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Since the early 1990s, luxury fashion brands have been developing lifestyle brand extensions with the primary objective of increasing sales.迷你倉 But by enhancing customer experiences around the brand, they also aimed to raise brand awareness and address a change in consumer attitudes.This change came as more consumers chose to integrate luxury into their day-to-day lives. Also key was luxury democratisation - designer brands became more sought after by and more accessible to middle-market consumers.Luxury brands started developing accessories and channels that would let consumers access and experience bits or moments of fractioned luxury. They included fragrances, eyewear, costume jewellery - even bookstores and bars.Armani extended its brand into beauty, eyewear and watches through licensing. It then intensified its lifestyle push with the Emporio Cafe, bookstores and chocolates, followed by furniture and home products line Armani Casa, Armani cellphones and TV sets, and finally Armani hotels.Bulgari moved from jewellery and watches to fragrance, eyewear and leather goods, and ultimately to hotels and resorts.For both, the main aim initially was to increase sales, but in the case of their hotels, they also wanted to generate publicity and communicate their brands.Brand dilutionHowever, the move into hospitality might take luxury brands outside their core business and competencies, raising the risk of brand dilution. Those making the move fall into two distinct categories.In the first are fashion designers who decorated an existing hotel. They include Karl Lagerfeld of Chanel fame, France's Sonia Rykiel and Christian Lacroix, US-based Vivienne Tam and Diane von Furstenberg, and Diesel owner Renzo Rosso.These initiatives were not aimed at extending the designers' brands into hospitality. They sought only to convey the designers' taste and aesthetics in the decoration - the hotels mostly kept their own names and identities.The second category includes brands that achieved a real extension into hospitality, either in-house as Ferragamo did, or through joint ventures or licensing, as Versace, Missoni, Bulgari and Armani did.In this category, hotel guests associate the luxury brand name with the hotel business, which could put the luxury brand at risk.Customers might not see why the brand is associated with hotels and could find it inconsistent.Hospitality is mainly about service, and luxury brands are not experts in this field, so they risk diluting their luxury image.Experiential luxuryStill, luxury hotel guests have shown over the past two decades that they are placing increasing value on experience and design, not simply traditional "white gloves" service.They differ from traditional guests, in particular business travellers who still look for a certain conformity and a home away from home. Such guests are well served by longstanding hotel brands such as Four Seasons.However, younger executives and wealthy tourists often favour boutique hotels, such as the Mira in Hong Kong or the Puli in Shanghai. Designer hotel initiatives form a part of this growing trend.Louis Vuitton Moet & Hennessy (LVMH) took a novel approach with Cheval Blanc, a famous Saint-Emilion wine from Bordeaux. After having spent several years learning the art of personalised service at the first Cheval Blanc hotel in Courchevel in France, the group recently announced the creation of an all-new entity, Cheval Blanc Hotel Management.The brand plans to target various dream destinations. A second Cheval Blanc resort just opened in the Maldives.As Cheval Blanc is a prestigious brand, making such a move is less risky for LVMH than it would be for other luxury designers that focus mainly on fashion. Wines and儲存倉hotels have much in common - indeed, for hotels, the food and beverages segment has become as important as rooms in terms of revenue and profit generation.Also, this strategy enables LVMH to become a luxury hospitality player with control over the most crucial aspect: the service and management of its hotels.The icing on the cake is that the Cheval Blanc hotel concept not only provides exclusive, personalised service, but also allows guests to experience a luxury lifestyle enhanced by some of the group's most famous brands. They can enjoy Louis Vuitton and Dior stores, the Guerlain Spa and a gourmet dining experience built around premier champagne brands Krug and Dom Perignon.LVMH's approach confirms that earlier moves by luxury brands into hospitality were relevant and correctly anticipated a change in luxury consumer behaviour. Those consumers who bought prestigious designer products are now looking for luxury experiences in hotels and travel.Threat or opportunity?Do these fashion-hospitality crossovers pose a threat to existing luxury hotel players? Not necessarily, if they can form mutually rewarding partnerships.Bulgari's joint venture with Ritz-Carlton, which belongs to Marriott, allowed Ritz-Carlton to develop affiliate hotels likely to attract a new clientele interested in European contemporary design.Armani partnered Emaar, a real estate and hospitality group from Dubai. Emaar was able to build awareness and create buzz around its other hospitality project, the five-star premium Address Hotels + Resorts brand.Missoni signed a licence with Rezidor Hotel Group, which is behind the Radisson and Park Inn brands, in what is primarily an initiative by Rezidor to enlarge its hotel brand portfolio with Hotel Missoni.In contrast, other hotel groups, such as Starwood, did not need to leverage an existing luxury fashion brand. Even so, St Regis, also from Starwood, encouraged various luxury brands to decorate a suite at its New York property.Guests can stay in a Bottega Veneta, Dior, Tiffany or Bentley suite. Each aligns with the DNA and codes of its own brand and gives an enhanced experience.Further, ingredient co-branding (including rooms, spas, bars and transport) can be a useful strategy for luxury hotel brands keen to leverage the "dream" factor of different brands or designers to enhance and diversify their guest experience. Note the collaboration between the Peninsula and Rolls-Royce.Last but not least, co-branding moves can give hoteliers an edge in negotiations with investors and real estate developers. Reports by The Boston Consulting Group stress that luxury consumers are shifting from simply owning luxury goods to experiencing luxury."Experiential luxury" spending is growing faster than luxury goods ownership, even in Chinese and South-east Asian markets. Also, statistics indicate Chinese, Indian and possibly South-east Asian consumers will travel more.As a result, they will spend more on hotels and experience. Indeed, Asian consumers might be more interested than their Western counterparts are in experiencing the hotel "lifestyle extension" of their favourite luxury brands.Still, the higher the expectations, the greater the disappointment could be. Moreover, the question is often whether the customers will care for a repeat experience. If the hotel experience is too linked to a specific design element or aesthetic, they might be less likely to return.For luxury fashion brands, there is a key difference between creating a profitable hotel business based on customer loyalty and creating a temporary buzz that serves mainly as a public relations and communication tool to enhance brand awareness.The writer is an Executive in Residence at ESSEC Business School.迷你倉最平