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78: Lessons in Marketing to the Luxury Retail Client

Written by Rob Stott

July 13, 2021

Karen Brandon, senior marketing manager for Nationwide Marketing Group, recaps her presentation during the NKBA Luxury Defined Summit, and dives into the evolving world of retail marketing.

Catch Brandon’s full session from the NKBA Luxury Defined Summit below. Check out the full slate of on-demand content from the event right here.

Rob Stott: Hi, we are back on the Independent Thinking Podcast and excited today to talk about an area that has been, it’s relatively new for Nationwide Marketing Group, and that’s the luxury appliances space. And today we get to talk about it with Karen Brandon, our senior marketing manager for a whole bunch of things, luxury appliance, consumer electronics, and connected services. Did I get them all, Karen?

Karen Brandon: I think so, as of today, yes.

Rob Stott: As of today? All right. Awesome. Well, I appreciate you taking the time to come and chat about one of those things. And we’ve talked, I mentioned it’s a new initiative, but we’ve been talking a lot about luxury appliances on the Independent Thinking Podcast. We had John O’Halloran on, obviously the senior merchant who’s heading up the luxury initiative. And then we had a NKBA on a couple of times, and lo and behold, those conversations led to some pretty cool stuff that we’re going to get into. But before we dive into all that, tell us a little bit about yourself and your role at Nationwide and your background.

Karen Brandon: Yeah sure. So, I am a retail business manager, turned data-driven marketer. So I started my career in retail, was there for 12 years while I was going through school and then transitioned into marketing, specifically digital marketing, in being able to use the retail routes to help improve the user experience with data and digital marketing. Came from FedEx, where I did testing and personalization for fedex.com and was kind of struck by Nationwide because of the fact that, if pairing the retail with data-driven marketing is what Nationwide is with the independent retailers, so I saw an opportunity and came on board about the end of October 2020. And it’s been a great ride ever since.

Rob Stott: So less than a… A newbie in many ways. So what have these first few months been like for you?

Karen Brandon: They’ve been great. We’ve been able to do some great things and really embrace my out of box thinking, so to speak. I’m never satisfied with the status quo, always think of out of the box opportunities and creative ways to do things. And they’ve been well received and some are a little bit longer, going to take a little bit longer than others, but it’s been really fun and team is great.

Rob Stott: That’s awesome. And I know it’s only been a few months. Well, I guess technically, you’re closer to a year than you are the start of your time here. So what sort of stuff have you been doing as a senior marketing manager? What does the role entail?

Karen Brandon: Oh, it entails that strategy and execution of the verticals that I’m over. So we’ve done some really cool things with impressions, the view impressions to the point of sale and electronics. I did some paid search capabilities with connected services in AT&T that have been going very well. And then with luxury appliances, of course, this NKBA summit, and then also testing out some social media video capabilities in our marketing to try to drive that luxury feel, in a 20 seconds or less video, to the site. So very excited about that stuff and just a lot in a very short amount of time.

Rob Stott: No, that’s awesome. And I mean, kind of boiling it down, everything you do kind of gives you that insight into what a retailer or brand, how they talk and interact, and engage with, and get consumers to engage with them. So a lot of great insights coming out of what you do and what the role is. And you mentioned it, but talk about this NKBA, the Luxury Defined Summit experience that I mentioned in the podcast, we just happened to have some conversations, and I didn’t mean to throw work on your plate, but that’s kind of what ended up happening, but what was that experience like for you to be able to attend and get to experience that show?

Karen Brandon: Yeah, well, it was an honor to be able to attend and present at the show. I was extremely excited about it. I believe Pam, from NKBA was on the podcast and she was a great partner with me throughout the whole process from the virtual green room all the way through the presentation. It was really neat to be able to attend it and then also present. But what really struck me was the versatility, I guess you would say, of this summit because it gave aspects of everything, from designers, to marketers, to data scientists, researchers, it gave the boots on the ground field point of view, as well as behind the scenes. And I thought that was really neat, in those two days to be able to have that whole encompassing feature of this summit.

Rob Stott: Was there anything in particular, you mentioned kind of all those different aspects, but was there one thing or one session that you got to attend that kind of struck you or that stood out?

Karen Brandon: It wasn’t one session, but in general, I believe the epiphany that I had, is this luxury kitchen, so to speak, this is an art, in and of itself. It is a true art. And I did not realize all of the architecture, and drawings, and concepts, and everything back and forth, and materials. I had no clue it was such an art. It’s like building the Taj Mahal, basically, in the kitchen. And I think in then, just encompassing of all the sessions that I attended, that this is a true art. And I did not realize that before.

