Background

The word “luxury” was derived from the Latin root “luxus”, which originally meant extraordinary fascination. Luxury goods, different from the necessities, are classified as dispensable items that often representing the highest quality and lowest quantity and are what everyone is dreamed of but few can possess of (Kapferer, 1997). With feudalism system falling apart and knowledge and industrial system building up, bourgeois society accumulated their assets and showed great interests in luxury goods.

The fact that luxury goods flow in social status hierarchy not only discloses the phenomenon of consuming upgrade (Zygmunt, 2001) but reflects the transition of consumer behaviour among the world. Atwal and Kahn (2008) illustrated the significance of rapid growth of bourgeois in India and they were no longer at a financial distance from luxury goods and were trading up to meet their aspirations.

More and more middle class nowadays engages their salaries in luxury goods to gratify their vanity and sense of superiority. The consumption of luxury goods was acknowledged and conceived as a status seeking and motivated by temptation to impress others (Dubois& Duquesne, 1993) while Vigneron and Johnson (2004) claimed that the consumption of luxurious commodities could be regarded as the mean of self- representation for individuals.

Nowadays, luxury goods advertisement is here to stay. Luxury brand enterprises e.g. LVMH and Gucci Group, have invested more than ten billions NT dollars

annually in the worldwide for fashion magazine advertisement (Vogue, 2008, pp, 68).

Some scholars such as Marx stated that advertisement was always accompanied with the Capitalism, triggering audiences’ false needs toward commodities. However, several previous studies suggested that advertisement exposure is not necessarily leading to purchasing behaviour. In fact, researches demonstrated that advertisement,

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as one of mass media contents, served as many varied dimensions in formulating audiences’ cognition, attitude and behaviour which heavily depend on how the promoted products are portrayed and how audiences read and process the presented messages. Therefore, these studies have aroused my great interest and curiosity about how readers view luxury watches’ print ads. With the aid of textual analysis as well as in-depth interview, the researcher is able to observe those various advertising appeals employed in the advertisement of luxury watches and whether these tactics have influenced or not readers on the way they view the presented messages. Besides, gender differences can be another factor that affects the perception of print ads. The male and the female consumers may react differently to luxury watches’

advertisements featured to discrepant appeals. Whether these tactics can attract or distract consumers’ attentions toward the promoted commodities, luxury watches, and in turn whether increase or decrease the effectiveness of advertisement is a key emphasis of this study.

1.2 Research Purpose

The purpose of this study is to understand how advertising appeals are being

employed within the context of luxury watches via the channel of print ads in several well-known magazines in Taiwan. In the first stage, luxury watch advertisement is being collected from three major magazines in the dimension of both Fashion&

Entertainment, Business& Finance during specific period of time. From March, 2010 to March, 2011 and being analyzed by three coders on the basis of defined advertising appeal technique. In the second stage, these commonly used appeals in the luxury watch print ads have been discovered as well as analyzed and questions are being raised aiming at understanding how different advertising appeals are being expressed

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in the advertisement and also how readers would respond to those advertising appeal tactics through the aid of in-depth interview. The objectives of this study are stated as follows:

1. Arousing readers’ emotions as they are exposed to media content and advertisement is the first goal in marketing communications to make impressions on audiences among all stimuli they received. The first objective is to discuss various advertising appeals, which are harnessed in the luxury watch advertisement.

2. This study is conducted to excavate the presentation of luxury watch advertisement. After analyzing the print ads the researcher gathered, the author found out the advertising appeals are harnessed differently based on the certain promoted watches and brand equity. The third objective is to initially investigate the relationship between advertising appeals and promoted commodities. The author analyzed the luxury watches print ads that are emotionally attached to readers and examined the symbols of meaning embedded on the print ads through textual analysis.

3. Advertising appeals are employed by advertisers to stand out the

promoted commodities among other stimuli. However, the effectiveness of these appeals is questioned since readers’ reaction may be different from what advertisers have expected. Therefore, the fourth objective in the study is to understand how advertising appeals mean differently towards magazine readers while they view luxury watch print ads through the aid of in-depth interview. Thus, the author is capable of comprehending the quality of advertising appeals in the print ads from customers’ perspectives.

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1.3 Research Questions

Research questions are formulated in order to further clarify the purposes of this research and the research framework. Research questions are listed as follows.

