Luxury Products And Consumer Behaviour

Published Date: 23 Mar 2015 Last Modified: 05 Jun 2017

This chapter reviews related literature pertaining to the study of (a) Brand, (b) Consumer Brand Perception with regards to the attributes like celebrity endorsement, store design and presentation and country of origin effects,(c) Luxury products and (d) Consumer Behavior with respect to luxury consumption.

The Singapore luxury fashion industry is becoming extremely competitive where top brands from around the world are competing for the market share. The development aspect has also shown that customers no longer want to incline themselves towards cost effective products but look for premium and branded goods to fulfil their need for a sophisticated and global lifestyle (Keller, 1993). Since most of these brands have luxury products that are similar in terms of the quality and price it becomes difficult for the consumer to make a purchase decision. In this situation, brand perception is the key discriminating factor that can assist a consumer's decision to select one brand over the other.

3.1 Brand

An American marketing firm says that "Brand is an art and foundation of marketing" and defines brand as a name, term, sign, symbol or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors (Kotler 2000:435). A company makes the product and the consumer buys the brand (Kapferer, 1996). The main element that differentiates a product and its brand is the consumers' perception and the feelings towards the components' of the brand (Achenbaum, 1993). Therefore a brand is not a name, logo, colour scheme or a design; it is about the customer's perception. Customers believe in what they have experienced from the product than believing the advertisement (Newell and Godin, 2003). For example, when consumers buy luxury fashion products from brands such as Armani or Christian Dior, the past experience with a particular brand is the key aspect that backs the consumer's perception.

Brands help marketers to gain that extra mile in a competitive market by upholding differences between other competitors. There are many different components in a brand, which are packaging, advertising, brand name, promotion, product and presentation. Widely known brands are asset to any company. A brand gathers loyal consumers by years of good consumer experience and heavy investments on quality and on the advertisements of the product. Brand source is where consumers could identify the product, where the product and the brand are associated together, which creates a brand image in consumers' mind (Kotler, 2003).

The huge percentage of the luxury fashion market in Singapore is controlled by consumers and not by brands. The reason for this is that Singaporeans have multiple choices and there always seems to be ten different choices for one product! This makes the consumers to look for different price levels, qualities and brands. According to Yang (2007), the consumer perception about a brand is more or less the same as the perception about an unknown human being, such as what their values are, what does the brand stands for, how it looks and so on. However, consumers' perceptions are not always right. For example, if a consumer is asked why they buy a particular product the answer given by the consumer is very rational. No one can jump into conclusions with the rational answer given by the consumers as they may buy a particular product because of several personal reasons like price, quality, country of origin etc. Or, the reason might be simply because that is the only brand available in the market.

Understanding the relationship between the brand and the consumers is also vital in order to know how consumers form perceptions about luxury fashion brands leading to purchase decisions. Knowingly or unknowingly, consumers consider the possessions as a part of themselves (Belk, 1988). Therefore consumers wish to purchase luxury brands as these high end brands are a way to convey social meaning and a short cut social acceptance (Auty and Elliott, 1998). The purchase of luxury brands helps the consumers convey the message to the group members that this is the way they are liked to be noticed within the group thereby improving the social belongings (O ' Shaughnessy and O ' Shaughnessy, 2002). Therefore, luxury brands are considered important an important role in the construction of self (Carroll, 2008). Thus, the idea of improving their self image makes consumer perceive that purchasing luxury fashion brands will help them find a fit within their aspired group.

3.2 Consumer Brand Perception

The concept of brand perceptions has been a subject of study for many researchers and has become vital for the activities in the business environment. Studies have recognized that brand awareness and brand image are the two components of brand perception (Keller, 1998). Having only awareness about a brand is not a good enough reason for a consumer to make the purchase decision but the brand has to give products that are valuable to the consumers as well as be different from the others (Fill, 2002). Brand perception is defined as a process by which an individual receives, selects and interprets stimuli to form a meaningful and coherent picture of the brand (Schiffman, 2001). Brand image is the perceptions of the brand reflect due to its associations in the consumers' minds (Keller, 1993). These associations can be the store design and presentation, brand endorsements, country of origin or any other customer benefits (Aaker, 1991). Therefore, our study is mainly focused on these the consumer perceptions of brand quality, price, country of origin and celebrity endorsement.

