Massification

Massification is a strategy that some luxury companies use in order to attain growth in the sales of product. Some luxury brands have taken and used the concept of massification to allow their brands to grow to accommodate a broader market. As a method of implementing massification, companies have created diffusion lines. Diffusion lines are an offshoot of a company or a designers original line that is less expensive in order to reach a broader market and gain a wider consumer base. Another strategy used in massification is brand extensions, which is when an already established company releases a new product under their name.

Some luxury designers and companies will create a diffusion line to reach a broader consumer audience. A Diffusion line is when a designer will create another separate line of merchandise up for consumption at a lesser price. Diffusion lines have varying ranges and purposes; to increase sales, broaden range of consumers, and increasing demand for product.

Diffusion lines have four stages of market development: wholesale channels to department stores; the creation of ready-to-wear flagships; large diffusion flagships; the opening of stores in provincial cities. An expansion of this level requires a company to obtain more capital, because of this over 60 per cent of all fashion designers are now public limited companies. Diffusion line development, stages 3 and 4, are often franchised to third parties with the designer having control over the product and its brand image. Between 20–30 per cent of gross margin is spent on advertising support to create global campaigns to enhance brand image in foreign markets. Company's have to deal with the tension between the desire to be exclusive and the desire to produce product line extensions and widespread distribution which could lead to the dilution the brand's value.

Glamour publisher Bill Wackerman attributes the growth in the luxury market to a phenomenon called "mass-tige," a play off the word "prestige". Wackerman uses Isaac Mizrahi selling his designs at Bergdorf Goodman as well as Target, and Karl Lagerfeld's apparel at Chanel and low-priced retailer H&M, as evidence that the phenomenon is taking place.

Many luxury brands maintain their reputation through brand extension. A Brand extension is the use of an established brand name to introduce a new product or service. Luxury brands use this strategy in order to reach a larger audience that may not be exposed to these luxury brands.

Consequences of brand extension activity while a company is doing poorly is seen as a trading down. The company will face difficulty because their luxury status was already becoming fragile. Dropping their prices and expanding will dilute their status with consumers.

Psychological benefits are considered to be the main factor that distinguishes luxury products from nonluxury products.

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