The Role of Social Media for Luxury-Brands – Motives for Consumer Engagement and Opportunities for Businesses

12 Pages Posted: 8 Aug 2013

See all articles by Benedikt Jahn

Benedikt Jahn

Ludwig Maximilian University of Munich

Werner H. Kunz

University of Massachusetts

Anton Meyer

Ludwig Maximilian University of Munich

Date Written: August 7, 2013

Abstract

Social Media today is omnipresent and Brand pages on online channels like Facebook, Google, Twitter, or YouTube are getting more and more popular around the world. The customer engagement on these platforms has changed the idea of relationship marketing. Traditionally, companies have tried to reach out and build up relationships with customers through marketing activities like reward programs and direct marketing. In this old world, customers were passive "receivers" of relationship activities as well as brand messages and the company had control over the brand development process. Today, customers engage and act as co-creators and multipliers of brand messages.

Almost every successful brand-oriented company operates at least one brand page on Facebook, Twitter, or YouTube. Luxury brands like Armani, Burberry or Dolce & Gabbana have increasingly invested in social media. Nevertheless many marketing managers are still skeptical and questioning whether it is worthwhile putting so much effort into the social media phenomenon, and if it pays off. Especially in the luxury product industry, marketers doubt the value of the mass medium Internet for the unique relationship between exclusive luxury brands and their customers. This shows the need to understand the effects of social media on the customer-relationship in general and particularly for luxury brands.

Therefore, this article discusses the relevance of social media for luxury brands and studies how social media brand pages affect the customer-brand relationship. We begin with a brief overview of the literature regarding luxury brands and social media. We then discuss the value of social media for luxury brands. Subsequently we present a general framework that describes how brand pages can contribute to brand loyalty of the customer and how brand page participation is influenced by various consumer values. Further, we describe a study that has tested this general framework and discuss managerial implications for the management of luxury brands.

As a central result of our study we show that social media can be seen as a business opportunity. Brand pages are an excellent tool for brand management, because they have measurable effects on the customer brand relationship. Brand managers should embrace this new channel and understand how to work with it in a contemporary fashion. Our study contributes to the ongoing discussion about the value of social media and shows motives and effects of social media customer engagement.

Suggested Citation

Jahn, Benedikt and Kunz, Werner H. and Meyer, Anton, The Role of Social Media for Luxury-Brands – Motives for Consumer Engagement and Opportunities for Businesses (August 7, 2013). Available at SSRN: https://ssrn.com/abstract=2307106 or http://dx.doi.org/10.2139/ssrn.2307106

Benedikt Jahn

Ludwig Maximilian University of Munich ( email )

Ludwigstrasse 28 RG/4
Munich, Munich 80539
Germany

Werner H. Kunz (Contact Author)

University of Massachusetts ( email )

M-5-213 – 100 Morrissey Boulevard
Boston, 02125
United States

Anton Meyer

Ludwig Maximilian University of Munich ( email )

Geschwister-Scholl-Platz 1
Munich, Bavaria 80539
Germany

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