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INTRODUCTION
On 26 March 2008, the news was confirmed: the prestigious luxury brand Jaguar, along with the mythical brand Land Rover, were sold to the Indian conglomerate Tata, which had just announced some months earlier its own launch of the cheapest car in the world. The price paid by Tata for both brands (2.3 billion dollars) was half of the price paid by Ford in November 1989 (5.2 billion dollars), and several billion dollars have been invested by Ford during those 9 years. This demise of Ford Corporation in rebuilding a profitable Jaguar is intriguing: all modern techniques of industrial management had been applied to Jaguar (re-engineering, re-focus on quality, and so on). Modern marketing had also been introduced in the management of this brand to make it more competitive and attract more consumers. In the automobile industry, critical size is a determinant factor of profitability, and Jaguar brand extensions were launched to reach this critical size in volume. Despite the introduction of marketing, or maybe because of it, Jaguar sales dropped from 130 000 to 60 000 in 5 years.
In fact, all over the world, in most Luxury Groups, marketing is introduced fiercely: experienced brand managers, typically MBAs, well trained in classic marketing at Procter and Gamble (P&G) or Johnson & Johnson, are hired to promote their methodologies within the management of luxury brands. This is the beginning of the problem soon faced by these brands. Certainly, most luxury brands do market products that themselves are not luxury products: these trading-down extensions aim at leveraging the prestige of the name they carry in order to harvest the royalties of, say, masstige fragrances, eyewear, accessories, and so on. In these segments, classical marketing does apply, by bringing efficiency through methodologies and techniques inherited from mass products (segmentation, positioning, pre-testing, surveys of consumers' desires and expectations, benchmarking, and so on). They have an allure of luxury but are not luxury.1
The current problem is the growing extension of these classical marketing techniques to the core business of luxury brands. Extant approaches are simply not working: Jaguar, Calvin Klein or Cardin are some of the examples of this. Jaguar has never been profitable, although its perceived quality had been remarkably upgraded by Ford, as indicated...