The Value Proposition of Luxury Brands

lemko

Hyundai doesn't seem to be recognized as a luxury car by most of the public. I saw an Azera at lunch time and the owner pried off all the swoopy "H" badges and replaced them with aftermarket badges with some fussy filligree in them. It was as if the owner was ashamed to be driving a car badged as a Hyundai.

ctl

I think the prestige of a brand can be objectively defined as the weighted average of its car selling prices in a region (say NA, Europe, Japan...)

WAP (weighted average price): say brand BR sells 100 car A at $20K, 100 car B at $30K, then the WAP for brand BR is (20K * 100 + 30K * 100)/(100+100) = 25K

With that, we can easily rate the brand prestige in the NA market:

Tier 1: Rolls-Royce, Bentley, Maybach, Ferrari, Lamborghini...

Tier 2: Porsche, Mercedes-Benz, BMW, Audi, Lexus...

Tier 3: Toyota, Honda, Nissan, Hyundai...

The more high priced cars a brand sell, it increases its brand prestige, and vise versa.

Equus and Genesis certainly increases the brand prestige for Hyundai, quantitatively. But selling lots of Accent/Elentra would means the Hyundai brand can never have a high WAP.

And what's a good value? maybe low car price for a high WAP brand?

stickguy

I assume you would put Acura and Infiniti into tier 2? And probably Volvo and caddilac also?

hpmctorque

I agree with everything, except careful with the champagne in the trunk in suit happy America.

Mr_Shiftright

Okay then, a subscription to CIGAR Magazine.

ctl

This (WAP) being an objective measure, where a brand is ranked wouldn't depend on my personal feelings too many brand to list, but not hard to estimate where they are.

This also imitate how our brain perception works. I think in most cases, when a brand is mentioned, the WAP score will be the first to surface. Also, for most people it takes a while and drastic changes for our brain to change the WAP perception...

I assume you would put Acura and Infiniti into tier 2? And probably Volvo and caddilac also?