3.2.1 Consumer Perception process

Before we explain the associations of the brand image it is important to know the consumer perception process in order to understand how exactly consumer form perception towards a brand or the product. Perception is such a basic function that occurs at the subconscious level that we take it for granted without really knowing the process of its occurrence (Schiffman, 2001). In terms of consumer behavior, perception is referred to as a process where in a consumer develops awareness about a product or a brand and interprets accordingly and assigns meanings to them to fit into his or her frame of reference (Walters, 1989). The past likes, dislikes, experiences and beliefs form the individual frame of reference (Van der Walt, 1991). The consumers go through five distinctive stages before they form a perception i.e. exposure, the consumer perception process consists of five processes i.e., exposure, attention, organization, interpretation, retention and then make the purchase decisions (Hawkins et al, 1992).

EXPOSURE

ATTENTION

ORGANIZATION

INTERPRETATION

RETENTION

PURCHASE

DECISION

Fig 3: Consumer Perception Process

Source: Hawkins et al, 1992

Exposure occurs when the stimuli comes in the range of one of the sensory receptors either intentionally or accidently. This exposure could be hundreds of products or advertisements an individual comes across on any given day (Belch et al, 1995). Attention occurs when the consumer gives attention or notices the advertisements. If the consumer does not focus on the stimuli i.e. the advertisement, attention does not occur though he or she has been exposed to it. This is the first most important stage from the markets point (Assael, 1992). Organization can be defined as the combination of pieces of information that are put together to form a single piece of information as a whole and retain the final meaning (Assael, 1992). For example, an advertisement board may show a celebrity flaunting a designer luxury bag with brand logo and a tag line. The consumer collects these pieces of information and puts them together and forms a meaning out of it. The meaning may be perceived differently by different consumers based on their level of understanding. Interpretation is defined as a process in which the consumers retrieve the previous experiences from the long term memory and attach to the stimulus (Mowen, 1993). The expectations in terms of what the stimulus must be like are also taken into account while interpreting the message. This is the second most important stage because the purchase decisions are based on this stage to some extent. One drawback at this stage is different people interpret differently due to the personal liking and bias (Mowen, 1993). Retention refers to the storage of the information that has been evaluated in the minds of the consumer so that this information can be retrieved in at the required time (Van der Walt, 1991). The entire perception process is a failure if the information is not retained by the consumers. Finally, consumers make the purchase decisions based on the perception they have formed about the product or the brand.

Further, we study how the three key attributes influence the consumer brand perception. The attributes are:

Store Design and Presentation

Country of Origin

Celebrity Endorsement

Each of these is reviewed in the following sections.

3.3 Store Design and Presentation

The literature review is focused on the store design and environment of leading luxury fashion brands in Singapore and how it has an impact on the consumer perception which influences them in making the final purchase decision. A consumer makes perception about various attributes such as the display, the music, lighting, the arrangement and the overall architecture (Schlosser, 2001). These attributes as a whole constitute the store image (Milliman, 2000). The store image can be defined as the consumer's perception about the depending on the stimuli they receive (Peter, Olson, 2005).These are the first the first elements that a consumer observes and makes a perception (Schlosser, 2001). Therefore having a good store atmosphere for increasing the store image in the minds of the consumers is no more an option but a requirement (Saffer, 1996) as it's the main reason that attracts consumers' to enter the store (Peter, Olson, 2005). The following diagram suggests that by incorporating all the attributes such as availability, organization, space, service, signage, products and displays will appeal to the consumers by making the shopping experience convenient and hassle free leading to consumer values such as satisfaction and happiness. These values henceforth help in enhancing the brand image in the mind of the customers further affecting their purchase decision positively (Kent, Kirby, 2009).

Positive Perception

Fig 3.1: Store Design & Presentation - Attributes affecting consumer perception

Source: Kent and Kirby, 2009.

3.3.1 Two Dimensional Conceptualization of Store Atmosphere

A model suggested by Wright and Noble (1999), indicates the two dimensional view of the store atmosphere influencing the consumer attitudes and buying behavior. They continue to explain that the perceptions of the store atmosphere vary from consumer to consumer depending on their interpretations. However, this perception comprises of two elements, the functional attributes and the affective attributes.

