LUXURY BRANDS

CRM TECHNOLOGY
FRAMEWORK
Group 7
Amenla Sonal Apoorva Pragati Karan Vikram
LUXURY RETAIL
There is no clear definition of luxury with a
simple dictionary definition being not
essential.
Luxury sales have remained resilient, as have
sales of value brands. It is
the mid-market which has
seen a dramatic decline in
sales.(The Well curve)

CRM CHALLENGES IN LUXURY RETAIL
Problem for brick and mortar retailer is to identify
potential consumer
Difficult to assemble 360 degree view of consumer
High expectations of consumers from in-store service
Need for hands-on sales approach: high-service
interaction, personalised communication, custom
fitting
With the rise of east (By 2015, Chinese consumers will
account for more than 20% of the global luxury
market), luxury sector will call for increased
segmentation
CURRENT SITUATION
Luxury retailers adopting
multichannel approach
45% retailers register customers
via sales associates at stores
41% at POS
41% online
Top objectives for loyalty programs: Customer
lifetime Value and Competitive advantage
CASE 1: PRADA E-TAGS
The Italian clothier put RFID
tags on every item in its NYstore.
E-tag chips send wireless signals
with product name, directions for use
Monitor every aspect of consumer movement
with electronic sensors
As customer heads to fitting room, sales staff
monitor their routes and provide image of
garment, details of cut etc


CASE 2: SEPHORA MOBILE APP
Launched Mobile Voice Application that
allows customers to access reviews at hosted
mobile websites
The app also provides mobile-specific
analytics to suppliers &retailers
Within days of launch, over
100,000 reviews were posted
with an avg rating of 4 on 5
CASE 3: BODY SHOP ON IPHONE
Body Shop has created first
prototype of mobile CRM to
allow consumers to use their
iPhone in place of loyalty cards
App also includes wish lists
and sharing product info
360-degree CRM (Transaction, analytics,
conversation)
FACEBOOK FACTS
500 million hours are spent on
Facebook in the UK every month.
In Dec7.5% of visits to all websites
in Canada came from the social network.
The average time a user spends on Facebook per day is 22
minutes.
For every one Facebook fan your company gets you can
expect a return of 20 extra vistas on average over a 12 month
period.
Facebook's average daily traffic in the US is a whopping 40
millions hits.
One in every six page views in the US is on a Facebook page.
FB FOR LUXURY BRANDS
How can retailers optimize their Facebook
presence?
Should they focus on the product?
Should FB be a customer service channel?
How far should they engage?
Can Facebook be thought of as a sales tool?
Can FB help with fostering brand loyalty?
Should FB be used to entertain?
FOCUS ON ENGAGEMENT, NOT SALES
Although some
retailers, such as
Express and ASOS, are
opening up stores on
Facebook, most
fashion retailers agree
the time is not yet ripe
for F-commerce
While iframes is
certainly making
ecommerce integration
on Facebook easier
and more cost-
effective, Facebook is
still best employed as a
CRM tool
In the same way that MSN and Yahoo and then
search became the most powerful shopping
engines in the world, social media will be the next
big wave. But were not there yet. Right now
[retailers] need to focus on engagement and
content strategy.
--Maureen Mullen, chief researcher
at luxury think tank L2
DEVELOP PRODUCT-CENTRIC
CONTENT STRATEGY
Fans really want to hear
more about product and want
to interact with the brand
itself, Mullen says.
Retailers should provide
information and access to
products beyond what fans
would find on their ecommerce
sites or in their stores.
They should develop visually
attractive, entertaining content
that enables fans to learn more
about the design and
development of a product, the
designer who created it and
others behind-the-scenes
snapshots.
Ralph Lauren-owned retailer Club Monacos Facebook
Page is designed to give fans an inside look at the
companys brand and culture while simultaneously
becoming a part of it what Ann Watson, Club
Monacos VP of marketing and communications, calls
the inside out approach.
OTHER EXAMPLES
New York-based luxury retailer
Bergdorf Goodmans Facebook Page
creates a range of content around a
certain theme or trend based on
whats happening at its store.
A recent theme centered around its
Jean Sequence event, which is
extended across content and
imagery on the retailers Facebook
Page, blog, website, and more.
Like the store itself, we want our
page to be a destination where
people enjoy spending their time
and looking around, a spokesperson
says.
Online luxury retailer Net-a-Porter
has a similar approach to sales. The
primary focus is engaging and
entertaining our fans if in turn this
results in sales, this is a bonus.
Its about providing interesting and compelling
information as a fashion leader [and] having a
conversation with people; sales is just a by-
product.
ALLOW FOR TWO-WAY DIALOGUE
Luxury brands are very protective of their
brands and images, traditionally
maintaining an armed distance from their
consumers and creating a sense of scarcity
around their product
Retailers Tory Burch, Diane von
Furstenberg and Bergdorf Goodman allow
fans to post not only in the comments, but
directly on the Page.
Whilst this does create some moderation
work, it also underlines the value each
company places on its customers.




Flash sales site Gilt practices
two-way engagement on its
Facebook Page via a Support
tab where fans can ask questions
and deposit feedback. Closely
monitored by Gilts customer
service team, so users can expect
to see timely and accurate
responses to their queries
BUILD YOUR FAN BASE
The brand ran through its initial 5,000
sample allotment within 24 hours, and
because it was generating so many Likes, the
team decided to give away 25,000 samples,
which it ran through in three days.
Not only was the giveaway successful in
terms of press mentions and Facebook Likes
the initiative increased total Page Likes by
40% it also turned out to be a valuable
feedback tool for the company.
Approximately 5,000 people answered
questions on the scent in a followup survey.
Sampling as a concept is old school, but
with a traditional sampling you dont get to
hear what people think. The ability to collect
feedback on your product is an important
advantage to Facebook as a marketing
platform, says Erika Bearman, Oscar de la
Rentas director of communications.
Oscar de la Renta employed a
cross-channel strategy to build buzz
around its first fragrance launch in
10 years.
The company leveraged its existing
PR assets as well as Facebook ads to
drive consumers to sign up for free
samples on its Facebook Page.
LET YOUR STRATEGY EVOLVE
A well-developed, engaging
content strategy, coupled
with on-site advertising and
multi-channel campaigns to
drive Likes, is the best way to
ensure that retailers are
prepared for the advent of
social media-driven
commerce.
Its also important to keep
content fresh, and to evolve
ones Facebook strategy over
time.
Keep experimenting to find
the right strategy [and] alter
your communication style on
Facebook [whilst] staying true
to your brand.
You dont need to be quirky or funny to be successful in
social media, just stick with your brand values and
create an honest and open conversation with your fans.
They will tell you what you need to be successful.
-- Jason John, senior director,
marketing at Gilt Groupe
VIDEOS
http://www.youtube.com/watch?v=TwqHKtbY
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