- First Stage:

First Stage: We analyze the tactics used in the domain of luxury watches print ads (status appeal, luxurious appeal, celebrity endorsement, functional appeal and etc.) to see how the characters or products are being presented in the advertisement.

RQ1. What are the different elements laid in luxury watches print ads on the basis of discrepant appeals?

RQ2. What are the embedded symbols representing the luxury watches in the print ads?

- Second Stage: We evaluate the way subjects read those print ads through intensive interview.

RQ3. Will the readers identify the symbols of luxury watches through reading the print ads?

RQ4. Whether the interviewees comprehend the token of luxury watch may affect their future recall and attitude on specific luxury watch?

1.4 Research Rationale and Significance of the Study

Luxury goods are here to stay in Taiwan and the amount of sales volume in terms of luxurious products have been reaching higher and higher recently. Most Taiwanese

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are familiar with luxury brands, especially certain well-known brands such as Louis Vuitton and Gucci, and the concept of consumer behaviors in the aspect of luxury goods is also widely accepted. As mentioned, more and more international luxurious manufactures have arrived in Taiwan, attempting to grasp some market share of luxury goods. Since the competition has become fierce, luxurious manufactures started to pour their budgets in the advertisement so as to reinforce consumers’

condition, formulate attitude and conduct behaviors. Instead of taking a high road and putting advertisement in the new medium platform, most luxurious cooperation depend on the print ads in the magazine because of prior studies indicating the target customers tend to access needed information about luxury goods via this channel.

However, although there is an array of academic literatures investigating the strategic use of advertising appeal in high end products, limited study has been conducted to deeply excavate how these luxury goods print ads work when readers expose themselves to the presented information. It is conceivable that there are tactics and appeals to harness when it comes to catching the eye of viewers to stand out the promoted products in everyday visual competition. In this study, the researcher would see how the luxury watches are portrayed from the print ads in several magazines.

What are those tactics or the appeals the advertisers employ interest me a lot.

In addition, the author also intends to know whether the presentation of

promoted product in the advertisement has influenced viewers on the way they read the luxury watch advertisement or not. Subjects’ comprehension toward luxury

watches may have great on their future attitude. Through intensive interview, it allows researcher to understand if or how much the most important information, feature has been conveyed to the readers. Take functional appeal or celebrity endorsement as an illustration. Most luxury watch manufactures are inclined to use the tactics of advertising appeal to attract viewers’ attention in the print ads. The former is able to

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elicit the unique features of one particular watch; the latter is capable of associating positive attitude with new-coming watch or brand itself with the aid of

correspondence inference. Nevertheless, questions are raised to observe whether subjects neglect the detailed description in which it is located in certain position in page layout or whether people spend more time appreciating the celebrities than luxury watches. Besides, whether readers’ process presented messages carefully and what kinds of psychological reflections are raised interest the researcher. These phenomena are likely to increase or decrease the effectiveness of the advertising. In addition to various appeals used in the ads, gender differences can also be another crucial variable to explain how people recall and project attitude change to the luxury watch advertisement differently. This study can answer the aforementioned

speculations and facilitate us to know what readers see the luxury watch advertisement with the execution of textual analysis and in-depth interview.

CHAPTER II

Literature Review

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The literatures with regard to luxury goods advertisement as well as the application of customers’ perspectives are rather immense. Some of researches analyzed and

decoded the presentation of luxury goods in the print ads and discovered the similarities and differences among these luxury goods advertisement. Other

researches emphasized the psychological aspect of each consumer and found out how these advertisements influence consumers’ cognition, attitude and behavior. This study attempts to probe into the interrelationship between the advertisement with certain advertising appeals and how the viewers read the advertisement. Therefore, the literatures are reviewed and are divided into five facets: the past and current state of luxury goods market in Taiwan, the analysis of luxury watches advertisement, readers’

information processing, the origins of commonly-used advertising appeals, the effect on customers after exposed to advertisement.

In the first section, the researcher would describe how the luxury goods market has been booming for the last few years and mention the two well-known studies, which aim to decode the meaning or symbols in the luxury goods advertisement and see how the image of luxury can be conveyed in various ways. The author would also disclose the most well known domains of dual process model and certain aspects that will influence magazine readers’ cognition, attitude and behavior. Later on, the author would explore the frequently harnessed advertising appeals in the advertisement and how these tactics work to make good impressions on target customers via advertising arousal. Then, the researcher would further elucidate prior studies regarding

discrepant effects of media exposure on distinct processing engagement.

