Digital strategies & luxury brands, the wide gap
We keep repeating it but digital is playing an increasingly important role in the marketing and communications strategies of luxury brands. However, they are struggling to allocate more resources to it. According to the study published by Exane BNP Paribas, which classifies luxury brands according to their digital engagement and reach, digital should feed an average of 40% of the growth in the luxury sector, between 2014 and 2020.
The internet is full of opportunities!
Even as industry sales strictly related to digital should only exceed 10% in 2014, consumers are increasingly shopping online. For two reasons: firstly there is less physical stores openings and secondly, the online shopping offers the convenience where the consumer has not necessarily neither time or motivation to go confronting the crowd. In an ideal world, the brands would like that consumers go to their their stores. Yes but now, the world is changing and it has been changing for quite a while. Brands need Internet as a lever for growth now more than ever, as they needed abroad a few decades ago.
It does pay!
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LVMH lagging behind, Kering saves the day
These gaps reveal the absence of a coherent digital strategy within the LVMH group, in total opposition to Kering, which benefited from the joint venture with Yoox in August 2012, the report said. Italian brands of Yoox Group, Armani, Valentino, Cucinelli, Moncler, improved their e-commerce Strategic reach but are still penalized by the lack of customization offered by their websites: no common services across its platforms, limited flexibility with shipping. Other Italian brands (excluding Yoox Group) are also in the middle (Tod’s, Loro Piana) or trolling (Bulgari, Ferragamo, Prada, Fendi).
“The CEOs of these companies should put digital engagement among top priorities of their agendas. If this is the case, things are done. If not, the subject is buried away in the organization and nothing gets done. “
So dear luxury brands, shall we go?
“Digital Competitive Map” (July 2014) | Source: Exane BNP Paribas
The study was based on 14 criteria, broken into four categories, for a total of 66 parameters. 1) depth and breadth of product offer (e-commerce strategic reach); 2) ease of navigation (on multiple devices) and quality of website experience (website experience); 3) delivery, service and return policies/performance (e-commerce experience); 4) cross-channel integration (cross-channel experience).
Originally published at www.clausette.cc on October 19, 2014.