Marketing

Luxury Interactive: What Luxury Brands Have Learned About Social Media in 2010

At the end of May, like last year, I had the pleasure to attend Luxury Interactive conference in London, organized by WBR. Luxury Interactive is a conference that “breathes” luxury in the sense that it is high quality, as it has both great speakers and attendees and is intimate, as the number of attendees is small enough for you to connect with everyone, and not just shove your business card in their hand.

 

I was impressed to see how far luxury brands have come in the social media arena, considering that only last year very few people had even heard of Foursquare and were still debating whether they should have social media accounts for their brands. This year having already embraced social media, brands are on the lookout for the next step and for new ways to leverage tech in the overall customer experience.

Luxury Brands & Augmented Reality

The more AR technology gets perfected, the more it gets into focus for brands that look for ways to incorporate it in their marketing campaigns and online and offline commerce.

Boucheron, which built its own augmented reality app with Holition within its website, allows customers to virtually try on its designs. The company considers its AR experiment successful and plans to keep augmented reality as a permanent service, adding more products and building AR mobile apps, as well. The AR app generated a lot of buzz in the media and renewed interest in the brand. The problem Boucheron faced with AR is the same problem many brands face with social media: “How do you measure ROI?” Cecile Francois, brand director at Boucheron said that although they were able to measure the buzz the campaign generated, as well as the increase in web site traffic (by 50%), they were unable to measure its impact in store foot traffic. As the budgets brands dedicate to digital get bigger, ROI is going to be a “hot potato” for many marketeers that will have to come back with numbers to back up their digital strategy and justify the investment.

Luxury Brands & Mobile Commerce

Mobile sites and apps enable brands to “blur” the line between the on and off line world and provide a truly holistic customer experience. Milton Pedraza talked about the ways mobile devices can enhance the in-store shopping experience. As an example, he mentioned the use of the iPad by Clinique at selected counters resulted in increasing sales by 30% at those locations. Mobile devices used by sales associates are also perfect for data collection apart from providing instant access to product data. Of course something like this would presuppose the constant education off sales people to these tools. Milton Pedraza advised brands to facilitate presentation to customers and transaction via mobile. Transaction via mobile, could also provide the perfect opportunity to sales people to collect these valuable customer data on the spot. Mr. Pedraza challenged brands to find ways to make a simple humanistic experience, like shopping a product, magical with mobile by focusing on useful and relevant features and not gimmics: “Out-behave and outperform your competition via mobile!”

Luxury Brands & Branded Content

Most brands right now use branded content to game Google, rise above the noise and gain visibility. Branded entertainment though has managed to become much more important than this as consumers, and especially younger consumers, expect their favorite brands to provide both practical information and entertainment.

At a panel on branded content, Richard Ascott, head of digital at Alfred Dunhill emphasized the importance of transparency: “At Dunhill, transparency is key to interacting with consumers. Dunhill’s content need only embody the brand’s values. It is not ‘commercial’ in that it does not feature our products. Don’t create an advertisement that pretends to be a film when there is no narrative.” He also reinforced the need to be consistent in the communication with the customers online. If you can’t be really present, it’s best to stay silent.
Cecilia Pagkalinawan, founder/CEO at Styletrek noted that it’s not only retailers trying to push their sales with the use of content but also content creators becoming e-retailers with major publishing houses setting up shops. She also reminded us that the daily posts on Facebook and tweets are branded content as well and therefore it is vital to think through who will be the voice of your brand, instead of just “giving it away” to an intern.

Christine Downton, global CRM and internet strategy for Jaguar Land Rover suggested that brands should not think about ways to beat “noise” online, but ways to use it to their advantage; find the conversations happening online and join them. Jaguar Land Rover for instance does not only put emphasis on Facebook and Twitter, but also YouTube and Wikipedia, a more integrated approach using content through different channels.

Kirsten Spence, digital brand and operations manager at Jumeirah Group added: “Don’t always do the hard sell; give information, find out hot topics and give your view”.

Luxry Brands & Social Commerce

Luxury brands were late to join e-commerce; it was the success of NET-A-PORTER that served as a wake up call for most of them. Tamar Koifman, strategist at Digital Luxury Group shared simple tips for easy and cost effective content strategy.

