Are agencies missing on the luxury opportunity?

  1. Luxury has become a growth strategy across industries. High-end offerings have become a strategy for growth in industries ranging from hospitals to banks, real estate, food, hotels, airlines, restaurants, and health and lifestyle activities.
  2. Luxury as service. The most successful modern luxury companies didn’t come from the traditional luxury industry (think Tesla, Apple, Nesspresso, Yoox Net-a-Porter, Apple, Farfetch or Warby Parker). They all supplement their products with great service, which changes customer expectations. Modern luxury consumers consider time, privacy, wellness, achievement and small joys as luxury. This new definition of luxury asks for new go-to market strategies from luxury brands.
  3. Digital maturation. Luxury industry is rapidly maturing when it comes to digital media. The luxury advertising marketplace is expected to expand 3 percent in 2016, nearly doubling from the 1.9 percent it grew in 2015. USA accounts for 82 percent of luxury advertising expansion. With these increased digital media investment, luxury and fashion companies need guidance in allocating their budgets in the right way and in developing a sustainable customer acquisition and retention strategy.
  4. Luxury as a loss leader. While revenue in luxury is perceived as lower, the opportunity for prominence and prestige is significant. Getting into luxury and fashion market is a way to attract mass and premium brands to command higher revenue from these brands.
  5. Data and analytics. Luxury companies are rife with inefficiencies. They are siloed, with isolated customer databases and poor data and analytic capabilities. The outcome is lack of consistency in serving their customers. Digital, social and in-store analytics are the big growth areas.
  6. CRM, CEM and loyalty programs. Luxury businesses count on repeat customers for growth, yet they massively underinvest in customer service and in the post-purchase engagement.
  7. Evolution of e-commerce. E-commerce used to be exiled to IT departments. Today, digital commerce increasingly gets integrated into luxury and fashion companies’ core business strategy and marketing.

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Brand Executive. Author of “The Business of Aspiration.” Doctor of Sociology. Writer of “Sociology of Business.” Forbes most influential CMO.

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Ana Andjelic

Ana Andjelic

Brand Executive. Author of “The Business of Aspiration.” Doctor of Sociology. Writer of “Sociology of Business.” Forbes most influential CMO.