At today’s Coresight Research/Bloomberg Intelligence Zoom event, industry experts shared their views on retailing’s new normal. Of particular interest, Marie Driscoll, Coresight’s expert on luxury and fashion, shared some optimistic observations. Although the luxury segment has been particularly slow in joining the digital era, brands and retailers are finally acknowledging that “without a digital component, they’re toast! More luxury brands are making some products available online. It doesn’t have to be their total collection; some is a good start.”
Driscoll explained that luxury growth in China in recent years was driven by more people entering the middle and upper classes. Today, the young luxury customer in China uses digital to discover new brands so, without a strong digital presence, luxury brands risk being ignored. The other key factor in luxury is international travel which has been decimated during the pandemic.
According to recent data, 30 percent of luxury spending by Americans is done on international trips. The good news here is that hopefully, these dollars will now be spent in the U.S. rather than abroad. While Driscoll projects international travel will bounce back by the end of 2021, luxury retailers with aggressive marketing campaigns in the States have plenty of time to win over this customer.
“Zoom appointments can work,” she maintains. “The COVID-19 crisis has accelerated the adoption of telling brand stories via video. I believe that during this pandemic, customers have had time for self-examination and reflection. They are reexamining their needs and looking for brands that represent their values. They’re also reassured by products with heritage elements. This is good news for heritage brands with strong values that get their messages out.”
A closing note: in a live poll, 91 percent of seminar attendees believed that a strong digital presence is essential to success in today’s new normal.