NEWS10 June 2015

Luxury brands must tap into tech changes

News

US — Global luxury brands must take advantage of evolving technological and consumer demands to remain competitive as the sector will encounter dramatic changes over the coming decade, according to a Deloitte report.

Industry executives pointed to damage to reputations from social media as one of the highest risks and that there was legitimate concern about diluting a brand’s exclusivity in the more accessible online world, in the second annual Global Powers of Luxury Goods report issued by Deloitte Touche Tohmatsu Limited (DTTL).

Other findings included the need to reach the millennial shopper by understanding their buying habits – 58% of millennials go online to search for information on luxury items and 31% use social media for gathering information around discounts and promotions, compared with 10% for older luxury consumers.

Results from Deloitte’s survey of more than 1,000 high-income earners across Europe found that while traditional marketing channels such as magazines and store browsing continue to be relevant for consumers gathering information on new luxury brands, 45% of participants said that they search online for information.

According to the report, the world’s 100 largest luxury goods companies generated sales of $214.2 billion through the end of the last fiscal year despite currency headwinds and intense technological disruption.

Patrizia Arienti, DTTL EMEA fashion and luxury leader, said: “Several key aspects of the luxury sector will be unrecognisable in the next few years. The travelling luxury consumer will change the concept of national boundaries; millennial consumers will represent a significant percentage of sales volume in luxury; and the competitive forces driven by technology will continue to disrupt at a faster pace.

“As such, global luxury brands must overcome significant challenges in order to maximise engagement with their digitally-savvy, time-sensitive and socially aware consumers or risk being left behind.”

Separately, the Market Research Society is holding its Luxury Research 2015, Essential insights into affluent customers and luxury trends on Wednesday 16th September in London.

@RESEARCH LIVE

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