The Benefits of Selling Luxury Online
Before the advent of the internet, only a discerning group of individuals with large incomes could step into a boutique on Fifth Avenue or the Champs-Élysées to browse and purchase luxury items. All others were too intimidated by the price tags and notoriously arrogant sales personnel. The internet helped democratize the high-end shopping experience.
Early skeptics felt the idea of making high-end goods accessible to the general public via the internet went against the idea of selling luxury. Designer labels believed that opening online stores would diminish the aura of exclusivity, elegance and wealth surrounding their brands. Despite initial resistance, more and more luxury brands are discovering the benefits of e-commerce, secondary to direct sales.
Consumers today don't want to choose between shopping online and offline, and high-end brands are learning they can raise their brand profile by being accessible through all channels. While designers still market toward an elite target group, their image doesn't change — they just convey that image to a wider audience over the web.
Notably, conducting business online doesn't make the physical store superfluous. Rather, the brick-and-mortar structure and online presence supplement each other. In fact, a brand without an online presence is atypical in today's web-centric society. It approaches commercial negligence to ignore the online store as a viable channel for commerce.
Brick-and-mortar stores, for example, cannot keep up with the latest brand information. With the high speed of communication over the internet, online stores can. Therefore, more and more consumers look to designers’ websites for up-to-date information and product announcements, rather than asking store associates. Furthermore, many consumers dread entering a luxury boutique because of bad experiences with presumptuous store associates. Many luxury shoppers simply prefer the anonymity of online stores.
Of course, luxury items do lose some of their charm when sold online. They no longer seem "extraordinary" because any item can be bought at any time by anyone. Recognizing this fact, it's even more important for high-end brands to create a luxury experience when selling online. To do so, many employ specially trained customer service representatives in their call centers, or package the products in high-grade gift boxes prior to shipment. In this way, customers still feel special when they open the package.
One high-end European online retailer even offers customers the option to select whether the package bow should be tied on the box's left or right side. From product presentation to dispatch, everything must be conducted eloquently so that the brand's high standards are experienced throughout the online purchasing process. Luxury brands that don't provide the same level of care in their online shop as they do in their flagship stores won't be successful.
Online stores also can attract new customers. Individuals who live far from the large cities where flagship stores operate now have access to the same goods as in-store shoppers. Also, younger consumers gravitate more toward e-commerce, so luxury brands may reach a new demographic by developing an online presence.
Despite the benefits, taking a business online, especially a luxury brand, can be an intimidating task. Luckily, solutions exist to help mitigate the challenge. Some online retailers carry a variety of brands under one umbrella, like a virtual luxury bazaar. Here, the brand pays the retailer a fee for the service, as if it's renting online retail space. Aligning with such a website simplifies many processes. For example, it will photograph products to maintain a consistent feel across the platform, manage the payment process and act as an intermediary between the brand and the customer.
The optimal solution is to find an e-commerce provider with which to partner. A partner can analyze a designer label and develop an online store concept that aligns with the brand's overall image and goals. The partner assumes responsibility for developing, operating and marketing the brand's online presence. The best partners also offer logistics solutions, taking care of warehousing, payment processing, distribution and returns. With an all-inclusive partner, high-end labels can concentrate on their core business of designing elegant, timeless products and allow the partner to focus on maintaining an online shop, which requires considerable attention to technology and marketing.
Uwe Bald is vice president of international business development for Hermes, a provider of internationalization services to Europe, Russia, China and Brazil.