STORE

CUSTOMER

ATMOSPHERE

FUNCTIONAL

DIMENSIONS

AFFECTIVE

DIMENSIONS

CONSUMER BEHAVIOR AND ATTITUDES OUTCOME

Fig 3.2: Two Dimensional Conceptualization of Store Atmosphere

Source: Wright and Noble, 1999

The functional dimensions include attributes such as price, quality, sales representatives and attractiveness of the store (Samli et al, 1998). Other researches confirm that the store image is characterized by the functional attributes (Darden and Babin, 1994). These attributes help in forming the overall impressions about the brand or the product (Haynes et al, 1994). Affective dimensions refer to the intangible characteristics such as in store emotions such as arousal and pleasure that the stores atmosphere invokes from the consumers (Darden and Babin, 1994; Kotler, 1991). Studies continue to indicate that the stores atmosphere is a vital component in influencing the consumer purchase process (Sherman et al, 1997). Even elements such as music, lighting, temperature and scent influenced consumer perception which eventually made the consumers spend more time in the stores and shop more that intended (Donovan wt al, 1994). Therefore it is evident from the above literature that the store atmosphere plays an important role in influencing the image of the store in the minds of the consumers.

Studies have also shown that the location or the state in which a consumer comes across a product influences their perception about the brand (Shavitt et al, 1992). For example, when a consumer views a luxury bag of Louis Vuitton in a state of the art showroom, he or she will connect this to scale of social standings such as style and status, but when the same product is viewed in the manufacturing unit; it will be perceived as any other average product. Researchers have argued that even the stores have a social image and this image is communicated to the consumers' through the store design, presentation and atmosphere (Kotler, 1991). For example, the atmosphere in a Louis Vuitton store will justify the type of consumers' who utilize the products of the brand.

In conclusion, the study of store design and presentation gives a fair idea on the level of influence it has on the consumer purchase decision.

3.4 Country of Origin Effects

The following study is intended to observe the influence of country of origin on a Singaporean consumer's perception of luxury fashion products. Since the 1960's this topic has drawn interest in the buying behavior literature and has always been a strong determinant of a products quality perception and a fundamental factor in consumer purchase decisions (Schooler 1965). Many studies suggest that the country of origin influences consumers in many ways such as product choice, perceived risk and particularly in evaluation of product in terms of quality perception and purchase intention. (Liefeld, 1993; Papadopoulos, 1993; Kaynak et al., 2000; Li et al., 2000; Brodowsky, 1998; Chao, 1998; Huddleston et al., 2001).

The country of origin is defined as the region to which a particular brand is perceived to belong by its consumers (Thakor & Kohli, 1996). Johansson, Douglas & Nonaka (1985) define country of origin as a country that is typically associated with a product regardless of the actual place of manufacture. When consumers have insufficient brand information, judging the quality of a particular product becomes complex (Thakor & Kohli, 1996). Thus the country of origin can be used to form an association with the brand thereby making the purchase decision simpler for the consumer. For example, sometimes consumers may not have enough knowledge about the Louis Vuitton brand except for a fair idea that it is a French based luxury product. This country information is adequate for this consumer to make a positive perception of the product and thereby making a quick purchase decision.

Many researchers have confirmed that the country of origin has a considerable effect on the consumer perception. Consumers perceive products based on which country it has been sourced or originated from (Chinen, 2000). Also many studies indicate that the country of origin has a substantial influence on consumer product assessment and decision making process (Solomon, 2002).

The extent of impact on brand image perception by the country image has also been supported (Hsieh and Lindridge, 2005; Kotler and Gertner, 2002; Stennkamp et al., 2003). A declaration made by Takhor and Lavack (2003) says that the brand origin or the country of origin is a vital factor that plays a key role in establishing a brand perception. When a brand comes into the market it and reaches the consumers, it will have an association with its country of origin. Investigations have been carried to prove that the culture of the country to which a particular brand belongs to have a direct impact on the way in which consumers make brand evaluations and perceptions (Kenny and Aron, 2001). The references a consumer makes and the inferences a consumer gives to brands on hearing or seeing information about a brand is referred as the culture of brand origin or country of origin. Likewise, our research will also prove the impact of country of origin information on consumer brand perception. For example, when a consumer reads or hears about Gucci, he or she automatically associates it with its country of origin which is Italy. Italy is known for its fashion and is considered as a house of fashion where fashion is embedded in its culture. Therefore, when evaluating the brand, the consumer takes this country of origin information into account and makes a relative perception which in this case is positive.

