Luxury

Luxury Brands in 2021: Digital Marketing and Customer Experience (CX)

With the rising importance of DTC/D2C, luxury brands are embracing a digital transformation and omnichannel strategy like we've never seen before. One can easily see that through lower-funnel investments online, brands that were once averse to adopting any sort of online strategy now feel the need to extend themselves digitally, given the global economic landscape has been anything but certain this year.

Here's G & Co.'s take on Digital Marketing, Strategy, and Customer Experience (CX) for Luxury brands in 2021. G & Co. is a full-service digital marketing agency and luxury retail consulting firm with expertise in fashion. As a full-service design firm and digital agency, we do everything from UI/UX for mobile apps and brand identities to marketing websites and enterprise software, having a specialized focus on direct-to-consumer (DTC) and luxury brands.

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A luxury digital marketing agency's take on customer experience in 2021 (CX): G & Co. talks about luxury digital marketing, strategy, and customer experience
G & Co. talks about luxury digital marketing, strategy, and customer experience

Any brand's digital innovation moving forward will have to thoughtfully consider growth-enabling initiatives if they wish to be or remain buoyant. In the luxury brand world, this online approach means differentiating their offering between their own ecosystem and that of retailer channels, opting for an omnichannel strategy that allows luxury consumers to choose however they wish to shop freely. Luxury brands are also taking to social media, where their increasingly growing demographic market reins. As such, luxury brands have come to embrace platform-native content to connect with this younger target audience. So what does this mean for luxury brands' digital customer experience (CX)

Digital marketing for luxury brands

We've established that luxury brands have recently turned to invest in digital infrastructure as the direct-to-consumer (DTC) business model's importance and benefits further entice companies in the face of economic uncertainty and what that means for future growth. There are, however, a few indicators in any luxury brand strategy that can determine just how prepared a brand is for both prosperous growth and agility in navigating unpredictable times. 

Among those indicators in a digital strategy is the strength of a luxury brand's omnichannel approach, the usability and accessibility of their online customer service, and whether they have not just embraced social media but play to their advantage on the platform they choose. 

"It's great to see luxury brands taking the big first step to digitally innovating. But that's all that it is: a first step," says Juan Manuel Gonzalez, founder of UI/UX eCommerce web design and development agency G & Co. "The real test in how successful any luxury brand is in their digital approach is just how well they're implementing what matters in the long run.

"It isn't enough that brands are starting to see the fruits of being online and think having a site is a one-and-done deal. Consumers today expect to have as robust an online experience as they do in-store."

G & Co. UI/UX design and eCommerce agency: Specializing in DTC & luxury brands

What Manuel Gonzalez says about implementation ultimately reflects how well a luxury brand can shine online. "Having the fundamentals down of providing an optimal shopping experience should always be first before a luxury brand can think about tapping into new markets for consumers."

Digital strategy and acquisition for luxury brands

The rise of online shopping does not mean the end of retail. What consumers want is simply the flexibility and convenience of being able to shop in whatever manner they wish to choose. As of right now, just under a third of luxury brands, according to a Gartner Index report, have what's called a "click-and-collect" ability, where consumers can order a product online and pick it up at an in-store location. But that figure severely lags behind the 71% of U.S. department stores that offer the same capability, meaning consumers have more reason to buy the same product from department stores than directly from the luxury brand.

A luxury digital marketing agency's take on customer experience in 2021 (CX): Less than a third of luxury brands have click-and-connect capabilities compared to the 71% of department stores.
Less than a third of luxury brands have click-and-connect capabilities compared to the 71% of department stores.

In Europe, which still has a substantial luxury demographic, customer service capabilities struggle even further than that of their American counterparts. According to Gartner, fewer than half of luxury brands in Europe offer the same features in customer service in line with the country's time zone in which they are present. Such a gap in a large consumer pool necessitates this as a top priority for luxury brands, especially in a time when those quickest to adopt the measures shoppers look for are those who may well be dominating the industry in the years to come. 

A luxury digital marketing agency's take on customer experience in 2021 (CX): Less than half of luxury brands in Europe have the same customer service offerings as their American counterparts.
Less than half of luxury brands in Europe have the same customer service offerings as their American counterparts.

Then there's the topic of social media, which brands are starting to embrace to meet and engage with today's luxury consumers. Yet, most brands that have taken to social media have not incorporated shopping functionality as part of their strategy. For instance, only a fifth of luxury brands have an integrated Facebook Shop tab on their official pages, according to Gartner. And of those, there are still a number of them who do not list a wide selection of their products, limiting luxury brands' very reason even having that page, to begin with. 

