User Experience and Luxury Brands: Common UX Challenges
Historically, traditional luxury brands were reluctant to sell items online. There’s the fear of online retailers selling counterfeit products and the old-age myth that consumers will not buy luxury goods online.
Luxury brands are driven by art, design, and exceptional customer experiences, something that is evident in their physical stores. In the new digital reality, many luxury brands have been swift to adapt and overcome their fears, but this industry has many unique challenges around user experience and website design.
Currently, luxury online sales make up 8% of total luxury sales, but 70% of consumers say they are influenced by online interactions before deciding on a purchase. 8% may not seem like a compelling enough statistic to invest in UX design and improving web performance, but the online sales share is expected to grow to 25% by 2025. During the same period, department stores will likely see their share of sales drop from 23% to 13% and monobrand stores will see their shares slide from 30% to 25%.
As more online luxury retailers enter the market, like Net-a-Porter, FarFetch, and The RealReal, heritage luxury brands stand to lose if they do not shift their focus to online shopping experiences to match their digitally savvy customers.
Top UX Challenges
Embracing Ecommerce and the See-Now-Buy-Now Consumer
Traditionally, high-end fashion brands present their new line in runway shows months before its available for purchase to their top clients. This model is being disrupted by the see-now-buy-now consumer, forcing designers to realign their model with the needs of their customers. In 2016, Gucci became one of the first to do so. With the growth in ecommerce and social media, the bottom 80% of consumers can now quickly access images and videos of a brand’s latest line of products. As a result, customer demand and the need for instant gratification increases.
Legacy luxury brands who rest on their laurels and rely on their reputation to drive sales in lieu of investing in online experiences will quickly find themselves behind the pack. With the internet, consumers now have the power of information to find luxury companies outside of the usual household names. Upstart challenger companies that have the ability to create luxury goods at a faster rate and better price point offer a realistic threat.
Balancing Branded Content and User Experience
When driving sales on an ecommerce site, it is as much about form as it is about functionality. While almost every consumer owns a smartphone, luxury consumers are especially digitally affluent and carry higher expectations than the average consumer.
Too often, luxury brands fall victim to one of two scenarios: they offer high-quality images and videos but lack the functionality for customers to make an online purchase, or they have the functionality but lack a compelling design to enable conversion.
One example of the former is Chanel. When you enter the Chanel website, you are immediately hit with high-quality images and videos of its latest runway show. It’s easy to see the investment the brand made into its design and content, and likely one of the reasons they are one of the most followed luxury fashion brands on social media.
What Chanel offers in content, it equally lacks in functionality. The brand has stuck by its strategy of only offering its luxury products for purchase in physical stores, fearing the brand would lose the exclusivity factor if it rolled out an online store. Even with its recent partnership with FarFetch, President Bruno Pavlovsky only plans to leverage its technology for the in-store experience: “We are not starting to sell Chanel on the Farfetch marketplace — I want to be very clear on that. Our position on e-commerce is the same. We want to connect our customers with our product and our boutiques are the best way to do so.”
Not all luxury companies agree with this approach. Estée Lauder, for example, has grown its ecommerce sales to 11%, three percentage points higher than the luxury sales average. In China, the company’s third-largest market, web sales have doubled. Its products are sold in stores in over 170 Chinese cities, but “the opportunity to grow new customers comes from cities we do not operate today,” says Dennis McEniry, President of Online at Estée Lauder.
In contrast, some luxury brands have made functionality a priority on their ecommerce sites, forgetting about the significance of branded content. In a recent benchmark study of the top luxury ecommerce sites, 25% have zero product storytelling, and 60% do not have in-situation product images. If you are shopping for jewelry online, not only will you want to see the details of the item, such as the diamond cut, but you also want to see how it’s worn or used by a person.
