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How to rise to the e-luxury challenge

How to rise to the e-luxury challenge

By Frank Lord, EMEA managing director ATG

Luxury brands have long prided themselves on offering customers the ultimate personalised shopping experience, but many seem reluctant to embrace the opportunities offered by e-commerce. This strategy may have worked in the past but is no longer realistic given today’s retail environment says Frank Lord, EMEA MD at ATG.

High-end luxury brands face tough times as the retail slowdown gathers pace and shoppers begin to think twice before spending big. But, despite fears of a recession, international sales of luxury goods are continuing to flourish with many high-end retailers reporting strong financial results.

According to analysts, this is because declining sales in the West are being offset by sales in emerging markets where economies are performing better. These sales come from customers based far away, many of whom shop online rather than visiting stores in-person.

Since the only interaction these customers have with a luxury brand is in a virtual capacity, retailers need to ensure their online site offers the same high level of service offered in-store. 

The experience of shopping at a luxury brand-name store is often worlds apart from that of buying from a run-of-the-mill high street retailer, and while some luxury retailers have started to take their brand online, many have held back in the fear that opening up their offering to a wider online audience will result in a loss of control and may damage brand values.

Certain well-known luxury brands for instance still refuse to allow purchasing online, despite having a shop window presence on the internet, to ensure that purchasing their product remains an experience rather than a commodity.

These concerns however no longer need hold true, as developments in technology have made it easier for brands to re-create the key element of the luxury shopping experience – the personal advisor - online.

In a bricks-and-mortar shop, customers are able not only to touch and try the expensive goods before buying – they are often guided through the process by dedicated sales consultants whose role is to provide information and to build a personal relationship with the customer.

It is perfectly possible to provide this valuable service for customers online. Many luxury sites are now using click-to-call functionality, which allows users to click a button on a web site, e-mail or banner and initiate a conversation with an expert customer assistant via the telephone or computer.

These tools are important for luxury retailers since high-value buyers often require some level of reassurance before completing a purchase. They are also particularly important for those customers that cannot visit a store in-person and have a quick question they need answered before they will hand over their money.

Investing in technology that enables retailers to build sophisticated customer profiles so that web content is matched to specific customer interests can further extend this level of personalisation.

Once these tools are put in place, every time a customer visits a retail site they will be greeted with content specifically designed with them in mind, based on their stated preferences and previous purchases. In this way, customers will receive the same level of tailored service they would expect when visiting a specialist boutique that knows them well. 

The other area where luxury brands have traditionally added value to their customers is the prestige they carry. There is a certain special feeling of privilege that comes from shopping at an exclusive venue, frequented only by an elite.

Luxury retailers are now able to recreate this through the look and feel of their site, and by ensuring that search and navigation functionalities are effortless, as well as by using technology such as searchandising to ensure that customers are presented with offers and rewards that reflect their status as a valued customer.

Loyalty programmes and member-only areas and offers not only help drive traffic and increase a site’s ‘stickiness’, they can be very effective in maintaining brand value.

Now is the time for luxury brands to embrace the opportunities that e-commerce presents. As globalisation and the economy drive consumers online, the argument that opening up a luxury brand to a mass audience will have a negative impact on that brand’s value no longer holds true in today’s environment.

The demand for e-luxury retailing is here to stay, and those that are able to meet this demand by investing in online tools to deliver the personalised shopping experience synonymous with luxury retailing, will do well in months to come. 




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