Luxury brands have identified a lucrative market in the cross-border category, which has emerged as the fastest-growing segment, according to a report by e-commerce specialist eShopWorld (ESW). The study surveyed almost 15,000 consumers from various countries and revealed that the demand for luxury goods is particularly strong in China, UAE, South Korea, and India. In fact, the report found that over 70% of Millennials, GenX, and Baby Boomers in China and South Korea prefer to shop for luxury items online. This presents a significant opportunity for European and American luxury brands looking to target these emerging markets.
While online shopping for luxury products is gaining popularity, there is still a demand for the in-store experience. The report highlighted that 42% of luxury shoppers prefer to visit physical stores, as it allows them to touch and try on products. However, even online shoppers expect a high level of luxury experience. The study found that 77% of respondents expect exceptional personalized customer service when purchasing luxury products online, and 75% believe that brands and retailers should focus more on improving the premium levels of customer service. Additionally, 69% of consumers stated that they are more inclined to buy luxury goods online if the online experience matches the level of service received in-store.
This poses a challenge for luxury brands and retailers to create a seamless and luxurious online shopping experience. Many struggle with aspects such as delivery, returns, online imagery, and other customer services. To succeed in the digital landscape, luxury brands need to prioritize recreating the high-touch, hyper-personalized experience that customers enjoy in-store. This includes providing tracked and personalized delivery, free returns, luxury packaging, and premium courier services. Immersive online experiences play a crucial role in bridging the gap between online and in-store shopping.
The COVID-19 pandemic has accelerated the shift towards digital strategies in the luxury market. It is predicted that luxury e-sales will increase to 30% in 2021, compared to 22% in 2020, largely driven by Millennial and Gen Z shoppers. The growing digitally native middle-class outside of traditional luxury markets demands high-quality luxury products. To capture this demand, luxury brands should embrace omnichannel strategies that meet the expectations of modern consumers while maintaining the core values of the luxury experience. By adapting to the changing landscape and providing exceptional customer service, luxury brands can thrive and secure the loyalty of the next generation of luxury shoppers.
Useful links:
1. Luxury Goods Buying Linked to Digital Experience in 4 Key Markets
2. Emerging markets drive luxury revival, online boom
