Richemont Readings
north american luxury industry news curated by iProspect
Welcome to iProspect's August Newsletter
This month's newsletter is covering several topics that have circulated the industry and our agency walls over the summer. Prepare yourself for a lot of great information - inclusive of luxury industry trends (the push for digital innovation, ecommerce enablement, preowned/sharing economy), convenient compilations of top videos from luxury timepiece brands, holiday forecasts/need to know advice, the latest consumer studies on UHNWs and affluent millennials, and iProspect's PPC and Social channel updates.
As always, if there is ever something we haven't covered, please let us know and we'll be sure to include it for the group in a future newsletter. For your convenience, previous editions are linked on the bottom should you need to reference again and/or share with colleagues.
Andrea
P.S. Please be on the lookout for an email from Satrix Solutions this week to complete a very short client satisfaction survey. This survey helps us gauge iProspect's Net Promoter score and makes us better for you! Survey closes Sept 18th.
-----LUXURY INDUSTRY UPDATES-----
Luxury Retail's Digital Moment
Survey based insights taken from 2014 Luxury Interactive. Key findings include:
- 92% of luxury retail marketers increased digital marketing investment in 2014
- 77% say increasing brand awareness is their primary goal, 60% say driving trackable conversions
- 59% prioritize retargeting. Additional priorities include real time targeting (52%, real time optimization (44%), mobile (37%), display banners (33%), video (26%).
Link to pdf of study here
State of Social in Luxury - 1H 2015
In the first half of 2015, the luxury industry outpaced the growth of U.S. brands, increasing by 94% year over year compared to 53% for all U.S. social pages. Instagram was the driving force behind this growth with actions increasing by 169% despite
content growing by only 31%. Indeed, for luxury brands, Instagram is where majority of consumer engagement is happening capturing 80% of all actions--a jump from 58% in H1 2014.
The Shareablee State of Social: Luxury Industry Fact Book for H1 2015 unpacks the social growth of the industry, reveals the categories and brands that are propelling the industry forward, and examines the content that is resonating most with consumers.
YoY Growth of Actions, Content and Actions per Post below
A Wake Up Call to Luxury Brands
A new report from McKinsey & Co. finds that it is a mistake for luxury brands to do anything other than wholeheartedly embrace the online channel as a crucial opportunity for ringing up sales and influencing in-store purchases.
“It’s a quite traditional industry where customer experience has always been paramount,” said Nathalie Remy, one of the report’s authors. “But today, the definition of customer service for the 21st-century shopper is not exactly what it used to be.”
Link to Washington Post article here
LInk to similar PSFK article link here
Luxury Must Take Hold of its Digital Destiny
Luxury companies have long relied on “heritage” to lend prestige to their products. But heritage without innovation can quickly start to feel dusty and dated. Of course, leading luxury brands are harnessing the power of the Internet to drive exciting new innovations in e-commerce and online communications. Yet these same brands are largely missing the opportunity to embed technology into core business thinking and create new and innovative products and services.
Link to Business of Fashion article here
Luxury's Emerging Identity Crisis
- Blurred online Consumers, spoiled by the speed and efficiency provided by startups, started to expect the same thing from the established luxury brands.
- From conventional to timely - to stay timeless, today’s luxury brands need to be timely, deeply rooted in the zeitgeist and cultural references of the moment.
- From inaccessible to attainable - Smart luxury brands’ strategies today shift codes of exclusivity into signifiers of personal quality of life, individual reward and exceptional lifestyle.
- From communications to marketing - Armed with data, experiential approach and omnichannel presence, luxury brands are in the position to confidently exert their cultural influence and create a powerful, overarching lifestyle narrative that inspires, entertains and informs.
- From products to services- the rise of hybrid luxury, where products, services and experiences merge.
- From status symbols to culture codes - A true luxury today is about experiences that fill us with pleasure with our own life, spiritually, mentally and physically enrich us, and which are best enjoyed in private or with a few selected others.
Link to Luxury Daily article here
Pyramid of Luxury Brands
Link to Business Insider article here, image of pyramid below.
-----BEST OF BRANDING & VIDEO -----
Top 10 Jewelry & Watch Brand Efforts of H1 2015
Link to Luxury Daily article here
Luxury Timepiece Brands Using Craftsmanship in Video
View videos conveniently on one link from Audemars Piguet, Baume & Mercier, Cartier, CHANEL, Chopard, Ebel, Roger Dubuis, Jacquet Droz, Frederique Constant, Girard Perregaux, Hublot, IWC, Jaeger-LeCoultre, Louis Vuitton, Maurice Lacroix, Omega, Piaget, Raymond Weil, TAG Heuer, Vacheron Constantin, Van Cleef & Arpels, and Zenith.
Link to Luxury Society compilation here
Luxury Brand Videos
We have mused before that video lends itself particularly well to the complicated nature of timepieces and fine jewellery, as a way to simplify technicality whilst maintaining a vision of luxury. This is something luxury brands have traditionally achieved at store level, but as stores move further online, video is being used to bridge the gap between remote accessibility and personal service. YouTube has been around for Internet eons now, so why the sudden interest in branded videos by all kinds of luxury players?
View videos from Breitling, Bulgari, Cartier, Girard-Perregaux, Harry Winston, Hublot, IWC, Jaeger-LeCoultre, Jaquet-Droz, Longines, Omega, Piaget, Raymond Weil, Roger Dubuis, Rolex, TAG Heuer and Van Cleef & Arpels.
