How can luxury retailers replicate exemplary service online?

Shopping for luxury goods has always been a theatrical experience. From the glorious window displays, to the white-gloved doormen who graciously allow you to enter. After browsing the store – with a glass of whisky or champagne if you are lucky – you finally get your hands on the coveted bag, tailored jacket or glittering jewels made from only the finest materials. The sales assistant then gladly wraps it carefully in delicate tissue and hands it over in a distinctive branded gift bag.

Unsurprisingly, when a customer is willing to pay a premium for a product, expectations regarding the quality of the service rise as dramatically as the price tag.

Despite the fact that luxury brands are generally mid-sized with considerably lower volumes than most other retailers, customers expect the shopping experience to be impeccable. But how can luxury retailers replicate this service online?

Both Selfridges and Harrods seem to be doing something right, with both enjoying increased profits for the year ending January 2015. Harrods unveiled a 4.2% rise to £146.3 million, while Selfridges reported a 3.4% increase to £155 million, with the luxury department store specifically citing an "enhanced multi-channel offering" as the key to its record results.

And a recent report by McKinsey, states luxury retailers are approaching an eCommerce tipping point. The consulting firm suggests eCommerce is now a top management priority which will drive online sales towards 18-20% of total revenue in the next five years, while online sales of luxury goods may triple to €70 billion by 2025.

Late adopters

Luxury retailers are slowly joining the eCommerce revolution. Last year Fortum & Mason built a brand new website with Red Badger and the brand experience was so important to the replatforming that the luxury retailer even used the in-store historian's expertise to make sure its standards were translated onto the site with consistency and integrity – and it paid off, as the website has won several design awards since its launch.

Olivier Van Laer, digital marketing manager at Gieves & Hawkes, made it clear that while the bespoke menswear tailor is adopting digital technologies, it is not about to compromise its heritage for the sake of online.

“We have a beautiful story to tell, but we need to keep it simple – if you overcomplicate what your products stand for, you’ll alienate your customer," he says. "We’re not going to hide the heritage and be something modern and something we’re not, or we will lose relevance to our customers."

Ruth Harrison, director of retail strategy Europe for the digital design agency ThoughtWorks, tells Essential eCommerce that luxury brands have been slow to adopt eCommerce because they are fearful online could detract from direct store sales.

Harrison, with 25 years of experience across John Lewis, House of Fraser, Selfridges, Elizabeth Arden and Jo Malone, says: "Pureplay retailers such as Net-a-Porter and Yoox have proven eCommerce can be hugely successful. The keys to success are providing engaging content and ensuring services typically available in the physical environment are also available online, whether via personal styling, giving previews of collections or giving access to style advisors 24/7."

Added extras

ThoughtWorks has been working with a luxury US boutique chain, Mitchells Stores, to create on and offline style advisors with digital services and virtual wardrobes.

Using personalisation technologies, customers can access VIP personal stylists and virtual wardrobes which allow sales associates to curate product selections based upon customer profiles, using past purchase history, and real-time inventory.

Meanwhile, Jamie Merrick, head of industry insights, at eCommerce platform provider Demandware, says luxury retailers need to promote engaging websites with dynamic features like shoppable content and virtual store tours to deliver a unique online experience to their customers.

"Luxury retailers need to use all the tools in their arsenal to deliver a premium experience that makes each interaction stand out," he tells Essential eCommerce.

"Providing exemplary customer service that supports higher order values also relies on delivering a consistent experience. As shoppers move seamlessly across multiple channels, shopping baskets, promotions and recommendations need to shift with the consumer to bring a heightened level of service and intimacy into the digital shopping journey. Only by being able to coordinate merchandising, marketing, promotional and loyalty initiatives across multiple channels will luxury retailers be able to deliver the in-store wow factor to each customer online."

Merrick also advises luxury retailers to invest in making purchasing online as easy as possible for customers.

"Over indexing on items like streamlined guest checkouts, clear product detail and return or exchange policies will also ensure online consumers have access to the information usually provided by store associates," he adds. "But offering a premium service is absolutely key in luxury and the best way that retailers can do this is through free delivery."

Luxury fulfilment

ThoughtWorks' Harrison agrees, saying luxury customers have higher expectations when it comes to fulfilment.

"Luxury retailers need to be considering ‘same-day' or even ‘within-the-hour' capabilities," she suggests. "To complete the online experience, retailers need to offer a premium delivery service, for which customers would be willing to pay an additional cost. Successful luxury retailers understand the key differentiator is no longer just the product, but rather a seamless customer experience.

"Combining a fast delivery method with predictive-precision inventory analytics will have a multiplier effect on sales and margin performance and above all customer satisfaction."

Ed Stevens, founder and CEO of eCommerce order management solutions provider Shopatron, says luxury shoppers are insisting on a consistent customer service both on and offline.