Rob Stott: And that’s kind of… I think our, we’re so caught up in, on the Nationwide side, the products, obviously, because that’s, and working with the retailers to get these products in their stores. What was that like to be able to kind of step back or, what’s the best way to explain just how different that luxury world is to the broader Nationwide Group, and kind of what they’re used to dealing with on the consumer interaction level?

Karen Brandon: Yeah. So this is definitely a niche market. This is the top 1% of consumers. So the way that you attract them, engage with them, inspire them, is very different than traditional dress purchases or every day consumer. So you really, really have to understand them, understand their thoughts, their feelings, their processes, where to reach them, how often to reach them, and to retain them, most importantly, to capture their loyalty and keep it, because this top 1% represents over two thirds of expenditure.

So you really want to be able to reach them and want to keep them because this very small portion of your audience is representing a lot of your income and profits. So it’s different, it’s a different strategy, it’s a different feel. And it’s important to understand, how they think, to better be able to market them. And I’m very thankful for the NMG members that I was able to speak to who gave me some moments of their time, because I would not been able to make a presentation without getting the data insights that I already know, as well as that qualitative research with NMG members that gave me some time to really understand this consumer.

Rob Stott: That’s such a good point because I think in my own conversations with Pam, and kind of understanding on the design and architecture side, how they talk about working with these luxury clients, it is so different, because I think typically retail interaction, you’re like, all right, well, I got to sell this refrigerator to this customer and talk about their needs a little bit. Whereas with the luxury client, it’s very much more about what they’re feeling, and kind of their inspirations and so much more than just a product that you’re trying to purchase. It’s just very different. The way you’re talking, obviously, I feel like we’ve already started to, but I want to dive deeper into your session.

And you talked a little bit about kind of the work that went into it as you were talking with members and things, but from the overall point of your session, what were you trying to get across? What did you want to get across to the NKBA summit attendee as they were sitting there watching you?

Karen Brandon: Yeah. So this was definitely something very much out of my comfort zone, as I said before, I’m a data-driven marketer. So if I can show you a journey with analytics, and this person did this, this person did that, and have numbers and everything to go behind it, that’s great. But in this session, I had to go into the psychographics of how they think, what their habits, their attitudes, their beliefs, and aspirations, and all of that. And that was, it was very much a challenge for me and a great opportunity to help me moving forward.

And I wanted to convey it in a way that made sense, that was relatable. And then also something they would remember, because I know facts and figures are easy to remember, but thinking how somebody thinks about their kitchen and personalization, that’s something you could forget. So that’s why I developed the acronym for values, with a specific definition for each letter in the word value. So maybe after the session, they may not remember some part of the session, but if they recall that acronym values, that might be able to help them in the future to reach their clients.

Rob Stott: That’s a great point. And I think we see so many sessions where it’s like people… I think about back to when we used to attend trade shows, I know we’re coming back up to that time, but you’ll see people taking pictures of slides trying to capture everything, but it’s usually those words, those acronyms that get made up, that kind of, those are the things that stick. If you want it to be one thing, you’ve got to make it, doing exactly what you did in the way it was presented and pitched, I thought it was awesome. And we have the link now so I think we could share that below in the description of this podcast, if you’re watching the video version, we’ll have it below.

Learn what values is all about, and I know we’re going to dive a little deeper into a little bit of the last two letters there of values. But before we do that, as you were researching for this and learning more about that customer experience and the luxury journey, did you see a lot of evolution because of the pandemic, related to how luxury shoppers or luxury consumers, work with their retail partners or designers?

Karen Brandon: Yes, absolutely. So the pandemic, it really has changed the shape of the luxury consumer, from their internal attitudes and beliefs, to how they approach the design in general. With the pandemic, of course, going and being flashy with your designer labels and logos and all that stuff, that’s not appropriate. And the luxury customer realizes that. So they’re really cognizant of what they’re doing and how they’re spending their money. So they’re really trying to make sure that, if they’re not, they’re still allocating those funds, they’re still spending the money, but since it’s not on experiential spending, bringing that back at home and bringing that home in a way that is not show off, so to speak.

So really going deep into the personalization of kitchen, the design, the use of space, I’ve noticed a lot of these luxury consumers, they’re forced to look at the kitchen more in the past year than they had their entire lives, and their whole house for that matter. So making sure every single space is utilized in storage, and then having, instead of flashy logos or red knobs, or they’re incorporating personalization from their past trips to somewhere special, that they would, like a Palm paint piece in their backsplash or things of that nature, to really, does show luxury, but not in a way that is flashy or inappropriate during a pandemic.

