Luxury Brands’ Digital Success Depends On Convenience And Innovation
(guest blog post by Research Associate Victoria Manes)
Luxury fashion brands continue to press ahead with their efforts to retain digitally mature luxury consumers. Forrester’s consumer surveys show that luxury consumers are spending more online compared to those who shop in the physical store. They expect brands to deliver innovative, easy, and emotionally engaging experiences.
Highlights From Forrester’s Latest Digital Go-To-Market Review
Using Forrester’s Digital Go-To-Market Review methodology, we evaluated 15 luxury fashion brands across attributes essential to their long-term digital success and the strength of their direct-to-consumer operations — in other words, how well brands are positioned to thrive independently of retail partnerships and popular multibrand platforms such as Farfetch and Net-A-Porter.
We found that high-performance brands:
- Offer advanced omnichannel services. Top-scoring brands offer omnichannel services such as online visibility of in-store product availability and in-store returning of online orders, which significantly influence customers’ decisions to buy online. Not all brands reviewed provide these key capabilities, however.
- Embed their core values within the customer journey. Higher-scoring brands are calling attention to sustainability information in the flow of customer journeys by including details on the sustainability of products and packaging in their product detail pages. With customers increasingly making purchase decisions based on their values, luxury brands must do more to show their sustainability efforts.
- Innovate with technology to deliver better customers experiences. Higher-scoring brands such as Gucci and Burberry are responding to luxury shoppers’ demands for convenience and innovative experiences. These brands offer immediate access to expert advice via live online chat and virtual appointments with sales associates. They also use digital innovation to go beyond in-store experiences, from Chanel’s multiproduct “virtual try-on” feature to Gucci’s digital gifting service allowing customers to give gifts virtually and make group purchases. These brands are also experimenting with in-game features and metaverse-style experiences. But luxury brands must be cautious. The metaverse does not exist (yet), and Forrester’s survey data shows that businesses are currently more interested in the metaverse than their consumers.
Contrasting lowlights include:
- Failure to list authorized resellers. Controlling product distribution and minimizing counterfeit goods and unauthorized resales are core to luxury brands’ exclusivity. Yet only one of the 15 brands reviewed provides a clear list of authorized resellers, though this information is still buried in the FAQ section. Luxury brands must do more to manage e-control and provide clear information to customers.
- Lack of clear counterfeit information. Luxury fashion brands are vulnerable to counterfeit, making resources to avoid, report, and manage counterfeit important for customers. Around half of the brands reviewed provide information to help customers identify counterfeit products, but this key detail is, again, often buried in FAQ sections. Furthermore, only four brands provide customers with a way to report counterfeit items.
The precedent has long been set: Online luxury sales work. Brands such as Gucci, Burberry, and Balenciaga are improving their omnichannel services, not limiting the value of goods that can be purchased online, and bringing value to the customer journey. Luxury brands have high opportunities to improve their digital commerce, but many still need to address foundational aspects of omnichannel capabilities and digital user experience.
If you’d like to learn more, please take a look at our latest report, Digital Go-To-Market Review: Luxury Fashion Brands.