The impact of a recession on the marketing of luxury goods in South Africa

Abstract

This study seeks to understand the impact of the recession on the marketing of luxury goods (specifically cosmetics and fragrances) in South Africa. This was determined through a literature review that covers the luxury industry in general, the luxury market in South Africa, and the recession itself. The marketing mix for luxury brands in South Africa was used as a point of reference. Research was conducted with a targeted group of marketing managers of different luxury and premium cosmetics and fragrances brands in South Africa. Owing to the limited pool of respondents, the sample included marketing managers from other luxury product categories and representatives from the advertising agencies who work with some of these brands. The results of the study showed that prior to the recession, most of the respondents employed mostly above-the-line programmes. However, the recession forced them to work with reduced budgets, but it also revealed a growing trend in the luxury industry towards more customer-focused marketing programmes. The unique South African market may have some influence on the actual luxury market, but it does not necessarily affect the actual marketing of the brands. Below-the-line elements such as the counters in stores were deemed as being central to the success of the brands. Based on the findings, a set of recommendations was compiled. In addition to this, further areas of research were identified, and these could provide supplementary benefits for the market.