Shaken Not Sewn

November 9th, 2007

Ah, the fine Vodkas in life.  Belvedere, Grey Goose, Kettle One, Cavalli?  Yes, you read that right. The luxury women’s designer, Roberto Cavalli, is now selling vodka for $85 a bottle. According to yesterday’s Wall Street Journal, Cavalli claims to “filter the hand-made liquor through crushed marble and fine Italian water.”  While that is all well and good, hearing the name Cavalli does not make me want a vodka martini.

On the same note, this week, Salvatore Ferragamo, the well-known leather-goods company, began displaying wristwatches in its showroom on Fifth Avenue. Famous for its superiority and quality in luxury footwear and handbags, will consumers trust the brand and label enough to want to pay $7,300 for a watch bearing the same name? Chances are they won’t – even though the watches are 18-karat gold. Consumers won’t want a Ferragamo watch because the product doesn’t make sense to what the brand represents.

While some companies have successfully pulled off becoming a brand powerhouse, many companies don’t draw a clear line between their original, thriving product, and the new brand extension. For example, Giorgio Armani has just signed a deal with Samsung to produce LCD televisions and now Prada makes cell phones. These brands are violating one of the most fundamental rules of branding: maintain your brand focus in the marketplace. According to Marty Neumeier, brand extensions “make sense when new additions serve to strengthen the meaning of the brand, adding mass and definition to whatever makes it different.” LCD televisions and cell phones do nothing for the Armani and Prada brands in the marketplace except pull them away from their differentiator and focus.

In rare cases, brand extensions can work. Ralph Lauren is a great example of a company that has taken the luxury-brand extension and made it work to its advantage. The Ralph Lauren brand represents a lifestyle. From the beginning, Ralph Lauren has stood for providing quality products that redefine American style and the company was the first to create stores that encourage and invite customers to participate and buy into a specific lifestyle. Today, Ralph Lauren boutiques are really single-branded department stores selling everything from sweaters, shoes and coats to pillows, towels and dishes.

The moral of the story? Classic luxury brands like Ferragamo, Prada and Armani, shouldn’t let the appeal of a boost in short-term profits cloud their judgment in creating luxury-brand extensions that don’t align with the focus and direction of the brand. What’s next? Airplane and car interiors designed by Versace? Oh wait, they already do that.

Posted Under: Branding
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