Luxury and Web 2.0

My case for promoting luxury on the web continues. Here's an interesting article from Brandchannel, that talks about how luxury brands can catch up and cash into Web 2.0 (for those who came in late, Web 2.0 refers to second generation internet applications like blogs, wikis, podcasts, social networking platforms like Facebook, etc, denoting a clear shift from using the internet for information to using it to interact and collaborate).

"I'm sympathetic to their reasons for hesitating," says Julia Rubinic, group director for the retail sector at the digital marketing agency Organic. "Luxury brands are experts at controlling their image and their brand equity. They have a real fear of losing control. It's like in the film Pretty Woman when Julia Roberts walks into the store on Rodeo Drive dressed like a prostitute—you can't control who comes to an online store or talks about your brand on a blog or customer forum."

Yet talk of control still implies a top-down, we-know-best-and-we-won't-listen-to-you attitude. But Web 2.0 is changing the dynamics of customer-company interactions. In the near future, a brand's equity may not rely on how well it is controlled, but how well it is shared.

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"Before Web 2.0 you couldn't put an experience online that represented their brand," agrees Joe Chung, CEO of e-commerce software provider Allurent. "Now it is time to take advantage, but take advantage of the whole range of technologies and experience out there, including the relationships and networking aspects. Like it or not, all brands are losing control. There's been a shift in the communication model. Around 2.5% of people on the Internet are talking to the remaining 97.5%. That sounds like a low percentage, but it is actually pretty good. Everyone is influenced by blogs."

Chung suggests that luxury brands have a great opportunity to take some initiative and build authentic communities around their brands. He imagines how a customer who has just bought a handbag in store is invited to join an online club, giving them privileges, invitations to previews, private events, and interactions with like-minded handbag buyers. Such exclusive offerings are a first step for luxury brands into the world of Web 2.0.

While many people will argue against Luxury and Web 2.0 as downgrading an exclusive brand, I personally think it's a great marketing and communications tool. A lot of HNWIs are internet savvy, read blogs and even shop online, so Web 2.0 is another fabulous means of helping them connect with their favourite brands. However, marketers need to ensure that their promise and the customer's experience is compatible and yes, oh-so-exclusive.

Image courtesy: Getty Images

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UPDATE

Was browsing more on fashion and Web 2.0 and read about Net-a-Porter's superbly successful Roland Mouret virtual showing in mid-July at The Business of Fashion. In the first four days alone, more than $500,000 worth of pre-orders were placed and 250,000 videos were viewed in 22 countries.

Think about it: it's a brilliant model for online luxury retailing. Customers get to order in advance, Mouret gets a global platform for his new collection and Net-A-Porter knows exactly what quantities to order for its customers and gets a view of which items will be its bestsellers.

So why aren't luxury companies joining the party? The Busines of Fashion says it's a combination of risk aversion, conservatism and a snobbish attitude towards selling luxury online. Seriously, they're missing out on one giant opportunity. Until a brand can afford to open shop in Dubai, Shanghai and India, what better way to reach out to customers in faraway lands than this?