Why Luxury Brands Have a Difficult Time Online
With 94 percent of the ultra affluent in the United States regularly buying products online, according to a 2008 Unity Marketing study, why do so few premium brands sell their goods online? It would appear to be a fruitful space for the luxury goods and services market to penetrate. So, why the reluctance?
Last month, I wrote about how it would behoove the luxury market to become more adept with online strategies and make websites the focal point of business. But I also failed to discuss why the luxury industry has been slow to embrace the Web and how consumers' intentions, expectations, and behavior are completely different at a brick-and-mortar store than when they are perusing a site online.
A friend who graduated from the HEC School of Management's MBA program in Paris shared these thoughts with me: "Luxury brands have been having a hard time on the Internet because 'luxury' is an experience. It's something that you need to feel, taste, and touch with your own eyes and hands. It's difficult to sell luxury goods online, i.e., a Louis Vuitton bag, because with that one-touch point, you're missing out on the other variables involved in the 'luxury' experience. A luxury product is there for you to dream. It's difficult to convey this 'feeling' online. This is precisely why the retail outlets—and creating the luxury experience there with the attentive service, luxurious interior design, and first-class service—are so essential to a luxury brand. Superior customer service is the key to all true luxury brands. Luxury brands are there to make the consumer feel important and that with their purchase of a product/service that they have joined an 'elite' or 'exclusive' community."
Do you agree with this viewpoint? Do you think that making websites the centerpiece of a luxury retailer's business will dilute the value of its brand?
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Reader Comments
Luxury brands online
As the owner of an online beauty and fashion site (ambermag.com) for the past two years, it's evident every second how much online activity has transformed the way we consume, connect and, yes, handle commerce. Luxury brands and the stores they have, indeed offer a luxe experience like none other. So why would you not create a similar experience online? As this economic downturn forces every sector to r-echink how it does business in order to survive and thrive, there will be less people going into those stores to feel the experience. Instead, more people (no matter their economic standing), and certainly the next generation who are reared on texting, will embrace an online store with amazing photography and top cusotmer cervice (think Zappos, but more chic) with open arms dipped in diamonds.
Susan Adams
How about using web for lead generation? Simply to get a prospect to 'rise their hand'?
The super affluent spend a lot of time online because they have little personal time. If all of your efforts center around getting them in your store, you're missing an opportunity.
Revised Comment (What I really meant to say)
I think you should differ the "luxury brand value" and the "emotional aspect" with the necessity of the changed customer behavior. These HNWI´s or premium target group in common is very emancipated and strungle a luxury product access on a all channels.
The challange is to connect all channels (point of sale, online etc.) for a holistic and integrative brand & marketing strategie. If these instruments are observed & handeld separatly, the luxury brands will loose further high potential in the communication (and of course distribution) with the customer. The web is a opinion-leading platform,even on a digital and virtual base.
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