Rob Stott: The other thing you mentioned during the session that struck me was, they’re existing and living during this pandemic, obviously one of the things we weren’t able to do was go to restaurants and experience that out, going out dining, what it was like to go out to a restaurant and dine. So to bring that home and put that into a kitchen and basically make it a kitchen that a Michelin chef could walk into and know exactly what was going on, just kind of speaks to how… We hear so much about it on the home entertainment side, from upgrading TV’s and the audio experience, but also in the kitchen too. It’s cool to see how that translates over into other areas of the home, obviously home office, another one, but making it something where, all right, well, we can’t go out and experience this. Let’s bring it into the home.

Karen Brandon: Absolutely. The whole Michelin star chef restaurant, I mean the wood-burning pizza ovens, coffee bar, built-ins, all of that coming together. I mean, you could be able to walk into this kitchen and it’s like you’ve gone to Starbucks, your five-star restaurant, and someplace for lunch all at the same time. And they really value that and it really makes it, with home values through the roof right now, it really makes it a great experience. And it’s something that we’re going to see moving forward and they’re even taking that outdoor. So that kitchen is going outside to the outdoor life too, in the patio. So it’s an extension all the way over.

Rob Stott: The little aspect, like the bringing Starbucks into the home, it kind of has this connotation of, all right, we’re getting into these hipster luxury kitchens, which maybe is a nice segue into talking about those last two letters of values, which talk about the evolution and sustainable and smart aspects, which are, I think… When I think about those, I think it’s very future-focused and kind of where the luxury kitchen’s heading. And aside from your values acronym, there’s another one that I know you didn’t make, you didn’t take credit for it, because it already exists. But Henry, talk to me a little bit about HENRYs and what they mean, and the importance of them to the luxury market.

Karen Brandon: Yes. The HENRYs. So of course, another acronym that you can definitely remember, the HENRYs are the high earners, not rich yet. This segment is mostly your millennials or gen Y and gen Z. So they are coming up, they are the mobile first mindset, whereas, the end of the millennials, because I am one of them, we each got the smartphone when we were getting out of college, the internet came about when we were in high school, whereas the gen Z, this is how they grew up, with this mobile first mindset. So you have to be able to reach them on their mobile devices first. They have very, very, very high taste and expensive lifestyles, but little savings, little savings, and they work very hard to keep up this luxury appearance, but they also want to seem as if they are not luxury as well.

So it’s being able to appeal to the socioeconomic status and be socially responsible is also important to them. So they’re really, really digging deeper into the digital landscape, starting on their phones, for their values and brands and things of that nature. And they’re really, they look, the first thing they do when they wake up is check their social media, versus the luxury customer of the past read the paper or watched Good Morning America, or things of that nature. So they really are much more in tune with their purchases and the brands that they choose. And then also they are the market that the Bain & Company says by 2025, are going to represent over two thirds of luxury expenditures in the world. So yeah, being where they are today is very important.

Rob Stott: Yeah, exactly that point. It shows that they have this, I say the connotation of these hipster kitchens and up and coming, but they are going to be the consumer of the future, and where a lot of efforts need to… You need to start thinking about it now, if you want to be able to capture them and keep them as loyal customers into the future.

So what is it, obviously I think we’re getting into the point where we’re talking about the importance of digital, and kind of what that brings to the table and how a, whether it’s a luxury retailer or even on the design and architecture side, they’ve got to be thinking differently about how they market to these customers, to these HENRYs. So what is it, what are some of the things that are working or that they need to think about in how they attempt to attract them to what they’re doing?

Karen Brandon: Yeah. So basically, what they’ve been doing on site, what they’ve been doing live, should be able to be exhibited in digital. So augmented reality comes to mind, being able to see their kitchen from the phones, see a design, live cooking experiences. I know that the HENRYs are very, they value being able to see a live pizza demonstration or recipes on Pinterest, things of that nature. Social media is very, very important. And I think we all know the importance of the influencer status.

We can see sales from our products go from negative 25% to 2500% above margin just by an influencer, somebody they look up to or relate with, using that product. So making sure that you’re there when they’re there, and being able to bring any experience that you do live, or any experience that you do in real life, being able to exhibit that digitally, is very, very important, starting with social media and then evolving into live demonstrations, and being able to show what you’re doing outside of your job as well, and protecting the environment with sustainability.