The knowledge and the familiarity about a products country of origin influence how a consumer perceives the quality of that product (Hong & Wyer, 1999). While assessing the quality of luxury products, the country of origin played a more important role then the price of the product (Heslop & Wall, 1991). According to Gürhan-Canli and Maheswaran (2000), consumers usually choose shortcut such as country of origin or brand origin as the basis for evaluating and judging the product quality. Hong and Wyer's (1999) studied consumer product evaluation by comparing the product attributes and the country of origin and discovered that the consumers are most likely to use country of origin as a basis and associated it to product attributes such as product quality thereby influencing the consumer brand perceptions. For example, Armani and Dolce and Gabbana have Italy as their country of origin. Italy is known to have produced numerous quality fashion designers ever and has established a belief among fashion consumers and has communicated a superior image of product quality. Once the consumers are aware of such information about the country, it becomes effortless for them to associate this information to the product and thus influencing the brand quality perception.

In the early stages, the country of origin was mistaken to be the country in which the product was manufactured (Nebenzahl et al., 1997) or the name of the country that appeared on the 'made in' tag. It was only during stages the concept of country of design become known which referred to the country in which the product was designed and developed (Jaffe & Nebenzahl, 2001). Due the forces of globalization, many organizations have opted to shift their manufacturing operations to various nations. Therefore in most cases the brand origin and the country in which the product is manufactured are different. When the brand comes to life it comes with the 'Made In' tag. This 'made-in' tag will not affect the consumers' purchase intentions as long as the country of origin is strong (Haubl, 1996). Since consumers are aware of the country of origin, they may refer to that country when evaluating the brand in spite of the product being produced in a different county than the brand origin. For example, Armani's country of origin is Italy; many of their products are being manufactured in China. But since Armani's country of origin is deeply rooted in the consumers' mind, it of little or no concern to the consumer where the product is being manufactured, they will still consider the country of origin information while evaluating the product or the brand. According to Hui and Zhou (2003), different levels of equity i.e. high equity and low equity brands can be used to study the differential effect between country of origin and country of manufacture. The results of this study confirmed that the country of manufacture information did not influence the product evaluation for high equity brands. Conversely, if the country of manufacture has a lower image than the country of origin, it negatively influences the product evaluation and is most likely for low equity brands than high equity brands. For example, though some of Armani's products are manufactured in China, cause of the high equity status the brand holds among consumers', the country of manufacture information has no effect on the product evaluation.

Country stereotypes are an influential factor which plays an important role during product evaluation and purchase decisions (Piron, 2000). Examples of country stereotypes are: Germans are known to be very hard working or the Chinese are known to be polite etc. The main purpose of the studies carried out by Piron (2000) was to determine the extent to which country of origin information plays an influential role on the consumers' purchase intention. The outcome of the study pointed out that the country of origin information may not be an important factor while purchasing products but would certainly influence consumers' buying decisions when the purchase is made on luxury products and goods rather than essentials (Piron, 2000). In our study, we are talking about luxury brands such as Armani, Louis Vuitton and Gucci which are headquartered in Italy or France. These countries have been stereotyped as being the originators of fashion. Therefore, knowing the country of origin of the above mentioned brands will surely play an influential role on the buying decisions as these are luxury products and not necessities.

Well-known country of origin for the product will have a positive significant impact while unknown country of origin will have significant negative impact (Koubaa, 2007). Products that originate from more developed countries will be positively evaluated that those which are from the less developed countries (Lin & Strenquist, 1994). Consumers' often have a perception that the developed countries such as Germany, France, Japan and USA make the best products. They purchase German cars, Japanese electronics and French and Italian designer fashions (Piron, 2000). These countries are not only known for their engineering and designs but have also projected an image that exhibits a very elegant and fashionable lifestyle that attracts the consumers. Therefore consumers have a positive perception of luxury fashion brands such as Louis Vuitton and Armani as they originate from developed countries that have always portrayed an image where fashion is considered as a part of their lifestyle.

A study conducted by Far Eastern Economic Review's (FEER) on Asia's lifestyles indicated that most of the consumers from the Asian countries considered products from European countries when it comes to the purchase of luxury fashion products ('Despite Crunch', 2002). By purchasing luxury fashion products that originate from countries like Italy, France, Germany or Spain, many consumers' feel that they are closer to that particular countries' lifestyle (Dubois & Claire, 2003). Therefore, by the above review it is quite clear and evident that a consumers' perception towards luxury fashion product is affected by the country of origin and the country or origin information is an influential factor in the product evaluation and consumer buying decision process.

