Mont Blanc Facebook Page | Source: Facebook
Online sales of luxury goods may climb 20 percent a year by 2015 as producers build networks of potential customers on social media websites such as Facebook.com, according to a study published today.
Revenue from fashion, jewelry and other luxury products is likely to reach 11 billion euros ($15 billion) in four years, the report from Italian luxury trade group Altagamma shows.
“The explosion of social media and the increasing investments in the online channel by luxury companies has reinforced and enlarged the community of those who explore, comment upon and eventually purchase luxury goods,” Milan-based Altagamma said in a statement.
Luxury companies are more than doubling their “friends”on Facebook annually in recognition of the link between online and offline purchases, according to the report. At least half of consumers in Europe, the U.S. and China form an opinion or seek information online before buying in a store, while most online luxury sales are preceded by a boutique visit, Altagamma said.
Burberry Group Plc (BRBY), the U.K.’s largest luxury goods maker, gets “the most reach and most response” from digital initiatives compared with other media, Burberry Chief Financial Officer Stacey Cartwright told analysts on July 13.
To promote the Burberry Body fragrance, which hit shelves this month, the London-based company offered exclusive samples to its nearly 7 million Facebook fans. It received more than 225,000 requests in little more than a week.
The Internet plays a key role in increasing the hype around luxury brands and their products, Altagamma said.
Fashion Blogs
Louis Vuitton Facebook Page | Source: Facebook
(Forbes)
“Just because a brand has big marketing prowess or is known globally doesn’t necessarily mean it’s active or even gets social media–namely Facebook, that is.”
“Just because a brand has big marketing prowess or is known globally doesn’t necessarily mean it’s active or even gets social media–namely Facebook, that is.”
The web’s influence on perceptions of luxury goods is strongest in China, where fashion blogs are the source of opinion for 58 percent of consumers, compared with 27 percent of their counterparts in Europe and the U.S., the report said.
The Asian country also has a higher penetration of online purchasing. Seventy-eight percent of Chinese buy luxury goods online, compared with 56 percent of Europeans and 46 percent of Americans, “mainly because they wish to avoid interactions with sales personnel or their insistence,” Altagamma said.
The study included surveys of 187 companies with total revenue of 60 billion euros ($82.1 billion), interviews with 1,500 consumers and analysis of 450 websites in seven countries. ( By BloomBerg )
A new six-country survey from DDB reveals that Facebook users who like a brand's page on the social networking site use its products regularly or occasionally and, after following the brand on Facebook, more than a third of the respondents "want to buy this brand's product more."
Brand page fans on Facebook also feel comfortable recommending the brand to friends, with 49 percent of the respondents saying they would "certainly" do so and 43 percent saying they "probably" would. Collectively, that's a whopping 92 percent who qualify as brand advocates -- a figure that staggered survey leader Catherine Lautier.
"I was expecting [brand page likers to be] a lot more benefits orientated versus, 'I'm joining because I actively want to recommend it to friends,'" said Lautier, director of business intelligence at DDB France in Paris. "I thought it would be a lot more passive than that."
Brand page fans on Facebook also feel comfortable recommending the brand to friends, with 49 percent of the respondents saying they would "certainly" do so and 43 percent saying they "probably" would. Collectively, that's a whopping 92 percent who qualify as brand advocates -- a figure that staggered survey leader Catherine Lautier.
"I was expecting [brand page likers to be] a lot more benefits orientated versus, 'I'm joining because I actively want to recommend it to friends,'" said Lautier, director of business intelligence at DDB France in Paris. "I thought it would be a lot more passive than that."
The survey sample skewed female (55 percent) and had an average age of 31, according to DDB. Most of the respondents are fairly active on Facebook, with 76 percent visiting the site either once or several times a day. On average, they follow nine brands, the bulk of which (55 percent) are in the media/entertainment sector. The next biggest sector was causes, at 51 percent, followed by fashion/luxury goods, at 46 percent.
The survey found that ads are the primary driver to brand pages, followed by invitations from friends and Web searches (see graphic). And once there, fans expect more than downloadable coupons. Rather, they want to feel more like a VIP who can access exclusive content, information about new products and yes, promotional offers, before the general public can, DDB discovered.When ranking the most important reasons why they follow brands on Facebook, respondents cited promotional benefits first, followed by liking the brand, wanting to know about new products, gaining access to exclusive information and being able to provide opinions about the brand. So, to keep fans on Facebook, brands should consider them loyal customers and apply the principles of classic customer relationship marketing, Lautier said.
Even brand advocates, such as those who participated in the survey, will reject a dull or irrelevant page. Thirty-six percent of the respondents said they've unsubscribed from a brand page. Why? Because they lost interest in the brand, the page's content came too frequently and it wasn't particularly interesting, the survey found. ( By A.W)
Luxury News / Golden Choice by Lux Creative International