Rob Stott: Sounds, I know for a lot of retailers, and just thinking about the… I know luxury isn’t necessarily for the regular Nationwide Marketing Group member retailer, but I think the message is still one that would resonate because whether it’s on the luxury side or just the nature of shopping in general, millennials and gen Z, they’re the up and coming, the important category that have to be marketed to. So what social media has this kind of daunting, I think, sense to a lot of retailers that aren’t in it, or don’t spend a lot of time in it. So if you could, I know it’s going to sound like a challenge, but if you could simplify what it takes to get into social media as a retailer, or the types of things that they could do to just, baby steps to get into this space, what are some of the things that you would suggest or resources, where a retailer could go to kind of figure their way out in the social media landscape?

Karen Brandon: Yeah, absolutely. So one thing I want to mention, it’s important to note that when the pandemic came, and the digital first mindset evolved, the current customers, whether they’re buying a mass appliance or a luxury appliance, they’re going online first. And I believe the pandemic is shifted 2020 to a 2030 mindset. So it’s relevant to everybody, no matter what realm they’re in, in the whole appliance or in retail in general. So it’s important to note that.

But in any of these spaces, either luxury or electronics, or anything else, it’s important to be in social media, and anybody can do that. It’s not rocket science. It’s pretty easy to set up a business account, setting up a business account for whatever your business is, and then being able to post relative high quality imagery or content. Most of it’s probably already on your phone or on your computer that you already have.

And being able to post that regularly is key. Also, you have customers that say great things about you. They might write you a thank you note. They might be doing it on an online review, but sharing those reviews and those great things that are being said about you across the social media platforms as well, is key.

On the flip side, sometimes, if you have a bad experience, you tell 10 more people about it, is what they say. Responding to that in the social media realm, that takes your approval rating, and it turns a one-star review into a five. By responding say, I understand your concerns. What could I do to help? And people read those trails of those feeds, especially if you have them on social media, and say like, Hey, I might use those guys next time.

So having that high quality imagery, expanding your reviews, making sure that you have hashtags and clients that, Hey, if you had a great experience with us, hashtag Karen’s Appliances, and we’ll give you a $50 off coupon for later, and that’ll help share your content because having great content and then the ability in having those users, those people bring it, is key. And by the way, all of this is free. Doesn’t cost anything, they just need to make sure that they have somebody dedicated to do it, and do it consistently.

Rob Stott: And that’s kind of the key. I think a lot of retailers, whether they’re independents or members of Nationwide Marketing Group or not, the idea of having someone that’s dedicated to it, it can’t be sort of that afterthought. You hear so many times it’s an owner trying to post, your hats, you have so many different hats that you’re wearing anyway, trying to add social media into it because you have a personal Facebook account, that you think you can run another Facebook account, not that simple.

So it’s got to be something where there’s, someone has the time to dedicate towards it because it’s always on, it’s kind of like that your website. I’m sure a lot of over time we’ve seen retailers learn that, all right. Well, a website’s a lot to manage. So we certainly need to have someone that can manage it. Social media is the same way, right? It’s always on, got to have someone always monitoring it. People are always interacting, or have the potential to interact with you. So to kind of leave it alone without anyone watching it, you don’t know what can happen.

Karen Brandon: Absolutely. Absolutely. And a lot of people don’t realize it, and the ones that are excelling in this, are realizing that, Hey, my son or my daughter, or my cousin, or my little niece or nephew, is on social media all the time, as a side job, as their summer job, to make a little bit of extra money, let’s let them do it. If you trust them, of course, and review it. But your best social media posters and sharing of content, are a lot of times within your own four walls or in your own home. So it’s important to know this as well.

Rob Stott: Great idea to look around, you want to keep them busy anyway, so why not?

Karen Brandon: Absolutely. They got a lot of time on their hands.

Rob Stott: That’s awesome. Well, I want to circle back to the S. We talked about evolution and you talked a little bit about the sustainability and smart aspect of this. Talk about that last letter of values and kind of the importance. I know, HENRYs, they also segues into this a lot too, the way they think about product and stuff like that. So talk, just dive a little bit deeper into that sustainability and smart aspect of what your session presented.

Karen Brandon: Yeah, absolutely. So today’s consumer’s thinking, sustainability about, I want it to last, I want it to be a great product. And then the smart capability, yes, they’re using those, but it is not for everything, but they just want to be able to control a couple of functions on their appliances or TVs or whatever, from their phone, versus our up and coming market, like I said before, has this mobile first mindset. So they want to control everything from their phone. And they’re also seeing a lot of things on their phone.

So everything that you’re seeing, from the record heat waves, in parts of the country and the world that don’t get above 75 in the summertime, or skyrocketing temperatures or hurricane seasons, they’re really concerned with our environment and the impact that our carbon footprint has on the environment.

