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All or Nothing? The luxury e-commerce dilemma

We take a look at the luxury e-commerce landscape and advise how luxury brands can make a success of the move online.

To sell online or not sell online? (That is the Luxury e-commerce question.)

Luxury brands currently find themselves faced with this dilemma.

Until relatively recently, the answer would’ve probably been a no. A noncommittal shrug of the shoulders at best.

The 2 main reasons for this?

  • Worries about translating your brand’s luxury experience online.
  • Fears that your products could become overly available.

But things are changing.

It was only a couple of years ago that Chanel’s global director of fashion Bruno Pavlovsky suggested the brand wouldn’t be venturing online in a hurry:

“Fashion is about clothing, and clothing you need to see, to feel, to understand.”

Chanel are now rumoured to be launching their e-commerce store before the end of 2016…

With the success of luxury brands who’ve already made the jump online, along with your customers’ expectations, perhaps the statement ‘luxury retailers can’t avoid the internet anymore[1] isn’t too far from the truth.

Don’t sweat it.

The worries your brand holds that an e-commerce offering will detract from your stores are unfounded:

‘The likelihood of [customers] having a physical experience with an environment is as likely as ever before. You’re just enabling them to purchase more if you give them an online opportunity.’[2]

Drip feed products online to create demand and measure success

Like performing the opening night of a production without rehearsal, launching a luxury e-commerce store immediately selling your full product range could end in disaster.

Your luxury customers crave exclusivity – the over availability of your products will kill it.

So, if you make all your products available online you risk alienating your core customers – the ones who spend big money.

But, let’s be honest, the all or nothing question is a myth. You need to find a balance.

For your luxury brand it’s all about finding the sweet spot between ubiquity and scarcity.

This balance is achievable online, indeed it’s an equilibrium that’s less tricky to find than many think; the e-commerce sector is perfect for testing and measuring.

By drip feeding select products online you can create demand while accurately measuring the impact your products are having.

By taking a selective and measured approach to luxury e-commerce you can banish any ubiquity worries you may have and provide a roadmap for your future online product launches.

The social media/luxury juxtaposition

The ubiquity vs scarcity question is also relevant to another segment of your online strategy – your social media.

Social media has a huge reach, but by its very nature it’s ubiquitous.

So there’s a juxtaposition in exclusive brands, who ‘need to play hard to get’[3], using social media.

A case in point is Michael Kors. The brand has achieved huge growth, some of which can be attributed to their stellar social media accounts: they’ve garnered 25 Million followers across Facebook, Twitter, Instagram, Vine and Pinterest. (SnapChat sit next on their social media firing line.) [4]

But growth has peaked and some analysts attribute this stagnation to ubiquity.

It isn’t farfetched to speculate that 25 million social media followers are a factor in this overexposure.

Of course social media is a useful way to engage with your customers, particularly the next generation of your brand advocates. But, just as with your products, being overly available or undiscerning with your social content can damage the essence of your luxury brand.

The democratization of the luxury market

Do you believe exclusivity is fundamental to your luxury brand’s success?

A new breed of e-commerce sites, led by Very Exclusive, are set to challenge this idea. Opening up luxury goods to a broader market by offering luxury brands such as Vivienne Westwood on credit.

This development reveals the extent of the split in luxury brands’ attitudes:

Some are embracing e-commerce to the degree they’ll feature on a credit-based site, while others are reluctant to enter the online marketplace at all.

The success of the brands featuring on sites such as Very Exclusive will provide an intriguing barometer of just how far the luxury market has integrated online.

One thing’s for certain – the stance that luxury goods can only be sold in-store is diminishing fast, leaving many luxury retailers preparing for an online future.

There’s no doubt the luxury e-commerce market is evolving quickly. But e-commerce is not an all or nothing equation for luxury brands. By being selective and measured you can successfully tread the fine (and profitable) line between scarcity and ubiquity in luxury e-commerce.




[4] ibid