3.5 Celebrity Endorsement

Celebrities are highly important and valuable to brands especially in the luxury fashion sector (Okonkwo, 2000). Organizations have used celebrities as a part of their marketing strategy in order to support their brand image (Erdogan, 1999) and create favorable associations leading to positive brand knowledge (Carroll, 2008). In the past, there has been vast amount of literature available which has focused on celebrity endorsement in terms of its positive and negative effects and the attributes of a celebrity endorser such as attractiveness, likeability, familiarity, trustworthiness and expertise (Till and Busier, 2000; Bush, 2004; Erdogan and Drollinger, 2008). Previous studies have indicated that the use of celebrities for brand endorsement have positively affected consumer buying behavior in terms of clothing style and product choice (Brown and Basil, 1995). There has also been evidence that the perceived image of celebrities has a positive impact on product buying behavior (Goldsmith, Lafferty, and Newell, 2000). This literature will give a deeper insight on the use of celebrity endorsement influencing consumer brand perception and consumer purchase decision of luxury fashion brands.

Celebrity endorsement is defines as "an individual who enjoys public recognition and uses this recognition on behalf of a consumer good by appearing with it in an advertisement" (McCracken, 1989, p.311). Movie stars and sports stars are the most widely used celebrities for product endorsement (Shimp, 2003). Usually, celebrities enjoy recognition and often have the power to influence an individual or a group of people towards the endorsed product which will positively affect the consumers' brand choice behavior (Alsmadi, 2006). Experiments suggest that in certain situations, celebrity endorsement can enhance recall and helps in assessment of the products (Clark & Horstman, 2003). Studies have also indicated that the consumer buying behavior is affected considerably when the message comes from a well known person (McCracken, 1989) and particularly, when consumers feel they can identify themselves with the individual (Baker, Tagg and Erdogan, 2001).

McCracken's (1989) used to the meaning transfer model to explain the connection between the celebrity, the product and the consumer. This is a three stage process that involves the creation of the celebrity image, transfer of meaning from the celebrity to the brand and finally transfers of meaning from the brand to the consumers (Schlecht, 2003). When the celebrities endorse certain brands some of their meanings such as success or beauty which describe what they represent get transferred to the brand or the product. Finally when evaluating the brand, the consumers associate themselves to the meanings the celebrities represent which makes their purchase decision simpler (McCracken, 1989). This can be explained with an example. As a celebrity, Madonna has acquired meanings such as elegance, sophistication, attitude and beauty. When endorsing for Dolce and Gabbana, these meanings are transferred on to the brand and its products. Eventually, this makes the consumer purchase decision simpler as they relate to the meanings represented by the celebrities which lies within the brand and its products (Khatri, 2006).

In addition to the meaning transfer model, there were other important studies that show how the consumers relate themselves to celebrities. There are different reasons that drive the consumers to relate which is entertainment and fun or intense attachment or pathological urge (McCutcheon et al., 2002). Further the process of identification will give us a deeper insight into how consumers are influenced by celebrities (Kelman, 1996). He suggested that the process of identification will assist an individual in getting influenced by another person or group. Identification is a process where an individual adopts the behavior of another person or group for enhancing the individuals self image (Kamins, Brand, Hoeke, Moe, 1989). This process is assumed to be related to characteristics like attractiveness and likeability that determine the extent of celebrity influence on consumer perception and purchase decision (Shimp, 2003).

Source attractiveness (similarity, familiarity, likeability and attractiveness) and source credibility (expertise, persuasiveness, and trustworthiness) are the main general attributes that determine how celebrities influence consumer perceptions and purchase decision (Shimp, 2003)

According to the source attractive model, consumers generally respond positively towards brands that endorse attractive people and effectiveness further depends on the familiarity, liking, and similarity of the endorser (McGuire, 1985). Therefore, celebrities who are attractive tend to influence consumer perception and generate purchase intentions (Carroll. 2008). A celebrity spokespersons' physical attractiveness has a positive impact on brand recall, attitude towards the brand and purchase intent (Kahle and Homer, 1985). Attractiveness does not mean just physical attractiveness; it can be certain characteristics such as intellectual skills, personality traits or lifestyle that can persuade the consumers to make the purchase decision (Shimp, 2003). If the consumers find a particular celebrity attractive they try and identify themselves with the celebrity and further seek for some kind of relationship by adopting similar preferences, attitudes or belief's (Belch and Belch, 2001).This make the consumer feel a part of the celebrity as well as the company or the brand which influences' the consumer perception and purchase decision (Belch and Belch, 2001). For example, Dolce & Gabbana have endorsed Scarlett Johansson as their brand ambassador. Apart from being one of the most beautiful women in Hollywood, she is also a great actress and a fashion icon. In one of the advertisements, Dolce & Gabbana have represented her in such a way that the images capture passionate feminine moments like a women applying makeup in the privacy of her bedroom. Such advertisements will easily catch the eye of the consumer in a flash because the person representing this is extremely famous as well as very attractive. This persuades the consumer which leads to a purchase decision. Likeability refers to the degree to which a celebrity is admired by the consumers (Belch and Belch, 2001). Familiarity is the popularity the celebrity has among the consumers (Belch and Belch, 2001).