So they’re very, I use this in our presentation, woke, is what it’s called, to these issues. And they’re very concerned about it. They truly are, some even go to the point of zero waste, they’re trying to make sure that everything that they use isn’t wasteful. They’re buying recycled plastics, using organic foods, and maybe even having a little garden of their own out on their patio or in their small backyard. So they’re very, very conscious of this and they want their products to have a sustainable sense to them and a story behind them.

So with brands today, if you are not showing your sustainability in your product and what you’re doing outside of the brand itself, you might not be considered luxury in the future because they’re looking at that. They want to tell the story behind their new appliance, or new range or whatever, what they’re doing in the environment, how this is saving energy star in the environment, it’s not taking down the whole grid of the neighborhood at the same time.

So it’s very, very important to them. And then, on the flip side, if what you’re doing is not matching your efforts in sustainability, I think we know that the impact of social media and with just the internet in general, how somebody can go from the top to the bottom in a matter of minutes with the sharing and exposure, through this technology and this space. So it’s very important to practice what you preach, so to speak, in sustainability. And it’s not going to go away. It’s not going to go away at all. So it’s something to very much think about, a lot of the features are already there.

Rob Stott: Yeah. And to the sustainability point, I think to some older, we’ve seen presentations, as far as the gen Y, millennial, gen Z, and where they want to work, and brands they engage with, and those sort of, the social issues, the environmental issues always seem to come up in those types of surveys about the way they think and the way they shop, and the way they choose where to work even, at times. So not surprising to kind of see it play out too on the luxury side of things.

And on the smart side, it’s kind of funny. When I see the way that they want more control over their products and things like that. When I think about technology, I always think about kind of those quick overturns of, people are getting phones every year, or upgrading their phones to get the latest features year after year.

However, if you think about, and this kind of ties into the sustainability side with luxury appliances, the upgrade cycle for the luxury customer I know is a lot longer, or it’s expected to be a lot longer. I think, what is it, 20 years is what they want, and that’s at a minimum, I think, is what you had presented. And I know that typical upgrade cycles for appliance is seven to 10, is what is talked about, but kind of funny to see how they want more smart things, but they also want the lifecycle to be longer, it’s just kind of interesting to think about how, if new features come down the line in two years after they buy a luxury appliance, what does that look like? Are they going to want a new upgrade their range to the latest Apple version of whatever comes out down the line of a luxury appliance?

Karen Brandon: Yeah, absolutely. So those appliances need to have those smart features that have software upgrades to speak so they can possibly stay in line and keep up with the times. Yeah, absolutely.

Rob Stott: But that’s a lot of great stuff. And, as I mentioned, we’ll have the session below, so if people want to watch it, a lot to learn, just about how this market has changed. And I think, too, it is a very different market as we talked about at the top, but I think it’s one that a lot of the lessons can be shared throughout the rest of the retail space, in the way retailers are marketing themselves and the brands that they carry to customers, as we move on here. So a lot to gather from what you were able to present and neat to see that you got something out of it too, not just the fact that you were able to share some stuff, but also that it was an opportunity for you to kind of dive into a new area of this market.

Karen Brandon: Absolutely. Absolutely. I learned a ton and I feel like I’m better prepared as a marketer to reach this audience now. I’m more woke as you can see.

Rob Stott: That’s awesome. Well, I’m happy that you’re able to be woken, as it were. So Karen, I appreciate it. This was awesome. And hopefully, if there’s more presentations down the line or appearances, we’d love to have you back on and learn a bit more about what you’re learning along the way. But I know we’re both busy, we’ve got PrimeTime right around the corner. Your first in-person PrimeTime.

Karen Brandon: First in person PrimeTime. Yeah, I’m excited.

Rob Stott: What are you expecting? What are the expectations for Nashville for you as your first in-person PrimeTime?

Karen Brandon: Well, I think first off, I have worked with people over the past few months, all the way from Florida, all the way to Seattle. I’m just excited to see these people in person because we’ve only seen each other from the neck up. I want to actually shake their hand or give them a hug around the neck if needed, that’s what I’m excited to see, to see all these people. And I’m excited to experience everything coming to life, all of the brands, vendors, I want to talk to more retailers. I went to one regional meeting in St. Louis. And just that one day I was able to gain so much information, learn more about their life, the supply chain, everything. And I want to do more of that. And then I am a little big town band. So I’m excited about that too.

Rob Stott: I think we all are a little bit now, just to get back and celebrate it the right way. So a lot to look forward to, a lot of work to happen, that needs to be done up until then. So I’ll cut this here and make sure we both have time to get what we needed so we can have a successful event there out in Nashville. So I appreciate it. And look forward to seeing you, and, hey, meeting you in person.

Karen Brandon: Yes, you too. Thank you. Thank you so much.

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