Continuing to spend on advertising and marketing can help companies, particularly luxury brands, create desire and aspiration.
According to Bain & Company, the global personal luxury goods market witnessed a 23% decline, the greatest YoY drop recorded in nearly 25 years. Given this, more than half of advertising agencies expect their luxury clients to reduce ad budgets in 2021.
This piece argues luxury brands should manage operations to maintain efficiency and preserve cash flow but continue to maintain consumer connection. Reducing ad spends or putting marketing plans on hold will only harm the company’s long-term goals.
With digital commerce expected to prevail, luxury brands should find new ways to engage customers and build its brand equity. Additionally, Bain & Company predicts experience-based goods to recover at a faster pace than personal goods.
[14 minute read]