Luxury brands should embrace eCommerce to engage customers, report says

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eCommerce is an opportunity many luxury retailers have been hesitant to embrace. But with the market set to explode, new research shows that thanks to information about their customers’ online activity luxury retailers have the opportunity to know 80% of their in-store customers by name.

The research, Digital Frontier 2016: Digital luxury is turning mainstream, by Contactlab in conjunction with Exane BNP Paribas, showed that brands must work harder to embrace the opportunities of connecting eCommerce with their stores when it comes to providing an integrated sales and marketing experience.

The report shows that digitally contactable customers account for 27% of instore revenue and nearly three-quarters (73%) of eCommerce revenue. These customers also have a rate of cross-channel spending which is 50% higher than in-store only customers.

Digital profiles key to success

“Luxury brands need to shift their perception and open their eyes to the mutual benefits of engaging with digital customers," Massimo Fubini, CEO of Contactlab, said.

"Digital contact with customers is transforming the luxury industry and with the rise of eCommerce and digital engagement tools, luxury brands are gifted with information from customers’ online activity, allowing them to know 80% of their in-store customers by name. A luxury brand’s success is based on its ability to leverage customers’ digital profiles and purchasing decisions in order to tailor engagement," he added. 

Fubini said that retailers could gain more sales by driving anonymous consumers to a more engaged, cross-channel relationship. “In-store digitally contactable customers spend 20% more than those who are simply registered and those known customers who buy both in-store and online spend even more.

By ignoring online channels through which they can engage anywhere with customers, brands are leaving a blind spot which does not allow them to get an accurate image of their customers’ profile, behaviour, and preferences,” he said. 

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Frank Viljoen
16 Jun 2016, 9:27 a.m.

Beacons can provide a highly personalised and discreet concierge service as well as linking the consumers online e-commerce behaviour with their offline presence. This all adds to building a stronger 1-2-1 relationship leading to an increase in spend and loyalty to the brand.

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