the only way to stay competitive in these tough times.

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