Neiman Marcus Builds Brand Via ... YouTube?

Luxury Retailer Takes Over Site's Front Page to Show Consumers Its Hipper Side

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What is one of the country's most high-end, trend-right department-store brands doing on a site best known for laughing-baby videos and teenage webcam musings? Oh, just building its future customer base.
Brand Identity
Not all video watchers are teens
Neiman Marcus chose to market its style savvy to YouTubers, who turn out to be a bit older and wealthier than the typical web surfer.
YouTube Demographics
Source: ComScore

Neiman Marcus is taking over the YouTube home page today to promote its 100th anniversary via a video showing off the store's style savvy. If YouTube and the upscale department store best known for catering to the ladies-who-lunch crowd seem a bit of an odd couple, it's understandable. Even Neiman executives admit it's an unorthodox move, but they think there's a place for their luxury brand on the video-sharing site.

"Like with anything, you hear people in meetings say, 'Did you see the thing on YouTube?'" said Ginger Reeder, VP-corporate communications at the Dallas-based retailer. "And if it starts to permeate our consciousness, we can only assume it's in our customers' as well."

YouTube does, of course, have scale -- important for a marketer promoting an original piece of branded content. Despite a raft of competition from MySpace, Facebook, portals and start-ups, YouTube is still the largest video site, commanding more than 21% of all online-video views, according to ComScore data for May, the most recent month for which the data were available.

And other fashion-focused companies have found success on YouTube; Ford Models distributes original video on the site and has become YouTube's 68th-most-subscribed channel.

Neiman Marcus is owned by a private-equity firm that plans to take the company public. A key to continuing its impressive growth will be fostering a younger clientele. It already has launched a series of Gen-Y-targeted stores called Cusp, which has a blog but no e-tail presence yet. Executives say YouTube is another way for the company to prove it's not too sophisticated or staid to have fun.

The luxury market's always a moving target depending on which generation of people is moving through its affluent period. Neiman Marcus, through its YouTube buy, is "making a concerted pitch, strategic pitch to young people to say, 'We're not your grandmother's store -- we're your store, too,'" said Pam Danziger, founder of luxury consultant Unity Marketing. Young affluents are 40 and under; she suggested the luxury market is going to undergo a generation shift as significant as the one in the late 1980s and early 1990s, when the boomer generation grew into affluence.

Wealthier audience
It turns out YouTube isn't such an odd place for a luxury or high-end brand. The site indexes higher both in people ages 35 to 54 and in high-income households than the general internet population, according to ComScore data. While 23.4% of internet-connected households make more than $100,000, 24.8% of households in YouTube's audience do. And while 38.8% of the general internet population is 35 to 54 years old, 44.2% of YouTube's audience falls into that age range.

The company hired Dallas-based production firm ReelFX to produce the film, which features designers, former associates and Neiman Marcus executives talking about the company and what its legacy means for fashion. It will show the video in Europe during the Paris show as well.
Happy anniversary: Neiman Marcus celebrates by buying YouTube's home page.
Happy anniversary: Neiman Marcus celebrates by buying YouTube's home page.

Buying the home page on YouTube for a day generally costs about $250,000, according to media-buying executives familiar with the pricing. (Neiman wouldn't comment on what it paid for the deal.) The retailer also bought ads around its centennial across Google's network.

The decision to memorialize the store's anniversary via online video comes after a realization that the retailer's website was turning into more than just a place to shop.

"What people really wanted to see is merchandise," Ms. Reeder said. "But they're also looking to us as what's hot, what's trendy. One way to get that across is through video, so we've posted those videos on YouTube. You can see them on our site, but you may have a whole other audience that sees them on YouTube."

The videos aren't getting much play by YouTube standards -- all have fewer than 1,000 views. But it's enough to encourage Neiman to do more on the site. Some marketers have been reticent to make run-of-site ad buys on YouTube, but the home page is considered a safe, "well lit" area on which to advertise since YouTube controls what kind of content appears on it.

That a retailer such as Neiman Marcus is tapping YouTube "is a sign that the media landscape has fundamentally changed for marketers," said Suzie Reider, YouTube's head of ad sales, via e-mail.

For Neiman Marcus, the internet continues to grow as a sales channel. While the retailer has always had a strong direct-marketing business through its catalog, today online sales account for two-thirds of it, while the catalog sales account for one-third.
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