“Luxemium”: the convergence of premium and luxury in beauty?
03/06/2013 by The Red Tree
Stirling Murray, CEO of The Red Tree, and Shabana Erbrahem, Founder of Soul Consultancy, have co-authored a collaborative think-piece entitled Luxemium, that explores what “luxury” and “premium” mean in today’s ultra-competitive world of beauty offerings and why premium brands must make the most of their luxury assets.
Here, we share with you 5 key insights for premium beauty brands from the Luxemium article:
1. Premium brands are essential to the growth of beauty
Premium brands have an increasingly important role to play in the beauty sector, thanks to heightened consumer desire for high-end beauty and the power of the internet. Premium engulfs a very large territory which can include some luxury brands; hence some brands can often fall into both camps. Don’t underestimate just how vast this space is –all the more reason to have a powerful identity and communicate messages clearly to your audience.
2. Identify what you mean by premium
In order to reach the right audiences with correctly tailored brand messages, we must be clearer about how we identify brands rather than encompassing them all under a general premium banner. Which camp does a brand fall into? Is it luxury, is it premium, or both? When talking about premium beauty, which kind of premium do we mean –department store, drug store, supermarket or online? What about the shopping experience? How does it reflect, add to or even destroy the carefully built brand position and its provenance?
3. Put consumers at the heart of the innovation process
The premium beauty sector is innovative and deserves recognition in its own right. Regardless of how big or small the brand, innovating in silos is pointless. Think about who your consumers are –beyond demographics, by building a deeper understanding of markets and people; what do they believe in and care about? How do they live their lives? And importantly, what are their perceptions and expectations of premium and luxury? How consumers think of, and segment premium and luxury, is immensely valuable in the development of the category.
4. Understand digital channels and online behaviour
Premium beauty needs to make the best use of digital platforms, as consumers increasingly look to the online space for information, ideas, tips, tutorials and shopping. Online behaviours, use of multi-screening and online purchasing are becoming increasingly important for brands to get to grips with. Understanding the role of various platforms in consumers’ lives, and how they affect shopping decisions is essential for the future of the premium sector.
5. Harness the power of luxury brands but don’t imitate
Harnessing learnings from luxury brands, whilst developing strong identities of their own will be essential for brands in premium beauty as the sector enjoys continued growth.
Have a clear message, tell a great brand story, define your audience and understand them as much more than a demographic.
Create a brand world that is unique and special to your particular brand and ensure that this is reflected through an integrated marketing method, with consistency and clarity.
Don’t imitate luxury; be authentic and be proud to be premium.
The Red Tree is the UK’s leading international beauty brand consultancy and a powerhouse of ideas, insight and inspiration. For an informal discussion on how we might help you, please contact us.
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Any company entering The Beauty Accelerator™ competition must be based and registered in the UK.
The scheme by which investment into the winning brand will be made is the Seed Enterprise Investment Scheme (SEIS). You must be eligible for SEIS to enter The Beauty Accelerator but you do not need to be registered for SEIS. You can be in the process of applying for SEIS and receiving Advanced Assurance from HMRC, which is free of charge to obtain and certifies to investors that the criteria necessary to qualify for SEIS have been met by the company at the time of the application. You do however need to be SEIS registered at the point of investment.Click here For further information about SEIS
As is the case with all equity investments, the winning brand must be willing to provide equity stakes for both SFC Capital and The Red Tree. In addition, the winning brand might be required to pay a monthly fee for the duration of the 12 month period of assistance from The Red Tree. The size of the equity stakes for both SFC Capital and The Red Tree are unknown at this stage and will be based on the valuation of the business at the time of investment. The value of the monthly fee to The Red Tree will be determined by the scope of work required by The Red Tree and will be agreed in consultation with the winning brand. The equity stake, monthly fee and scope of work will be discussed in further detail with short listed brands during the interview stage.
Brands that applied for The Beauty Accelerator™ 2022 can apply for The Beauty Accelerator™ 2024.
Applicant brands should ideally have proof of concept – the business should ideally be in operation with at least one product currently retailing on the market, an existing website in operation and a number of months of trading.
Under exceptional circumstances, brands that are at concept stage will be considered.
There should be a team in place or a willingness to take on a co-founder at an early stage.
A business plan must be in place and submitted as part of your application to demonstrate the revenue that can be delivered.
The business should not be valued at more than £1,000,000.
All R&D should be completed as funds invested will only be used for marketing and commercial activity.
If you are short listed, you must be available to attend the virtual shortlist interview. It is likely that short listed brands will be required to attend more than one virtual interview.
If you are a Finalist, you must be able to attend The Beauty Accelerator™ Final, either virtually or in-person.
You cannot apply for or already be in the process of applying for another accelerator or incubator during the period December 2023 to December 2024.
If you are selected as a finalist, and if you go on to win The Beauty Accelerator™, you must agree to exposure of you and your brand through The Red Tree’s, SFC Capital’s and Freeths online and social channels and a possible marketing campaign.
Confirmation of the winning brand is subject to SEIS eligibility confirmation, agreement on equity stake and The Red Tree fee, and completion of due diligence.
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