{"id":22221,"date":"2025-04-29T14:05:21","date_gmt":"2025-04-29T14:05:21","guid":{"rendered":"https:\/\/mysourcefunding.com\/?p=22221"},"modified":"2025-04-29T14:05:22","modified_gmt":"2025-04-29T14:05:22","slug":"when-tariffs-hit-how-do-luxury-brands-convince-consumers-to-spend-even-more","status":"publish","type":"post","link":"https:\/\/mysourcefunding.com\/?p=22221","title":{"rendered":"When tariffs hit, how do luxury brands convince consumers to spend even more?"},"content":{"rendered":"

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Some Chinese manufacturers on TikTok may have just started using Trump\u2019s tariffs as an excuse to peddle $2 wholesale \u201cLouis Vuitton\u201d bags. But Jhara Valentini has been prepping her luxury clients on how to market during a trade war since last August.<\/p>\n

Valentini is the founder and president of Valentini Media Group, an agency whose clients have included Louis Vuitton, the lifestyle brand Goop, and Watches of Switzerland, a seller of brands like Cartier, Rolex, and Patek. Luxury clients bring a wealth of unique consumer behavior data, and their consumers have more drawn-out customer journeys, she told us; high-end brands also often have more variable long-term goals, like engagement and awareness, rather than performance-based KPIs. That is key to how she plans to advise them on navigating the tariffs\u2019 effects, which are levying extra costs on imports from countries central to the luxury sector\u2019s manufacturing and inventory processes.<\/p>\n

\u201cLuxury is very atypical,\u201d Valentini said. \u201cI think luxury and heritage and that value perception is going to be the biggest narrative.\u201d<\/p>\n

We spoke with Valentini about how tariffs are already affecting luxury brands, and how she\u2019s counseling her clients through a turbulent time.<\/p>\n

This interview has been edited and condensed for clarity.<\/em><\/p>\n

Explain it to me like I\u2019m 5. How are tariffs affecting the luxury sector, and in particular, the brands that you are working with?<\/strong><\/p>\n

My husband and I were actually having this conversation with our kids\u2026So I structured it around a math problem. At the end of the day, especially with [luxury\u2019s] efficiency and lower funnel-conversion tactics, margin is your main play, because at the end of the day, margin impacts your profitability. Profitability is when you\u2019re winning. Even if you have a double-digit return on investment, if the margin isn\u2019t there, then you really didn\u2019t make any money\u2026The margin number is obviously going to be dependent on the location\u2026That\u2019s probably the bigger [conversation] within our client set, because we have Europe, Swiss, domestic. There\u2019s so many different variables. Some stuff we do monitor and oversee global distribution, others we only oversee domestic distribution. So how does that margin look regionally? What\u2019s the profitability tactics for each region? They always vary, obviously, but now it\u2019s a much bigger conversation and more pertinent conversation, depending on where the inventory is coming from and what specific tariff number that has.<\/p>\n

When you\u2019re thinking about how the tariffs are affecting these profit margins, how is that affecting messaging, especially for luxury brands?<\/strong><\/p>\n

It\u2019s almost like a two-pronged approach. We have our immediate tactics that we\u2019re optimizing into, and then that long-term play. In the immediate, luxury is seeing a surge. We\u2019re seeing conversions go up. In conversion value, we\u2019re up almost 200%. Since the tariff news, consumer cost per acquisitions are down, we\u2019re almost down 16% on average. So we\u2019re seeing a really nice lift. But it also makes sense people are taking advantage of the prices now, because we know they\u2019re going to go up later\u2026Long-term, the play is really going to be storytelling and leaning into heritage, value, context, and that \u201cwhy\u201d component. The luxury consumer, I think, is going to be much more inquisitive and open to information and education about the products that they\u2019re purchasing\u2026So how can we parlay that into a marketing strategy and conversation that makes sense, that\u2019s digestible, and that\u2019s consistent? The biggest thing that we\u2019re trying to advocate across every channel is consistency of messaging. Because if you\u2019re safe within your messaging, and you\u2019re consistent with it, and that value is always there throughout every touchpoint, pricing doesn\u2019t become secondary, but it\u2019s an easier conversation to navigate because the perception of value is there.<\/p>\n

