Paid Media Strategies for Luxury Brands - Targeting A High-Net-Worth Audience

Paid media in the luxury space is notoriously difficult, from justifying formats & channels to building the most granular audiences to competing with wholesale customers - this guide is designed to provide suggestions and best pracices around targeting high-net-worth individuals for premium brands.

JOSH DUGGANby Josh Duggan 9 April, 2020

Paid media is a notoriously sensitive area for luxury brands selling online, as a result of key stakeholders being cautious with the brand, reliance on wholesale channels and concerns around brand representation with content being sponsored. With this in mind, we decided to put together an article focused on how luxury brands can prove the concept and also target key audience segments in a very considered way.

Self Portrait Store

When we think about luxury brands, we think exclusive, niche, not for the masses. A luxury brand’s target audience can be easy to define but hard to reach, they require advertisers to understand their high-net-worth segment, and create customer profiles based on not only this, but also on other consumer demographics. So, in the world of online digital, how can we apply this to our online marketing campaigns? 

Online tools are getting better and better at helping brands connect with the right audience and over the last few years most large publishers and technologies have focused on improving their targeting capabilities Looking at media in general over the last 10 years - it was historically purchased with little audience data. Advertisers would buy media based on the content being served e.g. serving running trainers against running and health content. The marketing world has shifted to an audience led approach with almost all platforms and technologies building out their audience targeting capability. A clear example here is Google, which have shifted massively away from simply keyword targeting to ever increasing audience led targeting options. This ranges from demographic, household income (US), in-market interests, lookalike modelling and more sophisticated CRM strategies with email lists. 

Here are just a few ways in which luxury brands can apply these to maximise their marketing efforts.

Audience targeting capabilities within key advertising channels

Google ads

Google has made huge strides in providing advertisers more and more access to consumer interests and developing their platform for better targeting. Here are some of our favourites.

Overlay Google’s in-market and affinity audiences 

Within the Google ad’s platform, you can overlay audiences based on a user’s passion, recent purchase intent, life events or detailed demographics. By overlaying audiences across your generic search campaigns, you can bid higher for a user who is a closer match to your customer profile.  For example a user may be searching for ‘leather boots’ but the user we are most interested in is somebody who is looking to buy leather boots, but is also a luxury shopper, a female, and between 25 and 35. We would therefore bid higher for this audience. We can also switch this around and apply a minus bid modifier for a user which is less of a match to our target audience. 

Another RLSA strategy (remarketing lists for search ads) would be to target only these audiences with your activity. This might mean bidding on the broader term boots, however only serving ads to females aged 25-35 who are luxury shoppers. 

Create custom affinity and custom intent audiences (Display and video)

Outside of Google’s defined audiences, you can combine keywords and URLs (Custom affinity audiences) to create an audience which is more tailored to your brand. For example, an advertiser may position itself in the market as a sustainable fashion brand, therefore may create a list of keywords around ‘sustainable fashion’, ‘sustainable products’, ‘Eco-Friendly Clothing’, ‘Sustainable Fabric’ in addition to urls of websites related to these categories i.e. https://www.sustainablefashionmatterz.com/. Custom intent audiences work in a similar way, however the focus is more on reaching users based on their recent purchase intent, rather than interest alone. 

Build out negative lists which can easily be applied at an account level 

At a very basic level you can build out a negative list at the very start of a campaign to exclude users based on the language they use in their searches. For example, a user searching for boots with the phrase ‘cheap’ ‘deal’ ‘voucher code’ or ‘discount’ are likely to be outside your target demographic. 

Overlay your first party audiences

First party audiences are the most valuable any advertiser can have, and the most effective at reaching the right audience. Luxury brands can harness their first party data to reach users based on their past purchase and browser behaviour. The most obvious is Google analytics, by creating audiences based on products views, added to cart, purchase, AOV. This can be taken further by overlaying recency i.e. a user who added products to their cart a day a go may be more likely to go on and purchase rather than a user who did so a month ago. In Google ads you can overlay these audiences in your Google campaigns and apply bid modifiers to bid higher/ lower for these audiences when they search for your given keywords, or create remarketing campaigns to bring users back to site.  You can expand your 1st party data by also including YT data and users who have previously engaged with ads for example. 

Upload your customer lists

Customer lists take first party audiences a step further. Luxury brands have rich customer databases which can be segmented based on their most engaged and affluent customers. These lists can be uploaded into Google ads and are matched to signed in users on Google. You can then create Search, YouTube and Gmail campaigns to target these audiences with your specific messaging.

Similar audiences

You can also create similar audiences from your customer lists & analytics audiences. This way you can find new users who have similar interests to your current purchasers and website visitors. 

Facebook & Instagram

One of the biggest question marks for luxury brands seems to be around advertising on Facebook and Instagram, with brands generally seeing these as key channels for engaging with audiences and there being a reluctance to output sponsored content alongside this. Over the last few years though this has changed and most luxury brands are able to justify these channels as an alternative to less measurable and less controlled channels (particularly vs offline marketing). Luxury brands such as Dior, and Burberry are examples of those really pushing campaigns via social.

Whilst Search is well-known for keyword-based targeting and has developed their platform to be able to apply audiences, Facebook has always been an audience led advertising platform. The multiple data points they have on their users mean it has a rich understanding of user demographics and interests which advertisers can take advantage of. Across both Facebook and Instagram, we would recommend testing a combination of the approaches below. 

Customer lists

Upload email lists of users based on their purchase history (as well as other variables around behaviour and any other data points) for re-engagement.

Look-a-like audiences

Create audiences with a seed list, i.e. previous website visitors/ customer lists to find new users which share similar interests. 

Facebook audiences

With Facebook audiences you can create prospecting campaigns based on interest, demographics and behaviour. In the example of a luxury fashion brand you could target users who are women, between 25 and 35, who are interested in Fashion and style or shopping and fashion, but must also be interested in luxury goods or sustainable fashion. This allows us to qualify the users who fall into the audience pool to ensure they match our target audience.

Facebook audience Insights tool

Using the Facebook Audience Insights Tool, you can gain a more granular level of understanding of your target audience such as age, gender, interests, location and even what device they are using and more. You can then create advert sets based on these factors to reach a new audience.

Key Recommendations for targeting High-net-worth individuals through paid channels

  • Ensure broad activity (generic keywords and broad interest targeting) are overlaid with targeting which refines targeting to higher value consumers. This may include overlaying postcode targeting (for more prosperous areas), over-laying job targeting, luxury interests and interests in other luxury lifestyle brands.  

  • Including price and  messaging to qualify consumers to reduce wasted costs from irrelevant traffic 

  • Building out more sophisticated CRM lists to ensure you are reaching higher value customers, potentially excl. those who buy during sale for example

  • In addition to messaging - luxury brands should be building their brand through luxury content and creative. A lot of brands in both search / shopping and social will use product shot imagery with strong CTA messaging and discount / sale messaging.   

  • Luxury brands should really be pushing content which is relevant and interesting to consumers. The creative as well should be much more attractive and engaging than simply product imagery in a carousel. Instagram stories are one of the easiest formats to build from a creative perspective and these offer a great opportunity for brands to really reinforce their luxury image.

  • Another nice example is the Canvas ad format here. This is a full screen ad experience which is an amazing way to build engagement with consumers.

If you have any questions on justifying paid media for luxury brands or even just examples of campaigns, please feel free to get in touch. You can also find out more about our paid media services for luxury brands here.

JOSH DUGGAN
Josh Duggan
Josh is a Director at Vervaunt and he runs the paid media offering. Josh has worked for a host of large media agencies and has managed paid campaigns and strategies for some of the biggest brands in the world.