How Shoppers Buy Luxury Goods

chris-authorBy Chris Donnelly 


The digital influence factor & what marketers need to learn

The way buyers engage with luxury brands has changed rapidly in the era of digital; their purchasing behaviour, decision drivers and expectations have seen a monumental shift. Therefore, luxury brands need to reconnect with their consumers.

The evolution of digital platforms has arguably been the main driver of this change and continues to disrupt the fundamental workings of many businesses. Almost all buyers are digitally connected, they use multiple devices and either purchase online or use online services to research before they purchase in-store. This is especially true for luxury shoppers, who on average own 3.1 connected devices and 78% of them doing online research before buying luxury items.

According to recent Deloitte research, many retailers are failing to meet the digital expectations of their customers. For Luxury brands, that gap between what brands are offering and what customers are expecting, “The New digital divide” is putting far more at risk than just online purchasing revenue.

How do brands bridge this gap? How in the market today can brands best interact with their customers?

Our phones and our devices have become part of our everyday activities, customers are now truly at one with their technology and with the growing trend of wearable tech, this is only set to increase. Brands need to bring digital into the customer experience and focus upon the broader customer journey and all channels success, rather than simply an increase or decrease in conversion on a specific digital asset.

Digital Influence factor

Digital devices are changing the nature of human interaction and business transactions, it’s revolutionised other industries and is currently altering the fundamentals of the retail and luxury sphere. A reference point for a similar tectonic change caused by digital is the media industry (including film, television and music). The introduction of iTunes, Spotify, Netflix, Sky Go, BBC iPlayer, 4OD (to name a few) has forever changed how the industry acts and services it’s customers. The improvement of digital devices and content delivery have set a precedent, new digital expectations which customers now have of retail and luxury brands.

The positive effect of digital upon store traffic, conversion, order size and loyalty is clear and therefore brands need to focus on how best to serve their customers from a multi channel perspective. Too many brands are facing a serious threat by not serving their customers digital needs and losing out market share to strictly online retailers.

The influence that digital devices are having upon in-store purchases has out stripped any predictions, research shows that digital technologies influence 36% of 12.1 trillion in-store retail sales and this number will likely continue to increase.

Brands should take notice of this and see that digital channels should no longer be considered as a separate arm to the business, but be seen as fundamental to the entire customer experience, on web, on mobile and in store.

This furthermore draws into question the way in which businesses think, measure, and invest in digital to address their customer needs. The basic metrics must be addressed first; conversion, visits, pageviews, dwell time, however as the digital expectations of customers continue to grow, so should the emphasis brands are placing upon data-driven digital decisions.

luxury web design

How do shoppers use digital to research and buy luxury products? And how can brands reach and engage them?

Google teamed up with Ipsos to try to truly understand how affluent shoppers buy luxury goods. What they found was that almost all luxury buyers do research before purchasing and the internet constitutes half of their sources.

luxury web design

The above statistics only go to reinforce the digital influence factor. The research shows that affluent luxury buyers are extremely tech savvy and over 90% use a smartphone, tablet, laptop or desktop. Research is no longer confined to the store, and it’s no longer simply browsing on a website – it’s a full, immersive process where new age customers expect a flawless experience, in store, online and on their mobiles. To truly engage these customers, brands must understand this and must cater towards their customers needs.

The content that customers want to interact with has changed as well. It’s clear too that the luxury shoppers prefer more immersive advertising formats for luxury goods. Therefore again brands must realise that video, fullscreen content, 360 degree product views and essentially creating the most tangible online experience is the only way they will keep their consumers and capture more.

luxury web design

Is your brick-and-mortar strategy digitally savvy?

94% of retail transactions still take place in store, nurturing valuable customer relationships through digital clienteling makes them more likely to continue for a lifetime – “The New Digital Divide, 2014, Deloitte”

The influence digital devices are having upon in store purchases is growing faster than anyone could have predicted. It is at this point that brands must stop considering their digital channels as stand alone or separate businesses, digital is fundamental to the business as a whole and the entire research and shopping experience online and in store. Retailers (and especially luxury retailers) must acknowledge this change and reassess how they measure their success and their interaction with customers’ new digital needs.

luxury web design

What does this means for brands and marketers?

“The boom for luxury goods is unending. There are people who never have to worry about whether they can afford something they like. In one part of the world or another there will always be someone with the spend on luxury” – Diego Della Valle, President and CEO, Tod’s

As Diego writes, the luxury customer exists as they always have, they will continue to exist, and as a market it will continue to endure. The growth of wealth is a global phenomenon and the demand for luxury consumer goods is forecast to continue to grow significantly over the next decade and beyond. What brands and marketers alike need to learn is that the way in which luxury customers consume data and interact with product has seen a paradigm shift. As Google’s research shows, with wealth comes the highest level of tech savviness and this goes hand in hand with high, unrelenting expectations of how brands should act. To prevent themselves losing out, a broader, all encompassing digital strategy must be implemented. One that interacts with customers through all their touch points and serves them with the content that they are most likely to interact with.

  • Create a multi-screen opportunity: With affluent customers typically owning 3.1 devices and with luxury buyers reporting that they used at least 1 online resource before making a purchase, brands can no longer afford not to have a multi-screen approach.
  • Use engaging types of content: Video, fullscreen content, 360 degree product views to create an immersive feeling.
  • Combining online and in store: Stores must direct customers to engage digitally with incentives, engaging content and rewards schemes and the digital (website or app) should be used to invite and incentivise customers visiting stores for that “touch” factor.
  • Be present when luxury shoppers are searching: Use the relevant content mediums and types we have discussed to post engaging experiences for your customers to find.

Thank you and get in touch

Verb is a digital marketing agency that specialises in luxury web design and in providing highly personalised experiences to our clients customers. We help to create our clients’ digital strategy and advise upon the best route to market. Strategy is about choices. We work side-by-side with our clients to shape, rework and revolutionise how and in what manner they interact with their clients. Feel free to comment and discuss and if you’d like to reach me personally, drop me an email on [email protected] and I will get back to you as soon as I can.


Google Think: How Affluent Shoppers Buy Luxury Goods

Deloitte: The New Digital Divide, Retailers, shoppers, and the digital influence factor

Google Think: A look at Luxury Shoppers around the world

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