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Where and how luxury brands can take advantage of emerging technologies?

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Luxury brands – noble, well established, with great heritage and long history. Created, evaluated and carefully cherished for decades. Do they need to attract consumers in a modern and „non-standard” way? Is it actually wise to experiment with unsure solutions, trying to improve already excellent offer and well working business models?Let’s put aside for a moment a hype for flashy gimmicks with touchscreens and rethink if luxury brands really require emerging technologies. Honestly, I fully support the statement that innovation for luxury brands is not an option. It is a must.

Let me underline at first, that I am very far from “accusing” luxury segment of being technologically reluctant. In fact, by observing various forward-thinking luxury players, I believe that the spirit of innovation is what keeps them meaningful and relevant even with 50+ years history. Nevertheless, as a big fan of technology and early adopter myself, I agree that today’s world got rapid acceleration (thanks to digital revolution) and luxury brands need to adapt quicker than ever. There is already a number of great publications regarding role of innovation in heritage-driven luxury sector and practically every new technology deserves its own article. Instead of listing and trying to judge (anybody expecting „the ultimate bullet list” can stop reading now) I focused on macro trends, categorizing them into three fields where I perceive innovation as a crucial element for modern luxury consumers.

Field 1 – Product (and/or service)

It is not enlightening to notice that behind every great luxury brand there stand great products (and/or services). Without self-defending quality, any marketing effort, no matter how picture-perfect, will fail. When it comes to improving the product, new technologies are never easy to introduce which is even harder within luxury sector. Furthermore, due to their nature, many luxury products are perceived to be timeless and every technology, no matter how innovative, always will be replaced with a new one. For this reason it is key to consider product’s improvement through the lens of its predicted lifespan.

For products with long and very long lifecycle – watches industry for instance – a precise craftsmanship and physical features (e.g. highest quality materials) still should be their fundamental assets. Recklessly applying every nice-to-have improvements, even those very useful ones such as smartphone communication modules, surely will enhance current features, yet might not secure product’s value in – let’s say – 50 years (when your iDevice will be replaced with VR contact lens). Good solution for quickly outdating technology problem is just-introduced Tag Heuer Connected Watch offering a replacement option to Carrera’s analogue version 2 years after the purchase:

 

More conservative and careful luxury players – as recent Hermes-Apple example shows – can always use technological partnerships instead.

For products with short to medium lifecycle a technological approach should be through instant innovations. Luxury brands operating at this lifespan need to update/improve/adapt products very quickly to remain highly competitive. An example of truly (and literally) innovation-driven category is luxury automotive industry, where practically every year we see tons of new technology introduced. As just released BMW 7 series confirms (“Groundbreaking technologies united to create the future of luxury”) a technology-focused mindset pays off by effectively stretching positioning over entire brand also covering more accessible models. Porsche 918 Spyder is another perfect illustration how important role, not only for particular brand’s portfolio but also for the future of whole automotive industry, the innovation plays.

 

Despite the fact that luxury brands aren’t expected to be technological pioneers, quite often they actually are. Obviously, there are also luxury segments where products’ strictly technological improvements are quite rare or hard to introduce – mainly due to product’s nature itself (eg. perfumes, spirits, jewelry or clothes), however as this and this examples show, still possible to happen.

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Ringly.com – “Jewelry, meet technology.”

 

Field 2 – Customer’s experience

The line between product and experience within luxury sector is extremely thin and blurred. In fact, luxury products and experiences have to be treated as inseparable unity. Introducing innovations at customer’s experience level is effective way (and relatively safe) to refresh brand’s image without actually touching the production process. Emerging technologies had opened a whole new world of possibilities to trigger luxury customers’ engagement during their decision path which has to be considered in two dimensions:

 

Online experience.
Being aesthetically sensitive, my eyes are really happy to see that internet finally grown up to luxury standards. With popularity of HTML5 language, philosophy of sharing UI/UX best guidelines and ecommerce success (some great do’s and don’ts here), luxury customer is not limited anymore to few high resolution packshots. As recent Havas LuxHub research confirmed, ROPO behavior (Research Online, Purchase Offline) is very common and “Owned Media” play fundamental role in brand’s storytelling. Well planned modern websites provide a pleasant and immersive product’s exploration while securing qualitative brand experience. They should be treated as digital storefronts requiring advanced technologies to be introduced as early as on developer’s level (responsive design and instant loading time is an absolute must). Cutting budget on website’s development process gives only illusive savings, as keeping it in-line with latest technological and design trends allows to smoothly guide visitors from homepage to basket checkout.

Parallel to brands’ official websites we have a luxury multibrand e-stores and their flagship example – net-a-porter.com which had mastered the art of selling luxury goods with delivering a valuable and engaging curated content (eg. via The EDIT magazine). Net also released The Net Set platform (thenetset.com) which by adding social features elevates shopping experience to whole new level of engagement, making Net-A-Porter a significant virtual competitor for premiere physical department stores.

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The Net Set – “Share & shop with the world’s most stylish women, including Poppy Delevingne, Liberty Ross, Erin Wasson and many more fashion-loving members.”

