The luxury market is resilient because there is always a high demand for luxury goods, even in times of economic uncertainty. But in this current climate, even luxury brands need to rethink their e-commerce strategies to ensure their industry remains buoyant in these challenging times.
The challenges luxury brands are facing stem from the impact of the pandemic but also the post-Brexit fallout. Covid-19 has forced many luxury brands to accelerate their progression onto the eCommerce landscape and work out how to deliver the luxury experiences their customers were used to via an online service.
International luxury brands are taking a leaf out of successful eCommerce brands in China by engaging customers through apps, live video chat, rewards and elements using AI and augmented reality tech. Digital mirrors and virtual ‘try ons’, including clothes, accessories, and even diamond rings, are helping luxury brands create an online shopping experience like no other.
All this delivers a higher level of personalised service, which is part of the luxury buying experience.
The strategy developed to help ensure luxury brands continue to boom despite the economic uncertainty is to provide an online service that helps prove to customers that the item they are purchasing is genuine and not fake!
Luxury brands like Louis Vuitton, Cartier and Prada have joined forces (through LVMH) to create a non-profit organisation called Aura Blockchain Consortium to use blockchain technology and prevent counterfeit goods from being sold in the luxury eCommerce market.
The Aura website says, “The Aura Blockchain Consortium was born from a vision that collaboration with the competition can coexist for the greater good. We value trust, sustainability, innovation, and collaborative decisions to enhance the luxury experience of our customers.”
Microsoft and ConsenSys developed the technology, and the system uses a similar platform that controls cryptocurrencies. The tech enables customers to check the proof of authenticity and the history via a digital certificate produced on purchase. Products will include a unique identifier such as a serial number or NFC chip linked to the relating certificate on the blockchain.
The future of luxury retail stores remains uncertain.
Traditional bricks and mortar stores were already facing challenges before the pandemic and Brexit. Over the last decade and more, we have seen brands we considered strong go under due to the surge of online shopping and economic uncertainty, followed by Brexit and, most recently, a global pandemic.
Even brands such as Lulu Guinness found themselves victims of the Covid-19 pandemic. Despite only having one main store, they could have ended up closing the brand down had they not found a way to save themselves and re-strategise to pull themselves back to pre-pandemic stability.
The challenges that businesses have faced so far during the 21st century have been epic. With recessions, referendums, and global pandemics which, have resulted in another recession. The ones who will survive will do so because they continually review their strategy, provide the best experience for their customers and stay current whilst always looking to the future.
Luxury Brands Develop New Post-Brexit And Pandemic Strategies.
As the MD of London Diamonds, James Sanders knows all too well, offering an omnichannel approach to delivering luxury goods and services is a winning strategy for creating a loyal customer base. The level of service, quality, and willingness to provide that bespoke, personal service all create the brand experience.
The current trading wars between China, America, Europe and the UK (because of Brexit) are all impacting luxury brands. With changes to tariffs, restrictions on imports and a whole host of new red tape to cut through, all whilst trying to navigate the choppy waters of a global pandemic.
Luxury brands must adapt to the new age of the consumer to be more transparent, engaging and customer-focused. Ensuring a cohesive brand message is shared across all marketing and advertising, remaining authentic and approachable. Customers seek an immersive experience when they buy into luxury brands, and the survival strategies post-Brexit and pandemic need to reflect these elements to continue to thrive.