Similarity refers to the resemblance between the consumer and the source (celebrity) in terms of the age, gender, ethnicity and social class (Shimp, 2003). According to him, this attribute is of great importance because consumers' like individuals who share similar characteristics which further increases the trust due to the gender, age or ethnicity match. A consumer gets influenced more easily when the message is delivered by an individual with whom the consumers' sees some sort of similarity (Belch and Belch, 2001).

Credibility refers to the tendency to trust or believe someone (Shimp, 2003). Credibility involves an individual's positive characteristics like skills and experience that will affect the consumers' acceptance of a message (Ohanian, 1991). Celebrities who are considered as credible sources have the highest influence on consumer attitudes and purchase intentions (Goldsmith, Lafferty & Newell, 2000). The behavior of the consumers tends to change when the individual is perceived as a credible source. Moreover, consumers believe an individual who they perceive to be trustworthy in terms of honesty and ethics and an expert in the respective field (Belch and Belch, 2001). The degree to which an individual is confident in communicating the message he or she considers being the most valid is called trustworthiness (Ohanian, 1991). Once this attribute is well perceived, the message delivered by an individual is more effective and will me more easily incorporated. Expertise is referred to the extent to which an individual is perceived to be valid in his or her assertions. It is the individuals' knowledge and experiences that influences the consumers' perception of an endorsed brand (Belch and Belch, 2001). Further, the purchase intentions of a consumer are influenced by the perceived expertise of a celebrity (Ohanian, 1991). Other studies suggest that as long as the celebrity is perceived to an expert, the consumers' opinion towards the endorsed brand will surely change (Shimp, 2003). Also, the credibility on expertise makes the product more desirable and improves the perception on quality (Khatri, 2006).

Respect refers to the perceived quality which is reflected from an individual's accomplishments and personal qualities such as athletic or acting skills. An endorser with such respect will add to the brand image and persuade the consumer towards the brand (Shimp, 2003). On the whole, the more credible the celebrity is, the more easily will the consumer be persuaded to purchase the endorsed brand. Recent studies have also revealed that the endorser's credibility has the strongest effect on the consumers' attitude towards the brand (Goldsmith, Lafferty, and Newell, 2000). For example, Richard Branson, one of the most successful business tycoons has a very strong credibility on the mind of the customers because of his various successful ventures. So when he endorses a product, it positively influences the brand perception.

3.5.1 Negative Information Effect of Celebrity Endorsers

While the celebrity endorsements have influenced the consumers' perception positively towards a brand, there are many studies on endorsements that indicate few negative impacts on consumer brand perceptions. Any negative information about the celebrity will lessen the consumers' trust towards a brand and will affect the consumer buying behavior (Reizebos, 2003).This fact is well supported by many researchers and authors who explain that any negative publicity of a celebrity will have an effect on the consumers' perception about that brand and will put the products image at risk (Till and Shimp, 1998 and Amos, Holmes & Strutton, 2008). Further, studies indicate that the negative information will not only change the consumers' perception about the celebrity but also break the link with the brand (Klebba and Unger, 1992 & Erdogan & Baker, 2000). Michael Jackson's child molestation charges would have stained Pepsi's brand image had the company not decided to drop him as the brand ambassador for his previous allegations (Amos, Holmes & Strutton, 2008).There were allegations against Kate Moss of drug consuming which tarnished the brand images of Chanel and Burberry (Wall Street Journal Online, 2005).Generally consumers tend to evaluate negative information more strongly than positive information and since this happen in the early stages it leads to categorization of products (Ito, Larsen, Smith and Cacioppa, 1998). Other studies suggest that negative information is evaluated more negatively than positive being evaluated more positively and is easily remembered than positive information (Kensinger and Corkin, 2003). There any negative behavior by a celebrity who is endorsing a brand will quickly attract attention by consumers and will be registered and recalled easily. On the basis of the above literature we can infer that consumers' perceive products less positively when supplied with negative information (Money, Shimp & Sakano, 2006). And since celebrity endorsement is very important in luxury fashion business and forms the basis on which consumers' perceive the brand, any negative information about a celebrity leads to a negative consumer brand perception and will be an obstacle in the consumer purchase decision.