 

Offline experience.
The simultaneous dimension of customer experience is what actually happens in brick-and-mortar points of sale. Despite the rapid development of ecommerce business, a boutique’s window exposition still remains an extremely important touchpoint during luxury consumer journey (indicated as „the most relevant touchpoint” by 61% responders in Havas LuxHub research). That’s why innovations also should be introduced within the physical store, however not being limited to free Wi-Fi but considered as advanced CRM systems driven on live data. Great example of truly individual customer’s treatment is Burberry having its personnel equipped with tablets with full range of information about returning visitors.

And here we reached the biggest challenge – how to create a solid bridge between online and offline worlds? It is partially possible thanks to click-and-collect function in e-shops, which gives the convenience of online shopping and does not take away an exclusivity of in-store experience. However, thanks to Polish company Estimote, there is a better way to connect online and offline dots through Beacons. Combined with dedicated mobile app, these small passive-communication devices allow for precise customers’ tracking and understanding their shopping behaviors. By delivering such metrics as demographic data, personal interests or average checkout value, Beacons are not any sort of “flashy gimmicks” but a massive data driven marketing tool. It is actually possible to track which product the customer considered during his or her boutique’s browsing and match it with the same customer who visited brand’s website 3 days ago and who will receive a special offer by email in upcoming days. Furthermore, thanks to Beacon-App combo, the customer gets a detailed product’s description (plus individual style guidance) while staying in front of the shelf. And this is where true beauty and power of Beacons actually reveal – they bring actual benefits not only for marketers, but mainly – for the clients.

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estimote.com

 

Field 3 – Communication

Last but not least, innovations should be introduced on communication surface. Digital age had rearranged the media & advertising picture known 10-20 years ago. New media brought both challenges and opportunities and luxury brands have no choice than to adapt accordingly. Important reason why luxury brands should focus on new ways of communication are 87 millions of Millennials (figure for US market only!) approaching their ‚productive age’. These people are gaining financial power and many of them already are (or will be soon) luxury buyers. Building long term loyalty (which is a true challenge within this generation, itself) heavily depends on how brands will connect with them now. Speaking the same language is the starting point, which explains why Valentino and Michael Kors used Snapchat during last fashion shows and why luxury brands with 10+ millions Facebook fans should provide more attention than 1,54 post a day.

I am aware that big concern of luxury sector is fear of losing exclusivity, as Internet creates a very open and democratic environment. Nevertheless, the risk of brand erosion can be greatly reduced by defining digital communication guidelines with three major aspects in mind: selective touchpoints used, appropriate contextual environment and qualitative advertising forms.

Trending touchpoints.
The rise of bloggers, social platforms, message boards and mobile apps had created a new ways of approaching (and maintaining!) consumers. Today, everybody can be content curator and luxury brands should not ignore neither avoid this shift but take full advantage of omnichannel communication plans. The key is to keep storyline consistency across various touchpoints although narrate it in unique – for each one of them – way. It’s obvious that consumers expect other messages on Instagram and other on Harper’s Bazaar homepage so with such ‘adaptive consistency’ even complex multichannel communication is clear and effective. Another great advantage of Internet is its infinity and unlimited space which allows to create dedicated landing pages for a single campaign needs, serving as campaigns’ footholds, providing unified axis for online-offline activations.

Appropriate contextual environment.
The critical issue for luxury brands’ communication is to maintain a qualitative advertising environment. For the same reason luxury brands do not use tabloids or cardboard billboards, they must not be present on every single banner available. Apart from cats’ memes, Internet brought many places with super qualitative content and this is where luxury brands should focus their marketing efforts. Whether a fashion portal (Elle.pl for instance), gadgets & trend tracker (GearPatrol and Fancy.com are my favorites) or technology updater (eg. Mashable, Cnet or The Verge), such websites aren’t any worse than „old fashioned” printed Vogue magazine.

Qualitative advertising forms.
Appropriate context and touchpoints are nothing without appropriate advertising form. High focus on aesthetical details is what remained unchanged even with a birth of new media. Whether we are discussing standard creatives (banners/screenings) or more advanced partnerships (such as sponsored sections / content-integrated native forms), keeping picture-perfect visuals and eye-candy creative layouts is non-negotiable.

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Van Cleef & Arpels Ad by BETCLUXE.com

To sum up, If I would have to pick the best recent technology with a highest potential for luxury sector, that would be indisputably a mobile integration. No matter if consumers are connected with brands via Bluetooth, Beacons or Internet, treating smartphones as humans’ senses extenders and a technological bridge between off-line and on-line worlds, creates remarkable opportunities for modern luxury marketing. Most importantly, it has to be underlined that true innovation is going far beyond “cool features” and to use emerging technologies as enablers in taking overall customer-brand experiences to a whole new level.

 

Piotr Paluchowski – Havas LuxHub

Article initially published on geekgoeschic.co (http://geekgoeschic.co/2015/11/12/do-luxury-brands-really-require-emerging-technologies)

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