Luxury retail is all about fabulous customer experience. Pampering a customer as soon as he/she enters the store is something all luxury brands aim for. In the world of luxury retail, brands aspire to ensure that their customer indeed is a king or queen. Be it buying a Louis Vuitton bag, Rolls Royce, Chanel perfume or pair of Louboutins, customers look forward to being treated extremely special throughout their buying journey. This is turning into a challenge for most of the luxury brands. In the era where online commerce is thriving with full force, it’s a challenge to turn the mobile-savvy people into buying from the luxury retail stores. To be competent and at the top of their game, it has become essential for luxury brands to create mesmerizing & bespoke personalized experiences for the customers which isn’t available anywhere else.
Drivers of luxury retail
It is the ease of purchase, super personalized quality service and on-demand support that have become the key drivers that influence the loyalty and spending of a customer. With price being just a number for people who are enthusiastic about luxury products, big labels such as Burberry, Dior, L’oreal, Gillette, Nestle etc. are focusing on enhancing and empowering their customer experiences through artificial intelligence and machine learning. These brands, powered by AI, are able to increase their sales, retain customers as well increase their audience.
Luxury retail analytics – In Action
Burberry is utilizing SAP HANA for offering personalized recommendations both online and in-store. Whenever a recognized customer walks into the store, the salesperson is able to provide personalized buying suggestions to the customer. These suggestions are driven by predictive analytics fueled by purchase history of a customer as well as their activity on social media, combined with the latest fashion trends. The salesperson can suggest a nice shirt to go with the coat they had bought earlier. These valuable insights provided by analytics help increase the sales exponentially as customers walk out of the store buying more stuff than they had anticipated. Indeed, analytics in luxury retail is proving to be a game-changer for big labels.
The deep and meaningful insights provided by AI and ML are aiding the luxury brands to escalate their loyalty base. The sales of luxury retail industry are mostly driven by the millennials and Gen Z. Integrating this fact into their strategy, Dior has taken a leap to strengthen and manage their customer interactions using artificial intelligence. They are harnessing the power of AI chatbots in Facebook messenger to create captivating experience for their customers. Their AI-powered interactive chatbot is known as “Dior Insider”, which is excellently bridging the gap between online and offline purchasing, while increasing the social media conversations.
Analytics: Redefining luxury retail
For luxury brands to accelerate their growth and lower the costs of new customer acquisition, having a strong social media presence is of paramount importance. The space of luxury retail is no longer confined to the A-class strata of the market. Thanks to globalization and proliferation of social media platforms, the luxury retail brands are able to extend their audience reach. Analysis of critical social media data delivers relevant and real-time insights about customer perceptions. Knowing what the customers want enables the brands to be competent and agile, helping them to adapt to the changing customer behavior quickly and restructure their strategy.
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