3.6 Luxury Products

The study of the term 'luxury' will help us understand why consumers perceive a particular product as a luxury good. There are two ways of considering a product or a brand as luxury, one is because of the excellent quality and the other is social status the brand represents (Dubois and Duquesne, 1993). But in most cases a product is considered as a luxury due to its superiority in terms of the high price and quality (Tervydyte and Janciauskas, 2006). The purchasing of luxury products is always associated with high price as this is considered as value to both, the consumer as well as the reference group and one of the key reasons for this purchase is satisfying one's ego (Eastman et al. 1997). However, this does not mean that the more expensive the product the more it is considered as 'luxury'. For example, a top range expensive Zara product will still not be considered a luxury brand while a bottom range product by Gucci will always be a luxury product. Here, it's not the functionality that matters; it is the craftsmanship that gives the brand Gucci a luxury status (Seringhaus, 2002).

Researches indicate that consumers look at luxury from different viewpoints. They connect certain values which justifies their purchase decision.

A luxury product exhibits the five perceived values of luxury namely; conspicuous value, Unique value, Social value, Hedonic value and Quality value that will assist in forming an overall perception of the brand (Vigneron and Johnson, 1999). Further, these values will also drive consumers to make a purchase decision in order to satisfy their needs.

Conspicuous value is defined as the value offered by a product that exhibits the individual's wealth and expenditure on consumption of services (Trigg, 2001). Studies also suggest that conspicuous value of a product is used by people to communicate information about their own such as wealth, power and status (Shavitt, 1990). Therefore, consumers purchase a product based on the perceived conspicuous value to show that they belong to the higher class of the society and helps them being recognized and accepted by others (Twitchell, 2002 and Nia, 2000).

Unique Value is the value provided by a luxury product in terms of scarcity and uniqueness (Laurent and Czellar, 2001). Some studies suggest that when there is a limited supply of a product it increases the perception of uniqueness in the minds of the consumers thereby enhancing the perceived value of the product (Solomon, 1994). Other studies indicate that the need for uniqueness is a personal level trait where the people chose to purchase products that are unique only to differentiate themselves from other consumers (Marketing News, Feb 15, 2005).

Social Value of a product influences an individuals' purchase decision in order to conform to prestige groups and differentiate from the non prestige groups (Dittmar, 1994). Therefore, an individual may use a particular brand to conform to the professional position and another brand to conform to his or her friends during the weekend (Festinger, 1994). For example, a individual may use an Armani suit during the week and may use casuals from Dolce and Gabbana during the weekend.

Hedonic Value is defined as the intangible benefits of a product that forces a consumer to make the purchase decision. These benefits may be of emotional value or could provide a sense of pleasure to the individual (Dubois and Laurent, 1994). Research have shown that the consumption of luxury products have invoked emotional responses such as sensory pleasure and excitement (Roux and Floch, 1996). Therefore, the term luxury evokes an impression that feels extraordinary.

Quality Value is the value provided by the product in terms of its superior characteristics and performance (Vigneron and Johnson, 1999). The quality cue plays the most important role in the consumer's perception of luxury (Roux, 1995). Therefore, the higher the perceived quality of the product the more the chances of making a purchase decision.

In conclusion, the perceived values of luxury can be studies in terms of buying motives (Kapferer, 1998), culture and sociodemographics (Dubois and Laurent, 1993) and life values (Sukhdial, Chakraborty and Steger, 1995) and these values result in the overall perception of the brand which lead to the consumer making a purchase decision.

3.6.1 A Luxury Value Model

In order to overcome a notion that the motives for consumption of luxury brands are not just to display status or to impress other people, Vigneron and Johnson (2004), developed a multidimensional model that indicates the luxury consumption also depends on the functional, financial and the individual utilities of the luxury brand. This framework called as the luxury brand index suggests that the decision making process of the consumers' involves personal (perceived hedonism) and non personal (Perceived conspicuousness, perceived uniqueness, perceived quality) but also depends on the nature of financial, individual and functional utilities of the luxury brand. These dimensions are interrelated with each other.

Fig 3.3: Luxury Brand Index

Source: Wiedmann, Hennigs, Siebels, 2007; Vigneron and Johnson, 2004

Financial Dimension of Luxury Value Perception - The financial dimension constitutes the fiscal characteristics such as price and value (Vigneron and Johnson, 2004). It explains the value for money and whether the product is worth the amount spent (Monroe and Krishnan 1985).

