Josh Stevenson
Social Media Director Verb Brands

It is fair to say there is a tendency in the luxury sector to assume the usual rules don’t apply to us – especially when it comes to social media. However, shopping is, and always has been a social experience. Ecommerce and social media is a pairing as natural as champagne and caviar, or a pea coat and roll neck.

This relationship has led to platforms such as Instagram cutting out the middleman and introducing their own shoppability features. The unprecedented growth of places where customers can now buy goods and experiences has made paying for goods via social media ubiquitous. 

But in the luxury sector, ubiquity is undesirable, and even a threat. So how can luxury brands ensure they retain exclusivity and brand equity without being left behind?

Retaining brand exclusivity

Within luxury, behaviours by cohort are very different. According to a BCG Consulting Insights event hosted last week at Facebook, Millennials will soon account for 50% of the market and account for 130% of growth. Gen Z’s market share is expected to triple by 2025. Both these cohorts have grown up with ubiquity, which has influenced how they interact with luxury brands. 

The new luxury customers now find exclusivity in the second-hand market, and look for more immersive experiences with their personal goods. This may be due to sustainability becoming more important to these customers, but luxury is already in a favourable position here. In fashion, in particular, luxury fashion stands out in comparison to fast fashion – with goods designed to last longer than low-cost high street alternatives, often already made from better quality materials from sustainable sources. To some extent, luxury exists because designers and innovators invested energy and ingenuity in beautiful, well-made products that were built to last.

eCommerce in China

China presents an intriguing study of selling via social media. With a completely different set of Chinese social media platforms, this establishes a uniquely different paradigm. With 80% of Chinese luxury consumers on social media, it not only influences luxury customers but provides end-to-end environments for them to purchase. For example, the Chinese Social media platform WeChat is its own entire ecosystem. With features to buy products online, pay for purchases in physical shops, sharing brand posts, messaging and more, it provides almost every touchpoint in the purchase process including E-commerce

So which brands have taken this insight to market? With the appointment of Riccardo Tisci as Creative Director, Burberry’s marketing team further strengthened the track record of their digital innovation, with their launch with the launch of their B-series line. The concept is simple: on the 17th of every month, Burberry releases an exclusive product or range of products, varying in size and scale for 24 hours only. Not only that – they are exclusively available through Burberry’s Instagram, WeChat, LINE and Kakao accounts. Limited product, limited time, limited distribution. The objective is to remain in constant communication with customers and create urgency and exclusivity for these products. The idea taps into three key insights: their customers desire for exclusivity, they want to use social media for both fashion inspiration and to make purchases, and finally, their customers wanting to be in constant communication with brands they love. Launching before Instagram introduced Shopping, the machine employed was Instagram Stories, whose ephemeral nature and 24-hour shelf life was a perfect fit. 

B-series has been a resounding success, with the majority of drops selling out in the 24-hour window. Commenting on the launch, Rachel Waller, VP of marketing and digital at Burberry, said:

“Burberry is always pushing for digital innovation that improves our customers’ experience. We have seen great results from the monthly B Series product drops which launched last September, bridging the journey from inspiration to ecommerce for our social community for the first time.”

Social Media insights for personalisation

Another challenge luxury marketers face is in personalisation. For those who have shopped in store for luxury items (e.g. luxury cars, designer clothing, high-end electronics), this experience is well-known. Customers may be paired with a personal shopper, offered refreshments, even encouraged to try out products before making a final decision.

Here’s the challenge: how do luxury retailers create the same premium experiences for online customers that they’ve become known for creating in-store?

The answer is simple: AI. One of the ways that luxury brands offer a personalised experience is through chatbots. In fact, luxury brands present one of the best use cases of chatbots, providing a personalised experience and direct path to purchase through social media channels.

Net-a-Porter, Audemars Piguet and Tommy Hilfiger, to name just a few, have leveraged AI and chatbots to great success.

Chatbot messages to customers

One of the most successful use of AI from a luxury retailer is Sephora with their Visual Artist product. 

“Digital and innovation have always been part of our DNA at Sephora,”

said Mary Beth Laughton, Sephora’s executive vice president of omni-retail.

“We are very focused on our customers, and we know that her life is increasingly reliant on digital. So we know to be successful as a retailer, we’ve got to be where our clients are, and give her tools and experiences that meet her needs.”

The tool uses AI technology to allow the user to see what various products would look like on them. Even better, it can detect the customer’s skin tone and suggest different shades accordingly. The experience is further enhanced with video tutorials and opportunities for customers to upload their own pictures and videos – again, keeping the communication two-way.  It works – personalised content increases the effectiveness of social CRM by up to 50%, according to the BCG Consulting Insights event. 

Social media not only increasingly influences purchase decisions but for brands willing to innovate, present huge opportunities at all stages of the marketing funnel. Luxury brands that understand their customer, can tread the fine line between retaining brand equity and exclusivity, personalised experiences, and use of technology, can reap the rewards of this ever-growing channel. 

Even if the usual rules don’t apply to us, the successful luxury brands are those that can work out how to take the learnings from the wider industry, and translate them to luxury. 

If you would like to find out more about how to use social commerce for your luxury brand, please get in touch.