2.1 Current Environment

2.1.1 Selling Reports Regarding Luxury Goods in Taiwan

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Even though Taiwan is just a small island (35,980 km²) with population of

twenty-three millions people (2010, Ministry of Interior), it has always been playing a prerequisite role when it comes to the luxury goods market. With the rapid growth of Information Technology industries and enhancement of international trade, the economic growth in Taiwan had been tremendously significant in the year of 1990s.

The population of middle class in Taiwan had been increasing within several years, and the consequence of their raising income and financial flows have reflected the sales reports in luxury goods market. According to the report of Moet Hennessy Louis Vuitton (LVMH Group) in 2002, Taiwan was ranked as the top fourth market, standing for 2.2 billion NT dollars, for Louis Vuitton around the world (Albatross, 2010). As for the luxury Jewelry and watches, the revenue in Taiwan has also constantly stepped up.

Taiwan was regarded as one of the top ten largest markets in terms of Cartier’s jewelry and watches lines in the year of 2004 and 2005 (Fashion Guide, 2005). Cartier’ Trinity Ring and Love Bracelet were seen as extremely hot items and act as a token of

affection and wealth. According to the official report in Switzerland, Taiwan market in 2004, ranked as thirteenth, accounted for 1.8% of the entire Swiss-made watch

manufactures’ revenue and it represented approximate 8.5 billion NT dollars. In fact, one of Swiss luxury watch brands- Vacheron Constantin, established in 1755,

discovered Taiwanese consumers’ purchasing potentials and provided exquisite and exclusive services for the top of pyramid consumers. In 2006, Taiwan was the second largest market for Vacheron Constantin. Besides, the same phenomenon can be reflected to Georg Jenson, the market in Taiwan had accounted for approximately 10 percent of entire market around the globe and was evaluated as the second largest market followed by Japan for Georg Jenson. Another French jewelry brand, Bouchern, ranked Taiwan as the third market in 2006. To the company’s surprise, there was only

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one store in Taiwan, located in the capital of the country- Taipei, but the store’s annual sales reached more than 4 hundred million NT dollars.

From the numbers of evidences and data mentioned above, Taiwan’s domestic needs and purchasing index has been significantly booming especially for luxury goods such as sophisticated watches and limited jewelry. What’s more, these presented selling reports reveals contemporary luxury goods market in Taiwan during 2005-2006 when market focused on the domestic needs. Nowadays, with the transformation and democratization of political as well as diplomatic policies, frequent interactions and interflows between Mainland China and Taiwan have echoed the consensus of

“facing-up the reality, mutual non-denial, working for the benefit for people and cross-strait peace” (Romberg, 2009) recently. Cross-strait relationship has been enormously improved which can in turn stimulate Taiwan luxury goods market because of considerably visitors from China coming to Taiwan and consuming products. Therefore, the ministry of economic affairs, R.O.C (2010) suggested that more than 40 percent of luxury goods sales in Taiwan would be contributed owing to people from Mainland China.

2.1.2 Academic Researches for Luxury Goods Buyers in Taiwan

However, the luxury goods market had already been quite matured and cultivated for years and younger generations in Taiwan, at the age of 18-30, enjoyed aesthetic experiences in exposing themselves to the luxury goods ads and more than 73 percent of population had possessed luxury (defined as items that were worth of more than 15,000 NT dollars) hand bags, watches or jewelry either by themselves or from others (Zhan, 2006). Taiwanese, particularly people aged 25-40 are acquainted with luxury goods advertisements and more willing to spend their money on luxurious products

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(Chen, 2004) than we had expected. The stunning sales reports and high revenue in Taiwan luxury market impressed Luxury manufactures and therefore attracted more companies to Taiwan and compete over each other. Due to the fierce competition in the luxury goods market, each luxury goods manufacture increase their marketing budgets in Taiwan and their advertisement expense has reached about 3.2 billion NT dollars (jewelry and watches were 7.8 hundreds of million NT dollars) and print media accounted for 62 percent of total luxury goods advertisement expenditures (Nielson, 2005; Taipei Association of Advertising Agency, 2005). Under this

circumstance, readers are more easily being exposed to luxury goods advertisement, which may directly or indirectly enhance their cognition and brand recall in terms of luxury goods. Moreover, Chen (2004) claimed that the value, self-centered

perspective, commonly held within the individuals in the Generation Y was apparently distinct from older generation which mainly conducted purchasing behavior on the basis of needs of family or others first and this existing discrepancy was likely to result in attitude to behavior change in terms of purchasing luxury goods.