Has luxury always leaned into a little bit of education, or is that a direct result of the tariffs?<\/strong><\/p>\n

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It\u2019s always been part of the arsenal, because that\u2019s where that value perception lies. There\u2019s a reason why there\u2019s so much content around how a Birkin is made, how a Patek Philippe Ellipse watch is made. All of those pieces of information give that product item the value it deserves\u2026I think now, because of the conversation that\u2019s happening, I think [people are] going to be a lot more open to engagement with it.<\/p>\n

Tell me a little bit about how tariffs are reshaping pricing and product flow in luxury, and then how luxury brands are also adapting their paid media strategy as a result.<\/strong><\/p>\n

Nobody\u2019s scrambling yet. However, we are being so much more intentional when it comes to existing inventory, new inventory, where that inventory is coming from, and the concern around the pricing\u2026From the client side, there\u2019s definitely conversation and concentration around inventory that\u2019s tariff-insulated. Things that won\u2019t get affected so much [are] things that are already in-market, things that are already here. How can we leverage that inventory? What can we do to make sure that that inventory sells? And then [we are] figuring out that path to make sure we have enough inventory in the States as soon as possible to offset anything that\u2019s going to happen.<\/p>\n

The other thing that I\u2019m planning for\u2026[is] at the end of the day, your end-of-year numbers are what the big conversation is, so we\u2019re front-ending like crazy. Any type of opportunity and optimization tactic that we can lean into right now to sell product, especially while surges are high, we\u2019re taking advantage of completely to help offset any kind of diminishing returns or things that are happening later in the year.<\/p>\n

And then our long-term planning for Q3 into Q4 is always setting up the next year, but I\u2019m looking at the next three years. What are the brand advocacy programs that we can set up? What does customer lifetime value look like right now? What is that going to look like in six months? How can we make sure we retain that consumer through this experience, because it is going to be very fragmented?<\/p>\n

People are going to have feelings. Feelings are going to be felt, and there\u2019s going to be so much fluctuation. My goal is to keep that consumer loyal, to keep that consumer happy and educated, and [keep] that value perception strong. That means incorporating a lot more branding plays, and also working with owned and operated channels that don\u2019t cost money. So newsletter, organic, organic social, SMS, whatever kind of delivery method we can use to just maintain that consumer and keep that education and perception value high we\u2019re pushing into, and then wherever we can, tap into that tariff-insulated product inventory.<\/p>\n

Is this something you have ever done before, preparing three years into the future for essentially an entire presidential administration?<\/strong><\/p>\n

I don\u2019t plan around presidential elections, but I usually plan around a three-year flight\u2026Especially with luxury, because the path to conversion is long\u2014I mean, we\u2019re talking [about how] sometimes pieces can be between $100,000 and $200,000\u2014sometimes it\u2019s at a six-week program or an eight-week program, but it\u2019s that heritage value perception that we\u2019re trying to set up. So I do typically work and think very future-forward, just because I have to anticipate media changes so much. It\u2019s almost naive to be like, \u201cWhat we\u2019re doing today is what we\u2019re going to do tomorrow.\u201d Tomorrow can implode on us, so we have to plan ahead, especially this year.<\/p>\n

Correction 04\/23\/2025:\u00a0This story has been edited to clarify a quote.<\/em><\/p>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Some Chinese manufacturers on TikTok may have just started using Trump\u2019s tariffs as an excuse to peddle $2 wholesale \u201cLouis Vuitton\u201d bags. But Jhara Valentini has been prepping her luxury clients on how to market during a trade war since last August. Valentini is the founder and president of Valentini Media Group, an agency whose […]<\/p>\n","protected":false},"author":1,"featured_media":22222,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[78],"tags":[],"class_list":{"0":"post-22221","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-marketing"},"yoast_head":"\nWhen tariffs hit, how do luxury brands convince consumers to spend even more? | Brandiary<\/title>\n<meta name=\"description\" content=\"Some Chinese manufacturers on TikTok may have just started using Trump\u2019s tariffs as an excuse to peddle $2 wholesale \u201cLouis Vuitton\u201d bags. 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