WHY SHOULD LUXURY BRANDS SELL ONLINE?!

•  ULTRA-AFFLUENT STUDY (263 millionaires surveyed – Google 2008)!•  95% last luxury purchase online!•  91% information before buying luxury goods!•  94% it doesn’t cheapen their opinion brand / products!•  91% want luxury brands online!

•  BUSINESS GROWTH: !•  By 25% in luxury annually, 11 millions euros in value by 2015 (France). !•  The apparel industry is facing the most relevant increases on the Internet lately (11%)!•  A new online shop opens every half hour.!

•  E-commerce represents a MARGINAL part of a luxury brand revenues (90% income in store).!

•  Massive missed opportunity. WHY?!•  Online sales mainly take place in ‘pure players’ but... !•  Large hotel chains of hotels case!•  They’re losing percentage of sales to (successful multi-brands sites, department stores

sites, vintage shops, second-hand and bidding sites). REGAIN CONTROL over POC.!

•  CONTRADICTION!•  The need of a well defined strategy: Chanel case and Céline. !

WHY SHOULD LUXURY BRANDS SELL ONLINE?!

FROM A CONSUMER’S POINT OF VIEW!

FROM A BRAND’S POINT OF VIEW!

POSITIVE ASPECTS FOR BOTH!

ü  Time efficiency!

ü  Convenience!

ü  Anonymity!

ü  Changes on shopping behaviors are resisting the principle that luxury is consumed to show status, that is to say that luxury needs to stay for a ‘happy few’. Luxury buyers are tending to value more products than the buying experience.!

ü  Engage with customers wherever they prefer. E-shops will not put and end to physical ones or cannibalize their sales. In fact, e-commerce has shown to be a complementary channel of distribution.!

ü  Growth potential - a shop 24/7!

ü  Greater choice of goods and services & Long Tail Theory!

ü  Web 2.0: source of information (comparison, reviews, etc.)!

ü  Online Added Services!

WHY SHOULD LUXURY BRANDS SELL ONLINE?!

OPPORTUNITIES FOR A LUXURY BRAND: !

•  Conquer NEW CLIENTS!

•  Optimization and deeper CRM DATABASES: actual & potential consumers.!

•  FURTHER INTERACTION with audience: development of a sense of group belonging.!

•  DIRECT COMMUNICATION / access to audience. !

•  Greater fluidity and transparency!

•  EXPAND the brand to new markets & business at a lower level of investment | GRANT ACCESS to luxury in non-urban areas.!

HOW SHOULD LUXURY BRANDS SELL ONLINE? !

WEBSITE CONCEPT "

(coherence between offline and online strategy)"

ASSORTMENT!

BUYING EXPERIENCE!

PRICE!

LOGISTICS!

SECURITY!

COMMUNICATION!

Source: Khamvongsa, Lanette!

HOW SHOULD LUXURY BRANDS SELL ONLINE? !

Defining a WBC in line with the brand’s core values, positioning and strategy. Included within the company’s general strategy as a point of contact with the audience. Answer to:!

•  Which digital model better suits ‘Brand X’?!a.  No e-commerce presence at all.!b.  E-commerce presence through third party websites.!c.  The friend (‘compagnon’) site. !d.  The twin (‘jumeau’) site. !e.  The partner (‘partenaire’) site. !

•  Should ‘Brand X’ sell its product in a mono-brand and dedicated e-commerce website, or on the contrary, sign agreements officially authorizing pure (or not) multi-brand players to sell its products online? !

•  Should ‘brand X’ externalize the service? !

  PRODUCTS PROPOSED TO SALE OBJECTIVE OF THE WEBSITE EXAMPLES

FRIEND SITE Limited selection To develop notoriety and brand image Hermès, Jean-Paul

Gauthier, Isabelle Marant TWIN SITE Wide offer (most references available) To propose an alternative to the clients and

increase turnover Louis Vuitton, Dior, YSL

PARTNER SITE All references sold in stores and eventually exclusive products

New distribution channel, generating activity Thierry Muggler, Bell&Ross

Source: Enora Consulting (Luxury 3.0)!

HOW SHOULD LUXURY BRANDS SELL ONLINE? !

WEBSITE CONCEPT "

(coherence between offline and online strategy)"

ASSORTMENT!

BUYING EXPERIENCE!

PRICE!

LOGISTICS!

SECURITY!

COMMUNICATION!

Source: Khamvongsa, Lanette!

TRANSPOSING THE STORE BUYING EXPERIENCE ONLINE!

PRINCIPLE: Create an ‘e-ritual’ by understanding the store experience to recreate it online. !

•  CHART OF EQUIVALENCE!

!

•  SOME BASIS:!ü  Design a NAVIGATION FLOW = Intuition, easy access and explicitly. !

ü  From e-shopping to feel-shopping: visualization, atmosphere, ergonomic website, implementation of new technologies -360º videos, zooms, HQ pictures & content-, detailed information, assembly of products, cross-sales, etc.!

ü  Personalized & recognizable: innovation, invention and creativity.!

IN STORE CRITERIA! ONLINE EQUIVALENT!

Politeness and respect from employees" Wording and themes of the website fits with the brand speech"

Rapidity and service in after sale service" mail / hotline clearly identified on the website to contact the after sale service"

Staff meets client's expectations" Avatar to drive and help customers on the website, FAQ or even chat with salesman"

Good packaging" possibility to have the same packaging as in store"

Short waiting line on store" Cient path short and clear, watch the functionality of the webpage"

Goodlooking staff" N/A"

Nice boutique" Graphism and Design of the website fits with the brand image and merchandising codes"

Ease to obtain information by phone" phone number clearly identified and short waiting time, click to call possibility."

(-) IM

PORT

ANC

E (+

)"

360º STRATEGY !Global Multi-channel

Retail strategy !

‘Click and Mortar’ business

model!

Complementing & intertwining

channels!

HOW SHOULD LUXURY BRANDS SELL ONLINE? !

Source: Khamvongsa, Lanette!