Consumers shop very differently today. The trends that emerge will shape how well luxury ecommerce retailers will fare online. Here is what to consider:
After having been isolated for long periods of time, people seem to be falling into two main categories: those who are desperate to go shopping in person, and those who have become accustomed to shopping from home. Knowing which consumers fall into these two categories is critical for luxury ecommerce retailers.
Consumers who are ready to start shopping again may behave like consumers did in China when lockdowns were first lifted. A Hermes boutique in Guangzhou sold $2.7 million in merchandise in April on the day it reopened, and Tiffany’s May sales increased 90% in China compared to May 2019.
On the other end of the spectrum, consumers who remain less comfortable shopping in stores will seek understanding, comfort and empathy from brands with online stores.
Luxury ecommerce retailers must accommodate both behavior types.
Another factor to consider is how more remote work will continue to shift which items consumers purchase. When more time is spent on Zoom calls than in boardrooms, the emphasis on “waist-up” appearance may result in more spending on jewelry and other accessory purchases than on belts and shoes.
In their 2019 True-Luxury Consumer Insight Report, BCG and Altagamma identified that 60% of the highest-spending luxury customers are influenced by environmental, animal and ethical manufacturing concerns when making purchases, and this trend shows no sign of slowing down.
Luxury brands who have tied their image to conspicuous consumerism risk accusations of being out-of-touch, as younger consumers turn toward a more "conscientious consumerism."
Luxury ecommerce retailers can stay relevant in an increasingly conscious market by being transparent about their brand values, sustainable practices, and supported causes.
Consumers want to know what their money is supporting: By making them feel good about buying, luxury ecommerce businesses can give them a customer experience that's not just indulgent, but emotionally rewarding - creating fertile ground for unshakeable brand loyalty.
Luxury goods’ largest consumer group grew up in the digital age, so it should come as no surprise that they’ve taken to mobile and social commerce.
Our own research reveals 40% of consumers, regardless of age, always have their cell phone in hand when making an online purchase What's more, that number climbs to 47% when we talk about the highest spenders in our research.
What this means for global luxury brands is that it’s not enough to just have an ecommerce site. Not anymore.
They need to up the ante with a well-designed mobile site or app, and responsive social media.
The shift to apps and social media offers a payoff to luxury ecommerce retailers. These platforms allow for promotions, notifications, and auto-renewing subscriptions to turn one-time purchasers into loyal customers. Apps and social media also provide customer behavior insights that retailers can use to better target and serve their customers.
Fortunately, environmentally-minded consumers are seeing the value in buying quality, classic items that will last years. As expert brand strategy consultant Dr. Martina Olbertova told Forbes magazine in 2021, "There is always going to be demand for something that is handcrafted, premium quality and of lasting value.”
Gen Z, Gen Y, and millennial consumers have become quite conscious of how well their purchases will fare in the resale market. The emergence of designer consignment ecommerce stores has proven the value of reselling handbags, scarves, jewelry, watches, and other luxury items, while making luxury good accessible to more consumers and reducing waste.
Luxury ecommerce retailers will further endear themselves to customers by promoting the long-term value and timelessness of their products. Some luxury retailers will offer repair services to older or worn products to make sure consumers can resell them on secondary markets.