Embracing digital in a luxury world

16 November 2012

After recently attending the Walpole Luxury e-Business Forum in London, it was clear to see that luxury brands are still grappling with some key issues in and around their use of digital, and in particular social, as part of their overall marketing mix. It stimulated some interesting thoughts and discussions – most notably around the use of Facebook – and a big question still remains around delivering real, tangible value (i.e. revenue) back to brands.

There was no magic answer from the Retail Industry lead at Facebook or anyone else for that matter – engagement has value of course, but ultimately marketers are still searching for the justification that social activity has a direct impact on the bottom line.

Luxury brands need to use digital media increasingly more to target affluent consumers

Looking back 7 years, Facebook had only just been born. Only the true pioneers of digital were trialling how social media could support their businesses – luxury brands took a long time to embrace digital and become comfortable with it. It is understandable why this was the case – to hand control over their most precious asset – their brand reputation – to the public was a big leap of faith.

Today, many luxury brands are considered to be at the forefront of digital – for example Burberry, Mr.Porter and Oscar de la Renta. However the key consideration for luxury brands then is the same today. How to build brand awareness, advocacy, engagement and enhance the luxury experience online without diluting their brand values, ethos and reputation.

Similar concerns were voiced at the Walpole event – even today brands are still cautious about how they are represented in digital media, and primarily social channels. There seems to be conflict between those who believe social is crucial to building direct customer relationships and those who think it makes the brand too accessible to consumers who cannot necessarily afford to buy their products. Usually a battle between the brand marketing traditionalists and the digerati.



  • There were some good examples of social engagement. Sephora have been particularly savvy when it comes to digital and social. They built strong customer engagement via reward mechanisms such as their 15 days of beauty ‘thrills’ and Fan Fridays, where they offer exclusive make-up tips and beauty gifts to fans only on Fridays, and a Facebook app which allows customers to spin a wheel to win random prizes. The brand has proven itself to be a leader in the social space, with digital think tank L2 assigning it a “genius” Facebook IQ.
  • Technology in store – affluent consumers have a much greater expectation that brands will provide mobile or tablet technology to store assistants, who will have greater ability to recognise them on a more personal level – and thereby really demonstrating the art of ‘clienteling’. For example Neiman Marcus offers an ‘Associate’ app (called NM Service) that enables customers to engage personally with their in-store assistant. The app lets customers create wish lists around their favourite collections, receive alerts about exclusive in-store events, and communicate with their regular sales associates. It also gives the sales associates access to things like purchase history and Facebook photograph identifications when their most frequent, and loyal, customers enter the store. Bridging this gap between online and in-store, and reacquainting themselves with their original shopkeeper ethos, will become increasingly more important to luxury retail brands over the next couple of years.
  • Employ social on your own terms – although Top Shop might have been the brand that stood out on the ‘luxury’ agenda, Justin Cooke their new CMO (ex Burberry) gave an inspiring talk on the art of storytelling, and in particular how he and his team catapulted Top Shop up in the digital leagues with their 2012 London Fashion Week social campaign. By integrating Facebook’s open graph technology into their own campaign microsite they were able to digitally stream their live catwalk, but on their terms – not Facebook’s. They also incorporated some clever engagement tools – such as providing links to purchase fashion show soundtracks on iTunes. The results were astonishing – over 2 million web views and a significant increase in sales resulting in new lines selling out.

Although there is still a lot that luxury brands can learn from mainstream retail in their use of data and CRM, it is refreshing to see a case of retail learning from luxury. Nevertheless it will be interesting to see how Top Shop and others evolve their digital and social efforts – it continues to be exciting times for retail.


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