04 Luxury Shopping In The Digital Age

Topics: Goods, Luxury good, Luxury vehicle Pages: 6 (2246 words) Published: July 11, 2015
Toko Ohmori

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Luxury shopping in the
digital age

The “right” digital strategy differs for every luxury brand, but the essential elements are the same: a strong mobile presence, a selective approach to social media, and a tight focus on carefully chosen metrics.

Linda Dauriz,
Nathalie Remy,
and Nicola Sandri

Among luxury companies, conventional

luxury products online, and at undiscounted

wisdom used to be that participation in

prices. Our latest luxury-industry research,

e-commerce—and, in particular, selling

conducted in collaboration with Italian industry

through multibrand retail websites—was only

group Altagamma Foundation, indicates that

for the lower and middle range of products.

luxury companies are recognizing—and, in

The pervasive belief was that luxury shoppers,

some cases, successfully capitalizing on—the

with their discriminating taste and preference

increasingly important role that the Internet

for high-priced goods, wouldn’t buy expensive

plays in luxury shoppers’ purchasing decisions

things online; they would always opt for the

(see sidebar, “About the research”). One telling

personalized customer service and tactile

statistic: while overall sales of luxury goods

shopping experience that monobrand brick-

grew by a mere 2 percent in 2013, online luxury

and-mortar stores provide.

sales increased by 20 percent to an estimated

That thinking has evolved in recent years. The

we project that sales of luxury goods online will

success of ventures such as Net-A-Porter has

more than double to approximately €20 billion

shown that consumers are indeed willing to buy

in the next five years.

€9 billion. We believe this growth will continue;

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Today e-commerce represents a scant 4 percent

Luxury brands with informative, easy-to-

of luxury sales—but e-commerce is only one

navigate sites optimized for mobile devices—as

aspect of the digital opportunity. Our research

opposed to just standard websites designed for

found that an additional 40 percent of luxury

full-size computer screens—are therefore more

purchases are in some way inf luenced by

likely to drive store traffic. But brands shouldn’t

consumers’ digital experience—for example,

rely exclusively on their own sites to promote

through online research of an item that is

their products to potential customers. Luxury

subsequently bought off line, or social-media

shoppers are increasingly turning to product-

“buzz” that leads to an in-store purchase.

oriented sources of information, such as the
websites or mobile sites of multibrand retailers

Given the undeniable and growing power of the

and department stores, so that they can easily

digital universe, all luxury brands must think

compare products and prices (Exhibit 1).

hard about their digital presence. The “right”
digital strategy differs for every brand, but

Indeed, many luxury brands—in efforts to

what’s certain is that it’s no longer just about a

engage and inf luence customers in every stage

beautifully designed and user-friendly website

of the “customer decision journey”—are

or effective banner ads. The most successful

partnering with multibrand retailers online.

luxury brands will be those that build a

However, these brands must make sure that

compelling mobile presence, engage and

their presence on multibrand sites plays a

inf luence consumers through targeted use of

strategic role and reinforces their brand

social media, and focus on a carefully chosen

positioning. An ultraluxury brand that seeks to

set of digital-performance metrics.

convey an image of peerlessness and
exclusivity, for instance, might choose to be

Going mobile, being social

absent from any multibrand sites, whereas a

Three out of four luxury shoppers own a

brand that wants to play in the “affordable...
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