Web Stores Are Leaving The Affluent Blasé About Buying Luxury Goods Online, According To Forrester Research
Luxury retailers spend millions trying to lure shoppers worth millions online. But according to a new Report from Forrester Research, Inc. (Nasdaq: FORR), affluent shoppers — those with investable assets of $1 million or more — expect a different luxury experience online. Rather than being dazzled online by exclusivity, extravagance, and entertainment, affluent shoppers expect convenience, confidence, and control — just like other online buyers.
“Affluent shoppers are a critical consumer segment because they set the pace for eCommerce adoption. They have been buying longer, feel more comfortable buying, buy more frequently, and, of course, spend more money online than anyone else. But at the same time, they buy online for the same reasons that all online shoppers do and care about price and positive experiences with Web stores as much as the less wealthy,” said Ekaterina O. Walsh, Ph.D., senior analyst at Forrester. “Despite their readiness to use the Net to purchase everything from prestigious cosmetics to designer clothes, the affluent have held back from buying luxury goods online because they are not getting what they want.
“Online purveyors of luxury goods should quit trying to recreate an offline shopping experience; channels aren’t different funnels through which identical experiences can be poured,” added Walsh. “Furthermore, by understanding and responding to the demands of affluent online shoppers, retailers will be poised to fulfill expectations of nonaffluent consumers who are right behind them.”
Most luxury merchants are designing Web experiences to replicate the look and feel of brick-and-mortar luxury shops by posturing exclusivity, extravagance, and entertainment. Most sites offering luxury goods share barriers to convenience like bandwidth-intensive interfaces, broken links, required plug-ins, and confusing error messages. Obstacles like forcing shoppers to choose a profile name for no apparent reason further undermine the user experience.
To create sites that meet affluent consumers’ needs, luxury merchants must deliver convenience, confidence, and control. Convenience must be offered through easy research, consideration, purchase, and returns. Keyword searches, few clicks to complete a purchase, and clearly communicated total cost all improve the convenience of online shopping. Confidence is built through brand equity and consumer trust. Familiar brick-and-mortar brands generate trust in Web stores, while smart pure plays will build their names via partnerships and cost-effective marketing. Control will be delivered with quality service, commitment to customer privacy, and savings.
For the Report “Selling To The Affluent Online,” Forrester analyzed data from six surveys of thousands of individuals and households in North America with investable assets of $1 million or more, not including the value of their primary home. Wired affluent households spent an average of $1,466 online in 2000, versus $817 for nonaffluent ones.