Functional Dimension of Luxury Value Perception - The functional dimension of luxury is defined as the perception the consumers' have about the main advantages of the product such as the usability and reliability, uniqueness and quality (Sheth et al. 1991).

Individual Dimension of Luxury Value Perception - The individual dimension indicates the value the consumer perceives with regard to their personal characteristics such as self identity, materialism and hedonistic value (Vigneron and Johnson 2004).

Social Dimension of Luxury Value Perception - Consumer more often than not purchase luxury brands to satisfy their social status needs (Kim, 1998). Thus the social dimension means the consumers perception of the extent to which the purchase of the luxury brand will satisfy their needs in terms of being recognized by their social group. This perception will help the consumers evaluate the product positively leading to quick purchase decision (Vigneron and Johnson, 2004).

In conclusion, by recognizing the dimensions that have an influence over the consumers' perception of luxury brand consumption will help in catering to the right market.

3.7 Purchase Decision in the luxury goods industry:

3.7.1 Consumer Buying Behavior:

In general terms, luxury fashion is considered as a social phenomenon all around the world. Fashion dressing reflects an individual's identity within a group as well as a in a society as a whole (Janet Bohdanowicz, Liz Clamp, 1994). A person's identity, consumption habit and the symbols associated with the luxury ownership can be affected by the consumer behavior. (Schouten 1991; Slama, Wolfe and Clark 1999; Phillips 2003).Therefore the study of consumer behavior in the fashion perspective becomes vital for the marketers to develop appropriate marketing strategies which will eventually help them in marketing the products (Janet Bohdanowicz, Liz Clamp, 1994). Also, by understanding the consumer buying behavior, the firms will have a fair chance of knowing the consumers the consumer's response to their strategies (By William M. Pride, O. C. Ferrell, 2007).

The consumption of luxury goods can be considered as a high involvement buying behavior as the products are highly priced. Further the involvement deepens because the consumption of luxury products has a prestige value attached to it and the consumers use this to display their status in the society (Dittmar, 1994). Since luxury goods are products that are considered as symbolic goods, they are subjected to social risk which makes the consumer involvement stronger. Moving ahead with the buying behavior, it's important to understand the purchase decision process which eventually a consumer goes through to make the final purchase. The motivation to purchase a luxury product is the individual need for sociability and self expression (Vigneron and Johnson, 1999).Therefore reference groups are the key for individuals' to make purchase decision for luxury products.

3.7.2 Asian Consumer Behavior and luxury consumption:

The AC Nelson's (2007) consumer confidence survey, it indicates that the Asians are currently the most optimistic consumers in the world. The flamboyant culture among the Asians is one of the key reasons for their affinity towards luxury fashion products. They prefer products that are publicly visible which further justifies their glitzy and flashy culture.

Culture plays an important role in characterizing the consumer behavior and their purchase decisions towards luxury fashion products. Consumers in different counties have different cultures (Hofstede, 1980). The collective encoding of the mind that differentiates an individual or a group from another individual or a group is referred to as culture (Hofstede, 2001). The evaluation of luxury and how consumers form perceptions and behave towards products is also influenced by the different cultural norms and beliefs (Rose and DeJesus, 2007; Markus and Kitayama, 1991). Many researches indicate individualistic cultural orientation in the Western countries and collectivistic cultural orientation where importance is given to interdependence in the Asian countries (Lindrigde and Dibb, 2003). Therefore, reasons to secure the luxury products are different in the Asian and the Western countries as each product displays different meaning in the respective societies (Wong and Ahuvia, 1998).

In Asian countries, consumers give more weightage to status and admiration rather than achievement and power as in the Western countries (Schutte and Ciarlante, 1998). Asians tend to procure products that are more visible in public and that have public meanings (Wong and Ahuvia, 1998). According to researches, Asians try hard to fit into groups that are considered to be the higher classes in the society which makes them purchase luxury products that have public meanings and can be publicly displayed. Public meanings are the perceptions of a product which an individual thinks is held in others minds (Schutte and Ciarlante, 1998). Previous studies on luxury consumption confirm that in collectivist societies the consumption of luxury products was more appreciated and socially accepted. In order to fit into the flamboyant group it is very important for an individual to display products that the publicly visible thereby conforming to the group norms (Wong and Ahuvia, 1998).

We can conclude by saying that the Asian consume luxury products in order to satisfy their status needs and to match up to the peers where group members.