Think Tank: Understanding the Journey of the Online Luxury Customer
Upon walking into a store classified under the category known as “luxury,” a customer feels cared for as associates greet them and provide one-on-one help. A defining factor of retailers selling luxury brands is the individualized attention they strive to give shoppers. Rather than navigating the store alone, customers receive guidance from store associates who ask questions about the items they are looking for and assist them in achieving the unique style they want.
These high-end retailers, famously known for their expensive products and top-notch quality, rose to popularity for their ability to create highly tailored products for a community that values curated goods and experiences. Compared to non-luxury retailers, those in the luxury sector have continued to utilize their brick-and-mortar locations as hubs for the full end-to-end customer experience. This has allowed the shopper to not only touch and feel the luxury goods but to also feel part of an exclusive community, benefiting from in-person concierge experiences meant to convey a unique brand identity.
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According to Blue Acorn’s 2018 Luxury E-commerce Report, the majority of luxury sales are transacted in-store, with only 8 percent of sales coming from e-commerce. Online is predicted to represent 25 percent of luxury goods sales by 2025. As more and more shoppers are taking to the web to fully complete their journey — from initial product discovery to their final purchases — luxury retailers are finding themselves adjusting their tactics to meet the needs of the new, omnipresent luxury customer.
As this shift takes place, the luxury market will need to translate the sense of pleasure customers feel when they walk into a store to the way they feel when they log onto a retailer’s web site. Though the physical advantages of seeing and feeling a product in person aren’t possible online, customers shopping for luxury products still expect the same attention and support. After all, a designer item isn’t an everyday purchase that shoppers buy on a whim; these are high consideration items and the online shopping journey should easily answer all of a shopper’s questions and more.
The disconnect between the rising popularity of online shopping and the hesitant feelings associated with making big purchases online begs the question — how can luxury retailers make site visitors feel confident enough to purchase like they would in stores?
Faster search capabilities lead to increased willingness to purchase
For the frequent luxury shopper, the individualized experiences and personal care received in-store needs to be re-created in the e-commerce setting. Without guidance, shoppers can quickly lose motivation to shop, resulting in lost sales for the retailer. Although face-to-face interaction is lost when a consumer decides to shop online, rich product data powering curated feature sets and personalized options based on past purchases or browsing history can provide the same core experience of getting immediate assistance upon walking into a luxury store.
The goal is for the online shopping journey to not feel like a technological one. Instead, customers should be able to search for items in a natural way. The experience should replicate the in-store interactions with a store associate. Retailers, especially those competing for a share of the luxury market, should take advantage of advanced technology that now allows a better understanding of context, nuances and regional terms than ever before.
With this backend technology in place, consumers can fulfill their wish lists much more quickly. For example, a shopper searching for a dress for an upcoming wedding, a gift for a friend’s birthday and the latest spring styles can have experiences via a laptop, tablet or smartphone that are just as personal and connected as shopping in a store. For the dress, she can make a specific search in her size and the occasion, ultimately helping her find curated results so that she doesn’t have to sift through pages of irrelevant options. When it comes to a friend’s gift, simply browsing for products the shopper thinks her friend will like produces helpful recommendations. On the hunt for spring styles, she can view curated collections, personalized to her tastes and preferences, serving as her inspiration for a new outfit.
Customized options create the online concierge feel
As luxury brand retailers continue to delve into the world of e-commerce, they also increase their opportunities to customize the shopping experience and add value to the customer journey, leading to increased sales. With the right personalization tools, retailers can monitor every action shoppers take on their web sites to glean insight into customer behavior and create a personalized experience that is unique and appealing to each and every shopper.
Similarly, advanced technology driven by rich product data helps retailers refine their product recommendations, personalizing each customer’s experience to match their styles and tastes. Technology such as machine learning empowers online retailers to better understand their customers and offer them specific products and specialized discounts according to their shopping habits. For example, a store associate may place a pair of earrings in your dressing room to go along with the dress you’re trying on. With the right personalization tools, retailers can mirror this practice online. A sense of being understood by the retailer, no matter the channel, makes the process of shopping less overwhelming and, in the end, more profitable.
A luxury-tailored online customer experience gets the job done
Even if a shopper has just stopped by the e-commerce site to browse, much like in-store window shopping within a luxury store, presenting an easy-to-navigate site with rich product attribution can go a long way in making a lasting impression with the shopper. For the frequent luxury shopper, the desire to be assisted throughout the shopping process shouldn’t disappear just because they choose to shop online — if anything, they depend on it even more.
To maximize the spending power these shoppers tend to have, luxury retailers need to learn to optimize search and personalization features online, creating a familiar shopping environment. The more retailers do this, the more they will see customers increase the size of their cart.
Though not the most popular means of purchase for luxury shoppers just yet, a luxury-tailored online customer experience strategy will become increasingly important as more shoppers conduct their buying processes online. Rather than leaving customers to fend for themselves as they make more of their purchases in the online world, luxury retailers have the power to make the process just as seamless and personalized as it is in the physical store, but only if they invest in the right tools.
Roland Gossage is chief executive officer of GroupBy Inc.
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