3luxuryAccording to a new eMarketer report, The Luxury Consumer: Shoppers Lead Brands to Digital Channels, the appeal of buying luxury goods goes beyond owning the actual item for many luxury consumers —it’s the experience surrounding the purchase of an expensive item.

What actually separates the luxury buying experience from the mass experience is the personal approach. As eMarketer revealed, they claim that translating that experience to the digital realm is one reason luxury marketers initially balked at the idea of creating virtual spaces for their goods.

The exclusivity a brand offers a customer—whether it’s limited-edition merchandise, a first look at a product or personalized service—is a key element of the luxury experience, the report states. And while brands such as Burberry or Yves Saint Laurent embrace the internet vividly, even offering exclusive pieces occasionally online, several luxury labels still have reservations, but anyway seem to be forced to please their clients.

According to PM Digital, a New York based digital marketing agency, luxury consumers expect to be wowed by every interaction, and they expect the same perfection, personal attention and level of service whether on a brand's website, social media page or in-store, and whether on a tablet, smartphone or laptop.

In its 4th Annual Trend Report: 2013 Luxury Brands Online, the company analyzed the state of luxury e-tail and predicts how emerging digital platforms and social media trends will impact the industry.

According to the report, all digital channels - paid and organic search, email, social and display- will have a major effect on luxury brands as they increasingly shift toward mobile and omni-channel offerings. Mobile will become even more integrated with the live experience of in-store shopping than online already is, since consumers can now access their favorite brands at any time by reaching into their pocket or purse.

Additional key findings from the study reveal:

  • Traffic to luxury brand sites is up 10% in 2013.
  • The five largest luxury brands (Ralph Lauren, Coach, Michael Kors, Louis Vuitton and Gucci) captured 75% of traditional online market share and 68% of mobile market share.
  • Search engines remain the largest source of traffic to luxury brand sites, accounting for 51% of all visits. This dependency outpaces that of the broader apparel and accessories category.
  • Nearly all major luxury fashion companies now offer e-commerce, but too many are still leaving traffic on the table by not running paid search campaigns.
  • Handbags and shoes are the most popular products driving search clicks for luxury brands.  Most of these searches include brand words, indicating a high degree of brand loyalty and decisiveness, although a higher-funnel marketing channel may also have driven them to search.
  • Luxury brands are largely absent on Google Product Listing Ads at this point. However, luxury products often appear with department store or multi-brand reseller's Product Listing Ads.
  • Luxury consumers are among the most-connected demographic groups, with twice the smartphone ownership rate as the general population.
  • Social media accounts for 6% of traditional web traffic to luxury brands, and nearly all of it stems from Facebook and YouTube. Many brands have also achieved sizeable, and still growing, audiences on Twitter, Tumblr etc. Engagement on these sites is mainly disconnected from visits to brand sites, but that is less true in a mobile environment.

"One of the aspects that makes this report so interesting is the way in which search and social marketing practices of luxury brands differ from that of other retail categories," said Suzy Sandberg, President of PM Digital's Global Digital Media division. "Whereas some luxury brands may be slower than non-luxury retail brands in adopting ecommerce, the sophistication of their social marketing and fan growth counts far outpaces their wider retail industry counterparts. This is just one example of how the luxury category behaves differently and why it's important to drill deeply into this particular vertical in order to understand the nuances that support their unique goals."

The burning question, eMarketer.com states spot on, is the fact that brand can’t communicate the attributes of a premium product without letting the client touch it, smell it or try it on, investigating why luxury brands beside these facts are reconsidering their aversion to digital marketing.

There are a few developments that are pushing them to increase online marketing efforts. One major factor is an increase in the amount of time affluent consumers spend online, Ipsos MediaCT found out.

Among US affluents with household income of more than $100,000 per year, the amount of time spent online grew nearly one-quarter from 2011 to 2013, at 32.8 hours per week to 41.6 hours per week, respectively.


“These aren’t the idle rich,” said Skip Brand, CEO of Martini Media, a digital agency specializing in luxury marketing. “These are people who use online resources to save time. And they will spend money to save time.”

Along with an increase in affluents’ time spent online is an increase in their spending online. Martini Media reported that among affluent shoppers, the average spending on luxury sites was up 20% year over year in Q2 2013.

In a Q1 2013 survey by American Express Publishing and Harrison Group, 48% of US affluents with income of more than $100,000 said they discovered new luxury products while shopping online, a rate almost equal to the 50% who said they discovered new products while shopping in-store. Even though consumers are still making more purchases in a physical store, they are discovering products online, and therefore being exposed to more marketing messages.

By MediaBUZZ