The digital dilemma for luxury
The luxury brands that have trusted upon multi-sensory experiences for ages are now facing digital challenge. Luxury is about uniqueness, rarity and scarcity whereas digitalization is all about breaking boundaries and reaching the masses. The very nature of the two contradicts each-other, making luxury sector reluctant to embrace digital technologies for years. However, as digital platform has become part and parcel of our lives today, luxury marketers just can’t do without it.
New-age technology has revolutionized luxury domain by providing endless opportunities to luxury retailers. Artificial intelligence, augmented reality and voice-controlled shopping are set to reshape luxury retail landscape to make it more customer-oriented. Opulent consumers are expecting effortless and immediate luxury experiences. Voice-controlled ecommerce is enabling luxury brands to provide exceptionally fast service at a minimum cost. Augmented reality such as smart mirrors is allowing luxury consumers to interact and gain appropriate information such as price, materials used or options available, more conveniently. It is facilitating consumers to ‘try’ new offerings at home before buying online. For example, Sephora’s Virtual Artist app assists its users to test makeup products before making virtual purchase.
According to research by McKinsey, almost one-fifth of personal luxury sales will take place online by 2025. Although only a small proportion of luxury sales happen online today but it definitely adds to the offline buying experience. Most of the buyers today explore the product online before indulging in actual buying, either online or offline. Many luxury brands including, Burberry, Gucci, Coach, Louis Vitton, to a name a few, are using digital platforms to establish deeper connect with millennials and providing them with seamless bespoke experience across all channels. They are making huge investments on search visibility, social media marketing, m-commerce and e- commerce platforms. Many brands are extensively using Instagram as sure-fire way of promoting their labels and generating maximum exposure among the youngsters. Instagram has truly been able to engage people through sharing minute details about fabrics, stitching style, designing as well as inspiration behind the collection.
Let’s take a look at the digital initiatives taken by the top luxury brands in the recent past. Burberry launched the first ever “see now, buy now” campaign which was indeed a great surprise for its patrons who were more than happy to buy their dream immediately after the runway presentation. Many others like Tom Ford, Tommy Hilfiger and Ralph Lauren followed the suit. Another one is interactive 3D campaign which enabled customers to design their own Burberry scarves on their mobile handsets and post it on the Piccadily Circus “Curve” screen. Similarly, Chanel has been successful in evoking passion and enthusiasm among people through its engaging YouTube videos. Gucci has been able to pull its online sales many fold times through its easy to navigate, interactive, engaging and fully-functional e-commerce store.
However, these campaigns have gained tremendous success but the big question is: Will the luxury brands known for its rarity and exclusivity lose its sheen by being omnipresent? Will fashion immediacy dilute the image of luxury brands in the long run? Will instant gratification result in moving the luxury brands away from its dream to create desire?
Many luxury houses are taking smart moves to deal with such problems. Some brands are coming with exclusive collection of their designer pieces available only online while others are showcasing limited addition of their items online to select clients. They are trying hard to retain extravagant feel of their brands while going online. Again, the question that comes to mind: Will these efforts help online luxury market gain traction? Future of the luxury industry rests upon the answers to these questions.
(This article has also been published in Luxury Daily on 29 June, 2018).