It is luxurious, however not as we all know it: How luxurious manufacturers are embracing new digital platforms and media
Words from Lidi Grimaldi, Managing Director at Interbrand Milan
Luxury brands have long been associated with heritage, traditional fashion houses, and established orthodoxy of quality and art. It is this reliability and implicit trust in the excellence of luxury brands that have helped this sector remain stable in the most difficult times.
Nine luxury brands are included in Interbrand’s 100 Best Global Brands 2020 report. For the past two years, luxury brands outperformed all other sectors in this study, but this year all top brands have seen a decrease in value or have remained static. This is the impact of this global pandemic.
Although the leading luxury brands have declined in value, the resilience and ambition of this cohort has helped protect them from the harsh economic conditions. Because despite this year’s extraordinary crisis, a force of change is pulling through the sector – and not even Covid-19 can derail it. The shift in the luxury industry has resulted in even the oldest and most established brands – as well as newer entrants – embracing new platforms and media.
As we set a new tone for this era of luxury, we’ve seen brands use everything from games to SnapChat, digital fashion weeks to TikTok to explore new ways of customer interaction and branding. However, there is a balance between maintaining desirability and relevance, pursuing a new goal, and democratization.
Luxury fashion brands are joining TikTok en masse to reach the captive audience of 800 million monthly users around the world. Photo credit: tanaonte / Bigstock.com
Based on the fact that e-commerce and omnichannel are just as important to luxury brands as any other, traditional as well as digitally native brands have developed strategies and explored new ways to be present and relevant to people – perfectly demonstrated with the revamped fashion shows where the theater and the unveiling were recorded online.
In June, London Fashion Week kicked off the transition from analog to digital when this year’s gender-specific fashion designs were shared on multiple channels including zoom, live streaming and podcasts. Many welcomed the rethink required by Covid as a positive step, making the event more inclusive and less restrictive for designers, which was previously limited to the confines of catwalk venues.
Prada went one step further. Rather than simply posting his show online, it took questions from the public and put them to designers Miuccia Prada and Raf Simons in a live Q&A session. This has moved the brand one step further from its competitors to actively engage with consumers – with engagement being a major trend among winners of the best global brands this year.
Meanwhile, Burberry has invested $ 4,809 million in brand value in new forms of social economy. In July of this year, the company, in partnership with Tencent, opened its first social retail store in Shenzhen, China, bringing together physical and social networks for a more digital retail experience. A special WeChat program enables business customers to access exclusive content and personalized experiences that they can share on social media. Burberry CEO Marco Gobbetti said the deal has redefined luxury retail expectations and a change in the way the brand treats its customers.
Burberry has invested in new forms of social economy with a brand value of $ 4,809 million. Photo credit: toxawww / Bigstock.com
Throughout history, crises have proven to be platforms for creativity and innovation. While luxury brands began to expand into new areas and digital realities, the pandemic has accelerated that shift. Gucci had demonstrated ingenuity and willingness to develop new shapes and responses with its Gucci 9 virtual customer service center, and this was accelerated in response to this year’s challenges.
This service enables customers to video call customer agents in real time and talk to them in a Gucci 9 virtual store designed with high quality cameras and standard TV lighting for remote shopping. The first opened in Florence, with others launched in locations such as Tokyo, Singapore and the United States around the world.
This philosophy was about using technology to find another way to connect the brand and its customers, and to ensure that brand values and expectations are met in both the virtual and physical worlds. It can also help Gucci meet customer demand and improve overall customer service.
No matter where luxury brands expand online, the driving force remains where the customers are. It just requires an understanding of what people expect in these environments, and this can be vastly different from the advertising and promotions that the fashion brands create for more traditional media.
Gucci has demonstrated ingenuity and willingness to expand to new shapes and ways of responding with its Gucci 9 virtual customer service center. This has been accelerated in response to this year’s challenges. Photo credit: MarlonTrottmann / Bigstock.com
Even if SnapChat and TikTok aren’t instant natural homes for high-end brands from Gucci to Tiffany, the leading luxury companies have shown what is possible, adapting content and tone of voice to the social media platforms. TikTok unveiled its own version of the digital fashion month, with Saint Laurent and JW Anderson being among the first to showcase collections on the platform. Prada went cross-platform when it launched a new collection, streamed for the first time alongside Instagram and Prada.com on TikTok.
Perhaps gambling is one of the most inopportune areas luxury has expanded into. With 2.5 billion video gamers, however, it’s no surprise that experimenting with games and gaming has its effects. Burberry, Gucci and Hermès all started games. Louis Vuitton has teamed up with Riot Games and Nintendo New Horizons players can customize outfits for characters in Chanel, Dior, Gucci and Prada.
Ultimately, luxury brands that have always been top-down are now completely changing and opening their customer communities to fuel engagement and create relevance. Nowadays, this falls far short of the excellence and exclusivity of their products and instead it’s about serving a real purpose and taking real steps. Luxury brands could remain desirable and ambitious while opening their platforms to new target groups and meeting their expectations.