"This experience is impossible to provide without a strong order management system (OMS). For the luxury consumer in particular, inventory visibility is a key component of a seamless shopping experience. Retailers catering to this market, should be able to quickly locate an item anywhere in their network – be it at a distribution centre, in a boutique, or in a department store – and display this to the customer online. This gives the consumer an array of delivery or pickup options and it assures them that the product is available and ready to ship or pickup," he says.

Fulfilment firm, Doddle, recently surveyed UK shoppers about delivery and returns when buying luxury goods online. Nearly half of UK shoppers believe high street retailers offer the most convenient delivery and returns services compared to only 5% who pointed to luxury brands for the best fulfilment services.

Doddle CEO, Tim Robinson, says: “To date, high street brands have had the edge on luxury brands in terms of responding to consumers’ delivery needs. But I think the luxury sector which was a bit slower at adopting ecommerce strategies, is starting to catch up.

“In just the last month we’ve met with several luxury brands that are improving the brand experience by offering more convenient delivery and returns options, including Doddle. For luxury brands online, giving their customers the choice in fulfilment is as important in the customer journey as ensuring they cater for consumers’ varying product demands.“

One obvious brand which springs to mind when you think of luxury online, is of course, Net-a-Porter. The online luxury retailer – which has just merged with Italian eCommerce company Yoox to become The Yoox Net-a-Porter Group – has been offering same day delivery in select locations for over ten years. Customers in London, New York, Hong Kong and now Sydney, can take advantage of a service which is more than just a way to get purchases to paying customers as quickly as possible; Net-a-Porter focuses on the little touches to make its premier delivery service a luxury experience. One part of the luxury service is that customers receive their order directly from a smartly dressed assistant wearing a black jacket, carrying the product in a black box with a beautiful cross grain ribbon.

Content is king

But luxury retailers cannot just depend on providing an impeccable sales service, they must continue to build a relationship with their customers, especially if their products are not frequently bought purchases. 

Krug Champagne has been using a simple serial number to unlock information about individual champagne bottles. Using a mobile app – and increasingly social media – Krug allows customers to digitally learn about their champagne from the Krug ID, which provides information including the blend of wines, climate, challenges when bottling and tips to store and serve, as well as food pairings.

Another way to connect with customers is through high quality online content, such as blogs or magazines, such as the Harrods Style Insider which connects customers to newsworthy products.

Net-a-Porter, again, does this extremely well with its weekly digital magazines as well as physical magazines which can be purchased on newsstands next to glossy fashion magazines.

With all of its innovations, Net-a-Porter is clearly a technology company, using data to drive customer engagement as well as developing industry-leading mobile applications, like The Net Set – the retailer's social shopping application which allows customers to connect with models, designers and brands.

This link between physical luxury magazines and a digital shoppable app monetises social media and encourages customers to return to its site again and again.

American cosmetics brand, Urban Decay, is also using content to connect with customers by launching the 'UD All Access' website. The luxury retailer is using a global content hub to give various global Urban Decay eCommerce platforms access a central system of blog content which can be downloaded if relevant to specific regions.

"It's so easy to fall into the trap of a brand's website being a store and only a delivery system for products," Urban Decay's assistant vice president of digital, John Perasco, tells Essential eCommerce.

"If you compare the website to before the launch of 'UD All Access', it's still not a product listing – it's all about telling the story with gorgeous photography and ethereal videos to help place the product in a mindset, with the emotion a customer feels. It's not just applying colour to her eyes. And the content on the website is crucial to that."

Don't forget about offline personalisation

But retailers should remember it is the personal touches which are quite often the reason customers return to luxury brands. The Ultimate Travel Company goes to great lengths to personalise holidays for its clients, for instance remembering the customer's preferred seat on a plane. But these 'simple things' can become complicated as smaller retailers grow into substantial sized businesses if they do not have the data at their fingertips.

Julia Elliot Brown, co-founder and CEO of online luxury shoe retailer Upper Street, says luxury retailers not only need to set the scene with perfect photography and evocative copy on their websites, they need to personalise as much of the experience as possible.

Brown's business allows customers to use an online tool to design their own shoes and save them online in a personal folder.

But Brown explains whether you are a multichannel retailer or a pureplay, you must use both offline and online to your advantage. "You've got to mix it up, there's nothing nicer than getting a personal call from one of our stylists to talk you through the design process or phone you up after you make your order."

And this offline culture can extend right until the customer receives their delivered item. "You open up the box and obviously you've got your gorgeous shoes, but you have a velvet bag and a handwritten personal note," she explains. "We also pop in some gel pads in case you want a bit of extra comfort."

"It's all those little things that make you think of luxury."

For more information, click below:



Red Badger