As Alexandre Meerson said: “There is no “golden pixel” on the Internet and there is little or no difference in the look of the Zara website or the Louis Vuitton site.” The challenge luxury brands face is to become relevant again, focus on their identity and not just their look, invest in communication and offer high quality customer service online. Alexandre Meerson urged brands to rethink the information the customer needs and the best way to present that, “escaping” the idea that mentioning information like price and delivery cost and information is a taboo. “You have information on your products no one else has, then how come you display the same info as your resellers” said Meerson, emphasizing the importance of storytelling within an e-commerce site. He also encouraged brands to bring in new faces, and this way bring new ideas, experts in multichannel commerce, outside the luxury industry.

Ian Jindal, consultant and editor-in-chief at Internet Retailing noted: “Social commerce is already here. 25% of brands are using social media but they don’t know how to measure ROI.” He added that brands need to identify their customer and his social habits; for instance, the move from TV and web towards mobile in younger demographics. In a world where narrative is no longer owned by the brand, he concluded: “The best thing to do is open your sites to your customers, as they can drive sales and speak more effectively than your marketers.”

Luxury Brands & Gen Z Consumers

Research by ESSEC MBA in luxury brand management students on generation Z gathered a lot of attention as it profiled the future luxury consumer. According to the research, Gen Z spent 170 Billion USD globally last year. They represent overall 21% of the global population. Gen Z has high standards when it comes to engaging with a brand and are more brand driven than product driven. Gen Z is more than happy to share personal information as long as they get something in return. The emotional triggers for Gen Z are completely different than other demographic and they are great fans of branded entertainment, and product placement in music videos seems to be particularly effective with Gen Z.

Luxury Brands & Social CRM

Social media has proved useful as a “bridge” between brands and customers. Great service, but also personal relationships play a key part in buying decisions, the making of loyal, returning customers and may even influence the amount of money a consumer spends on a brand. Milton Pedraza highlighted the importance of personal relationships between brand representatives and customers, and encouraged brands to support their representatives by providing them the right tools to cultivate these relationships on and off line: “Make it easy for your customers, not just to access a brand representative, but to access THE brand representative the person has a relationship with, at all times.”

Pablo Mauron of Digital Luxury Group, who talked about how Tag Heuer leverages social media to enhance user experience and increase SEO, made a point that if you rely on third party platforms like Facebook alone, you are left without a rich customer database as all data belong to Facebook and you can not follow up once you lose a fan there.

Mr. Mauron suggested driving your fans to your website instead and using social networks to increase your visibility, integrating them in certain sections in order to bring added value.

Caroline Rolfe, e-commerce manager at Links of London reminded us that brands need to keep service at the heart of all new ideas. Links of London has integrated customer service into all social media channels and encourages their in-store sales associates to be active on social media as well. In return, Facebook fans came to the rescue of the brand when things got out of hand on their treasure hunt.

Like all brands, luxury brands must seek inspiration outside the luxury industry

Most brands look outside their industry for inspiration and great examples to follow. The most talked about brands outside the luxury industry, apart from the classic examples of Zappos and Apple, were Adidas+ for its application of AR, as mentioned in the Boucheron presentation, Tesco as a multichannel marketer for their mobile app for use in store, Jack Wills as a multichannel marketer as well, ASOS for their F-commerce and use of social media, as well as two of my favorite start-ups, Moxsie and Modcloth that were mentioned again and again for their vibrant communities and excellent integration of social media.

Luxury Brands, Facebook & Privacy

Most brands were passionate advocates of Facebook, on which they seemed to focus mainly for their social presence online, but there was also an obvious concern about the non-stop changes Facebook makes on privacy settings and the way features work. Steven Donald, vice president-innovation products at Deutsche Telecom claimed that: “Brands have discovered Facebook and they are using Facebook because it is the only show in town,” and mention that his company is looking into providing brands a private channel to connect with their clients on a different level: “Niche communities will really blossom in the next three to four years and we are preparing the tools now.” Shenan Reed of Morpheus Media urged brands not to be Facebook obsessed, but to keep their eyes open for the next Facebook, the next big thing.

 

Post By Amalia Agathou

An information and communication systems engineer irresistibly attracted to the fashion world, Agathou landed her job as an editor at Glamour Magazine in Greece. Agathou also writes for TheNextWeb, where she works as a community and marketing manager. You can read some of her posts for TheNextWeb. You can follow Agathou on Twitter @Amalucky.

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