Besides, peer pressure and group conformity, for undergraduate or graduate students in Taiwan, can be other key factors to elaborate why young adults considered

purchasing luxury goods to be a common behavior or even a routine (Chung, 2008).

Chung’s study indicated that young adults in Taiwan were primarily influenced by peer (friends/ class/workmates or siblings) and media content when it comes to perceiving luxury goods purchasing intention. Chou (2009) further explored a phenomenon in Taiwan through an aspect of sociology, positing the fact with the establishment or formulation of reference groups and consumer tribe, the luxury consumption may be a regular pattern, constant ritual in one’s community.

2.2 An Analysis of the Content in the Luxury Goods Advertisement

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Even though the advertising expenses or budgets have been distributed not only just for traditional media such as newspaper and television but for alternative media, e.g.

the Internet, the magazine channel is the principal means for consumers to access content or information in the aspect of luxury goods. Albatross, one of professional luxury goods survey agencies, conducted the China luxury forecast report in 2010 and the finding asserted traditional print media continued to be an effective channel for luxury goods consumer in China (including Hong Kong and Taiwan). Luxury goods companies put more than 60 percent of their advertisement and marketing budgets in print media and more than half of consumers access the coming release of luxury goods via the channel of magazine in spite of the emergence of Internet advertising (Albatross, 2010). Magazines provided a short cut for advertisers to reach a

well-defined segment of people that shared similar consumption-related symbols (Terpstra& David, 1991). Several studies (de Mooij, 2003; Nelson& Paek, 2007) have been conducted and claimed that the dimension of fashion and beauty was relatively culture-free compared to the products categorized as necessities, such as food, which were always supposed to take social and culture value into consideration, and

therefore companies in these industries were inclined to employ standardized print ads in the global context. Downplaying culture-specific content, the images portrayed in luxury goods advertisement were similar or even identical because of shared

consumer traits, such as cosmopolitan and the strong motivation to grow into

members of global village. In addition, Harris and Altour (2003) discovered that more and more media as well as marketing campaigns are not only partially standardized but also fully standardized after the analysis of content of the magazine Cosmopolitan across six different nations. Moreover, the benefits of multinational images and low-cost rendered luxury goods companies spend less marketing resource in terms of

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producing unified appeals (Zhou and Belk, 2004; Levitt, 1983). Levitt further pointed out the appearance of global marketing strategy not just in the context of luxury goods but other commodities as the world’s preference structure was homogenized step by step. With our local culture becoming globalized, a marketing plan was commonly employed in all the countries where it operated.

In addition to the analysis implying luxury goods ads being less tailored for each culture, other researches investigated how the image of “luxury” emerged as readers exposed themselves to certain content. Through the immersion of atmosphere and imaginary experiences created within the luxury goods advertisement, viewers or readers are likely to accomplish sensorial pleasure and intertwine the real and virtual lifestyle together (Chou, 2009). The projection of luxury is highly associated with exclusiveness and self-assure lifestyle and the main purpose for advertisement is to sell dreams within brand culture as a marketing strategy (Brioschi, 2006). Gradually, viewers or potential consumers are deeply involved in the process of mutual defining and creating value, and the co-created and co-sharing experiences would become the

In addition to the analysis implying luxury goods ads being less tailored for each culture, other researches investigated how the image of “luxury” emerged as readers exposed themselves to certain content. Through the immersion of atmosphere and imaginary experiences created within the luxury goods advertisement, viewers or readers are likely to accomplish sensorial pleasure and intertwine the real and virtual lifestyle together (Chou, 2009). The projection of luxury is highly associated with exclusiveness and self-assure lifestyle and the main purpose for advertisement is to sell dreams within brand culture as a marketing strategy (Brioschi, 2006). Gradually, viewers or potential consumers are deeply involved in the process of mutual defining and creating value, and the co-created and co-sharing experiences would become the