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An Actionable Pathway to Successful Customer Journey for Luxury Brands
The dynamics within customer experience have been changing rapidly since the last few years. The global transformations have impacted the way we live, work, and shop including the effect on behaviors, hindering industries while still encouraging growth in others. Increasingly, the luxury customer experience is being reshaped by the digitization of the customer's entire shopping journey.
When it comes to luxury brands, delivering an impeccable customer experience is one of the most important things to consider. The future growth and success of a brand depend on reshaping the customer experience by offering more personalized and customized products and services.
The Need of Customer Experience for Luxury Businesses
At present, the ability to accommodate evolving customer tastes is pivotal to sustain market share. This could be a strategic imperative to identify growth opportunities and strengthen competitive advantages. Although most brands know this, many fail to recognize that adding to the long list of initiatives is not the best way to make it happen. There is a continual need for brands to stay updated with customer expectations.
Creating and scaling an excellent luxury customer experience is one of the critical ingredients of a successful business. But what does it mean to develop and scale customer experience? And how can a brand implement it successfully?
Scaling is to create and have ownership over the customer experiences for any particular type or group of customers. When appropriately implemented, scaling and balancing customer experience for your brand can save you time and effort while redefining customer satisfaction.
Did you know that customers face similar obstacles to online and in-store shopping? PWC
All luxury brands are rushing forward to advance their customer experience as they have realized it is the single most critical factor for business success. Using key steps, business leaders can significantly improve experiences for customers and thrive in these challenging times.
Reshaping Luxury Customer Experience
Social impact with regards to delivering luxury customer experience is soaring high, and brands are expected to showcase a true commitment to diversity, inclusion, and sustainability. The younger generations are more conscious of the social and environmental impact of their buying decisions. They are more likely to go for a brand that reflects their values. Hence, shaping the customer experience with respect to user interest has become more important than ever.
Accompanied by the latest technologies like artificial intelligence, the internet of things, big data, and machine learning, the modern luxury segment is transforming. It is triggering changes while reshaping the way that consumers engage with the brand. Thus, brands are expected to embrace digitization which is a crucial source of reshaping the luxury customer experience. Because tomorrow's customers will want to live the experience – not just spend on luxury products or services.
Tips to Elevate Luxury Customer Experience
To keep up with the elite consumers’ growing affinity, brands must understand their digital opportunity and the foundational aspects of digital go-to-market success.
1. Leverage Personalization to Delight Customers
For the luxury industry, personalization has always been the top priority for creating customer loyalty. Initially, personalization through store outlets and service facilities was some of the ways. But the explosion of the digital phenomenon over the past few years has created empowered customers. They now weave both their digital and physical worlds so intricately that they can’t realize why brands aren’t doing the same.
Customer desires continually evolve in numerous ways, requiring brands to find unique and creative ways to stay competitive with their products or service offerings. Business leaders can utilize customization and personalization options to create new offerings for current customers and ultimately persuade new customers.
Consider Steinway & Sons, as an example. The German American piano company Steinway & Sons, is a top choice for 98% of concert pianists because of its exceptional quality. To improve their digital customer experience, Steinway & Sons reinvented their CX strategies by aligning their internal operations and technology road mapping. This helped them to meet the expectations of their digitally savvy clientele.
The crucial competitive differentiator in the luxury segment is to cater to the individual. This is what defines luxury, and it is a challenge for any brand looking forward to providing a luxury customer experience. The keys to serving an impeccable experience are customer segmentation, research, observation, and communication.
2. Gear Up for the Next Wave of Luxury E-Commerce
According to a report by Statista, e-commerce will make up around 25% of the global luxury market by 2025. Over the past years, the luxury market has undergone several transformations while expanding the customer base further than we could have imagined.
But before the recent global evolution, luxury market pioneers had won over a generation of customers obsessed with exclusivity and newness. Success usually came from immersive retail experiences and relentless streams of novelty for many. But that has changed dramatically by the digital age that has allowed people to engage with their beloved brands whenever they want.
After decades of innovation and significant changes, the luxury market is now brimming with the second wave of growing brands who have already made their e-commerce channels a bigger priority. Embracing e-commerce can bring a crucial revenue source and an opportunity to receive an entirely new set of customers.
3. Embrace Data Analytics to Win Big
Data analytics is a tool to explore customer data to understand their preferences, choices, interests, and behaviors. For luxury brands, as it is a matter of selling quality to the right audience, reflecting the luxury items directly towards the right audience with the help of data analytics will not just help them understand the customer and meet their needs, but also result in a shorter sales cycle.
By embedding data analytics, a luxury brand can connect on a responsive activity-based level with its registered client base. Understanding the purchase behaviors and customer lifestyle is not possible with manual tasking for the elite client base. Thus, from the data insights, luxury brands can shape their portfolios in a more customized way, and showcase it to the target clientele for better response. Hence, leveraging big data analytics will help a luxury brand evolve and scale their CX journey faster.
Moreover, data insights will, no doubt, transform the customer experience journey, but also help the brand to explore new customer engagement opportunities to invest in.
4. Building a Community through Immersive Storytelling to Create a Long-term Momentum
This was amplified during the pandemic where luxury brands reached out to their customers and tried to create a community. For example, a Spanish luxury fashion house, Loewe, launched a special project called 'LOEWE EN CASA' (LOEWE at home), which is a series of Instagram live events and workshops to find that work-from-home harmony.
US-based contemporary fine art dealer, David Zwirner, incorporated automation and personalization to reshape the customer journey. The art gallery made it possible to continue its business model even in the global pandemic with virtual viewing rooms consisting of some of the world’s most famous artists.
It's Time to Embrace the Rapid Change to Unlock Business Value
With all the changes afoot happening so fast and high competition in the industry, luxury brands are running out of time to develop winning strategies for luxury customer experience. The idea is to innovate and adapt while still creating relentless advances for customers to discover.
However, amid a crisis, several new opportunities may arise. For a deeper dive into what it means to be a future-fit luxury brand leader, you need to consult the market leaders. To know more, Explore Icreon’s Digital Ecommerce and Consulting Services.