Product descriptions are equally essential to balance functionality. Descriptions are an opportunity to give your sales pitch and evoke an emotional connection with the consumer, resulting in a higher conversion rate. Rather than focusing on a list of features and technical details, descriptions are more persuasive when they entail how the product is made, how it can be styled, why it was made this way, or how to best use it.
Longer Consideration Cycle
Luxury brands typically face the challenge of longer customer consideration cycles compared to other verticals. When shopping online, a $5,000 handbag would indicate to most customers that they need to do more research before purchasing, compared to a $20 t-shirt.
Nearly 80% of consumers are digitally influenced, hitting one or more digital touch-point before making a purchase decision. Some experts have the average number of touchpoints as high as 15 (half or more being digital) for luxury retailers, more than twice the average of touchpoints for non-luxury retailers. As a result, digital strategies, such as retargeting, SEO, and email marketing, require more investment for luxury companies.
Luxury ecommerce sites have three user personas: Whales, Middle Class, and Window Shoppers. How does a brand create a user experience that is personalized for each persona? And are they all equal?
The term “whales” refers to the ultimate luxury shopper. They are big spenders who do not need to think twice about buying a $10,000 watch. For luxury, whales, equivalent to the top 20% of customers, make up 80% of the company’s revenue. For example, Tiffany & Co.’s top 20% customers spent an average of $4300 each in 2016. In comparison, its middle-tier customers spent on average $300 in 2016. Whales will have the highest of expectations compared to the other two personas, expecting their online experience to be as lavish and personalized as their in-store experience.
These are the shoppers who have their “moments of wealth.” They typically save for a particular luxury product but do not frequently buy from luxury brands. Understanding what items they are saving for and when they plan to buy will be key for luxury brands to increase conversion with this user persona.
These are the consumers who yearn to possess luxury items but do not have the means to do so. Although they are not ready to buy luxury products now, they could be in the future. During the time it takes for these shoppers to consider their options and waiting to have the means to purchase, luxury brands and retailers have a window to grow their brand awareness.
Asking for a small action, such as following on Instagram, is the first step for luxury brands to engage with window shoppers. This is where providing compelling branded content becomes key. As we mentioned, Chanel has the most Instagram followers of any luxury brand likely due to their attention-grabbing posts. Chances are many, if not majority, of the 25+ million followers have never made a Chanel purchase. Instagram has allowed the brand to capture a massive audience that it can leverage to grow its awareness through word-of-mouth and interaction.
Without an online wishlist, creating a personalized experience for each of these personas becomes onerous. Wishlists help determine which product type a customer prefers, demographics data like their gender and budget, and capture email addresses. With an email address, retailers can segment their customers and target based on what’s in their wishlists.
Luxury customers are accustomed to posh and personalized shopping experiences and expect the same exceptional experience with customer service. Of course, there are particular aspects of the in-store customer service that are not possible to emulate online, such as offering a glass of champagne or having plush white sofas. However, the concept of having a personal stylist online has become possible in recent years.
Since 2013, Salesfloor has been enabling luxury retailers and monobrand stores to connect their sales associates with their customers both in-store and online. Saks Fifth Avenue leverages this platform to take their clienteling to the next level. For example, if a customer’s favorite personal stylist is in the New York City location, but they live in Atlanta, they have the ability to shop online with the New York personal stylist online. Additionally, with Salesfloor, customers can shop online from in-store, associates can take pictures of outfits and send them directly to clients with a link to purchase, and customers can crowdsource suggestions from all of the Saks associates.
In the past, the data a sales associate gathers in-store from their clients were lost and impossible to leverage online. With Salesfloor, or other similar platforms, the gap is closed between in-store and online intel. Customers can now have the luxurious experience of having their own personalized stylist (not virtual, but an actual human) from their own home.
More and more luxury brands are leveraging ecommerce to create luxurious online experiences and enhance the customer’s in-store experience. While luxury faces their own unique UX challenges, they are not impossible to overcome. Great UX design is always in fashion.
2018 Luxury Report
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