How the luxury sector embraced the digital era
The growth of digital has been undeniable for several years now and every sector has had to adapt to it, creating social media accounts and offering e-commerce options to respond to the growing offer.
But how did the luxury sector which has to deal with the customer journey and high brand image perception cope with these changes?
In a Facebook report, it was noted that 93% of luxury customers are on social media. Needless to say, brands have had to adapt to the huge presence of its customers on these platforms.
As 89% of luxury goods customers for the “next generation” (Millennials and Gen Z) use Facebook platforms, according to the same report, and it is undeniable that they had a big role in the shift of offer from brands.
The digital strategy for luxury brands is mostly omnichannel, offering an e-commerce website, chat and social media platforms.
e-Commerce was the first step to take as it gave accessibility to the brand for people who did not live in a city where there is a boutique but still had the means to purchase. It turns out that this desire to buy online is more than impactful as 20% of luxury goods are nowadays purchased online.
To extend the high-end customer journey to digital, brands have become creative.
With the idea to maintain excellent customer services, Burberry has teamed with Apple to create “R Message”, a platform that allows store associates to communicate directly with the brand’s most important customers. As referred on Vogue the R message service is part of Burberry’s R World app and enables clients to make in-store appointments, get personalized recommendations on items — they can also purchase directly from the app.
But Burberry is not the only brand, as Farfetch, for instance, has launched an associate app as well with inventory and customer information. Coach, on the other hand, has experimented brand-customers messages via WeChat, and it has figured out that app users tend to spend 26% more than others.
Social media, according to a report from the Boston Consulting Group, has become the first source of influence on purchase decisions for luxury goods. In fact, it has been shown that more than a third of luxury customers have made a purchased thanks to one of Facebook’s platforms, demonstrating the importance of this channel for digital strategies.
For a luxury brand, having its own Instagram page, for instance, is now crucial to ensure sales, but it also has to focus on key influencers in order to push the brand’s image to a larger community. We are surrounded on our feeds by influencers, from YouTubers to Instagram, these new Brand Ambassadors have appeared in our feed daily.
But let’s look at a new kind on influencers, AI influencers.
One of the most popular AI influencers is @LilMiquela, with 1.8M followers on her Instagram page. However, there is a trick to it, the model and musician is actually created by a Californian start-up named Brud, making her, therefore, fictional. It did not stop brands collaborating with her, as for instance she scored a spot in the Prada campaign for Milan Fashion Week in 2018 or even more recently, she was featured in a Calvin Klein campaign with non-other than the Top Model Bella Hadid.
In conclusion, the Luxury sector has more than adapted to the digital era and might have become a trendsetter and a limit pusher in terms of digital innovation to push boundaries and improve customers’ experience.
About this article
This article has been written by a student on the Grenoble Ecole de Management’s Advanced Masters in Digital Business Strategy. As part of a content creation assignment, students are given the task of writing articles based on their digital interests and disseminate the articles online. Articles are marked but we make minimal changes to the content. Thanks for reading!
James Barisic, Programme Director, MS DBS.
