Luxury retail is having a moment online.
Running contrary to naysayers’ contentions that consumers want to have a brand shopping “experience” in a store—to see and touch high-end goods, to interact with knowledgeable store staff, etc.—e-commerce’s share of the total luxury market continues to inch upward. Investment firm Bain & Co. estimates 6.9% of money spent on luxury goods in 2016 was spent online, up from 5.8% a year earlier, even as luxury sales overall slipped slightly.
Innovators in the luxury market online are demonstrating how to capture consumers’ interest online—and convert them into buyers without the in-store visit. Three such online retailers are included in the 2018 Hot 100 listing of innovative online retailers: Farfetch, Orchard Mile and 24 Sevres.
The London-based Farfetch UK Ltd. deploys a content-rich, high-polish e-commerce site to court upmarket apparel buyers. “Inspirational content is a natural and important part of any luxury customer’s shopping experience; customers want to feel connected,” says Stephanie Phair, chief strategy officer of Farfetch, which is No. 89 in the Internet Retailer Europe 500 rankings of the largest online retailers in Europe by sales.
To that end, the site feels more like a luxury magazine, replete with an editorial section that features interviews with designers such as Stella McCartney and articles about upscale events. “We have an amazing in-house editorial and design team that handles everything from the creative direction of the photoshoots you see on site, home page layouts and writing features and content,” Phair says.
Conde Nast staff provide content for Farfetch as well, under an arrangement Farfetch made with the publisher last summer when it purchased the rights to the Style.com domain name. Style.com now redirects to Farfetch.com.
Farfetch, after 10 years in business, is now targeting Asia—a hot market for luxury goods—for the next phase of its growth. Chinese online retailer JD.com invested $397 million in Farfetch last year, which Farfetch will use to build its brand in China.
24 Sevres, named after the Paris address of the Le Bon Marche department store, aims to bring the best of in store, online. Luxury conglomerate LVMH Moët Hennessy Louis Vuitton SA, No. 44 in the Europe 500, launched 24Sevres.com last May, selling goods from 150 high-end brands, including brands LVMH owns and competing brands owned by others such as Gucci and Prada. Throughout the website, shoppers can see drawings of the store’s architecturally striking exterior and interior. Further, to try to deliver the high-touch service consumers might find in store, online shoppers can video chat with personal shoppers in Paris to find the goods they want to buy. They can also call personal shoppers on the phone, interact with them via live chat or interact with a “style bot” on Facebook Messenger.
We give them the universe, but make it really easy to shop.
Luxury marketplace Orchard Mile, meanwhile, applies technology to better personalize consumers’ shopping journeys on the site. Orchard Mile features products from more than 150 brands and merchants selling through the site, and consumers can buy from across these brands with one checkout.
To help consumers sort through its deep catalog, Orchard Mile launched My Mile last June, says CEO Jennie Baik. My Mile is a personalized feed of suggested products that a registered shopper can filter by designer or size.
“The issue with marketplaces is that there’s so many products, so how do you dig through all that? We don’t get rewarded for offering more SKUs,” Baik says. “My Mile is the answer to that. We give them the universe, but make it really easy to shop.”
With luxury e-commerce on the upswing, it is online retailers like Farfetch, 24 Sevres and Orchard Mile who are leading the way.
To read more about these companies and other innovative online retailers, download the free issue of Internet Retailer’s 2018 Hot 100.Favorite