Link to Luxury Society article here
Blancpain Shares Heritage Through Extensive Historical Video
Swiss watchmaker Blancpain is taking consumers into the heart of its creations with a new craftsmanship video that gets up close and personal with the history and heritage of its products. “Innovation is Our Tradition” goes beyond the face of the watch to dive deep into its inner workings and show the viewer the effort that has gone into the creation of its timepieces since the Blancpain’s founding in 1735. Sharing this intimate vision of the brand with consumers can help establish an emotional connection and fortify consumer loyalty.
Link to Luxury Daily article here, and video below.
-----HOLIDAY-----
eMarketer's Holiday Forecast +5.7% Growth - Highest since 2011
While US retail ecommerce holiday season sales growth will dip slightly this year to 13.9%, vs. 14.4% in 2014, the segment will play an increasingly important role this season. eMarketer estimates that ecommerce will hit 9.0% of total retail sales this season, or $79.40 billion, up from 8.3% share last year.
Holiday Shopping Forecast in 5 Charts
Here’s what retailers can expect from this holiday season, in five charts. Highlights include:
- The e-commerce industry is steadily growing, faster than expected (+72% for 2015)
- Holiday spending is increasing as well (online +6.8%, in-store +4% YoY for 2014)
- Session length, pageviews and product views per session are decreasing, while bounch rate and shopping card abandonment is increasing (over past 2 years)
- Mobile sales and traffic are growing - expected to make up 50% of all traffic to retail sites this December
- Desktop is used most (54% of time), followed by mobile (34%) then tablet (13%) - Mar 2015. Mobile is used for inspiration and research in order to make purchases later.
Link to Digiday article here
Online Holiday Shopping Recap/Benchmark Report
Downloadable version of IBM study here
Five Holiday Shopping Trends to Watch in 2015
- The most connected holiday shopping season ever
- Big money through small screens
- Holiday shopping begins long before Black Friday
- Brand loyalties are up for grabs
- Holiday shoppers turned to YouTube videos
Link to Think with Google interactive infographic here
Five Must Know Holiday Lessons & Benchmark Experian Study
- Move over desktops, consumers are using mobile to search for deals
- Must have gifts of 2014 - internet of things
- Reach consumers later in the week
- Email is the second biggest driver of traffic
- Mobile is a strong driver of traffic to retail sites
Link to Experian article here, link to webinar to prepare for 2015 here.
-----CONSUMERS-----
High Income Tops High Wealth for Luxury Purchase Intent
Sixty-nine percent of those with a household income of $500,000 or more bought at least one luxury product within the past 12 months, with only 49 percent of those with a net worth of at least $1 million able to say the same. These consumers are purchasing more frequently than their less affluent counterparts, but their small populations require a strategic, personalized marketing approach.
Link to Luxury Daily article here
Decades of Wealth: The Next 10 Years
The number of millionaires in the world is set to rise – and with it, opportunities for luxury brands to capitalize and further expand their empires – according to a new report released by Wealth-X. The report, ‘Decades of Wealth: The Next 10 Years In Wealth & Luxury’, offers a roadmap into the foreseeable future of Ultra-High-Net-Worth-Individual (UHNWI) wealth and highlights some key areas of evolution to watch for.
Overall, the report confirms that millionaires are on the rise, with the surge to continue as businesses are bought and sold and family inheritances are passed on – in total, Wealth-X expects US$4.1 trillion will be transferred globally by UNHWIs over the next decade, including US$1.2 trillion in liquid assets. However, while UHNWIs – in this case, defined as those having net assets of $30 million or more – will surge, an evolution in terms of consumer behavior, country of origin and and the use of wealth is set to sweep this new generation.
Key Implications for Servicing the Ultra Wealthy:
- Localization
- Pushing Extremes/Frontiers
- Experiential vs Product Purchasing
- Exclusivity/Personalization
- Intimacy/Privacy
Link to Luxury Society article here, link to Wealth X study here.
The Case For Winning Over Affluent Millennials
The lucrative affluent millennials set is a coveted target market – but how can luxury brands ensure they effectively capture their attention and brand loyalty?
Millennial affluence is a growing focus among some of the top brands and marketers today. As millennials are quickly becoming the largest generation by population size, many of them are obtaining higher levels of affluence and are affecting the way premier and luxury brands are approaching their consumers.
According to our latest FutureCast study, Money Matters: How Affluent Millennials are Living the Millennial Dream, there are about 6.2 million millennial households that report earning an annual household income of at least $100,000. Even more shocking than this number itself is the fact that this massive group of people is expected to continue to grow and is set to become the most significant audience for luxury-brands within the next five years.
Link to Luxury Society article here
-----iPROSPECT POVs-----
PPC Trends - 2015 Q2
- iProspect’s second quarter, year-over-year (2014/2015) Google AdWords data showed the gap between mobile device spend continues to edge closer, with spend on computers now making up just 60% of total search spend.
- Mobile search activity continues to grow rapidly, recording a 76% search spend increase over Q2 2014.
- Spend on paid search in Q2 2015 grew by 11% YoY, following a trend of linear growth over the past few quarters.
- We expect Google and Bing to continue leveraging the declared intent of keywords and in turn, offering advertisers new vertical-specific ad units that are even more relevant.
Link to iProspect blog commentary and downloadable findings here
Paid Social Updates
-----PREVIOUS NEWSLETTERS---
-----YOUR iPROSPECT SENIOR TEAM-----
Amanda DeVincentis
Dessa Lambert
About iProspect
Email: richemont@iprospect.com
Website: iProspect.com
Location: 150 e W 42nd St, New York, NY, United States
Phone: 917.326.2707
Facebook: facebook.com/iprospect
Twitter: @iProspect