A luxury digital marketing agency's take on customer experience in 2021 (CX): Only a fifth of luxury brands have an integrated Facebook Shop tab on their official page.
Only a fifth of luxury brands have an integrated Facebook Shop tab on their official page.

And while younger luxury shoppers have less purchasing power than older demographics, their daily social media usage, and the fact that millennials are already more likely to purchase luxury goods than any other age bracket, means luxury brands have a potential pool to tap on marketing to this industry sector.

Customer Experience (CX) for luxury brands

At its core, what luxury brands must do is not think digital but think about customer experience. The growing millennial demographic in the high-end space signals that brands must do more to create value-based marketing. The mistake in thinking that an online approach and digital transformation meant just having an eCommerce shop means a serious return in thinking long-term. 

What consumers need from luxury brands going forward is for them to understand how they want to be engaged and that they need convenience both online and offline. 

How much are luxury brands spending on digital marketing/advertising?

Luxury brands are spending 33% of their advertising cost on digital marketing. And with millennials and Generation Z's share of the luxury market expected to grow even bigger in the next few years, we can presume luxury brands will also increase their advertising and digital marketing spend. 

As recently as 2017, Kering Group—parent company to luxury brands such as Gucci, Yves Saint Laurent, Balenciaga, and others—spent approximately €1.1 billion, or $1.3 billion in advertising. 

What is luxury brand digital marketing, how is it different?

With every luxury digital marketing strategy, the most important thing to understand is that the goal is not to attract every shopper but to attract the luxury shopper. 

As such, luxury brands must think about how they can target consumers by piquing interest instead of pushing interest. This can range from engaging an audience using social media, organic search ranking methods, and cross-channeling to expand their reach. 

If you need luxury digital marketing, please write us an email at hello@g-co.agency. As a luxury consulting firm and holistic digital strategy agency, we are fully equipped to plan and deploy a brand's digital marketing and omnichannel strategy.

Why is the customer experience (CX) different for luxury brands?

A luxury retail experience is different in that affluent consumers expect the entire customer journey to be as prized as the product itself. Luxury brands must know that the buying relationship is much more than a transaction—it is an emotional investment. And if consumers are spending a considerable amount of money on something, they expect a premium. 

As a luxury retail fashion consultant firm, we know that brands must understand how to communicate with, engage, and learn their customers' personal preferences to boost the shopping experience with an increasingly younger luxury market. 

With the shift of consumers from offline to online, we want to make sure that luxury brands have a luxury customer experience. This is where the importance of UI/UX comes into play; through a user-friendly online platform, we want to be sure consumers get the five-star experience they would with an in-store experience in their online. With this in mind, luxury brands are investing more into their customer experience for a highly covetable position they and their audience can enjoy. 

What is luxury consulting?

At its core, luxury fashion consulting is simply working with brands to advise them on accomplishing their short-term and long-term goals best. And with the large consumer landscape shift that we've seen in years past, luxury brands are looking for a partner to plan for a robust future. 

At G & Co., we believe that through consulting, we can support brands on their mission to better serve consumers and the world around us. And it's why our team of creative thinkers and strategists are happy to offer luxury brands with industry specialization and real-world perspectives to guide them for a solid future. If you'd like to seek our services, please send us an email at hello@g-co.agency.

Why is UI/UX important for luxury brand eCommerce stores?‍

A good user interface (UI) and user experience (UX) is essential for any eCommerce store in that it helps browsers easily navigate a website for the sole purpose of making their customer journey easier to finish. Most importantly, an eCommerce store is a window into a brand's image; the first impression a browser makes when coming across a shop can easily determine whether or not they will continue browsing and ultimately purchase something.‍

Why is eCommerce important for any luxury business?‍

In the rapidly changing world we live in, it's important now more than ever for brands to adapt to evolving consumer needs. And that includes meeting them where they are. ‍One of the most crucial things we focus on in any luxury retail fashion consulting project is whether a brand's eCommerce presence is where it must be to fully offer shoppers an equal or better customer experience than they can find in-store. Because for luxury brands to succeed in the years to come, they need to consider how to best position themselves online for the ultimate user experience. 

How is eCommerce different for luxury and non-luxury brands?

It's not enough for luxury brands to have a branded site just to check the box off on eCommerce. Consumers today want an experience that matches the quality of a luxury product they purchase. That's why luxury brands place a great emphasis on tailoring their approach to play on consumer sentiment and meet the mark of exclusivity.

As a luxury fashion retail consultancy, we can say that consumers want and expect to be engaged across multiple touchpoints and have a continued highly personalized journey that's always been quintessential with high-end names. The great differentiator between luxury brands with an adequate eCommerce strategy and a stellar one is their ability to communicate with consumers in a way that's both relevant and appealing. 

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