M-Retailing

Luxury e-commerce just about taking the strain of online consumer demand, says Catchpoint

To understand how luxury brands are using the Internet to grow their markets, digital experience monitoring company Catchpoint has analysed how their ecommerce sites perform in two of the major luxury consumer goods markets – the USA and China. The findings suggest that some luxury retailer’s ecommerce strategies may be faltering through web performance problems.

Catchpoint analysed ecommerce site performance of 25 luxury brands in Q4 2016. The top five performers were Patek Philipe, Porsche, Rolex, Dior, and Chanel. Each site loaded in 2.3 seconds or less. In Q4, the average median webpage load time for desktop luxury sites was 3.65 seconds and 3.52 seconds for mobile luxury sites.

Fast, convenient online interactions not only help drive more conversions in luxury goods sales but they can also positively influence the decision to shop in-store. According to a Google study of luxury shoppers in nine countries, while only 7 to 19 percent of purchases are made online, more than 90 percent of luxury shoppers use the web to research products before purchasing.  Furthermore, a recent study commissioned by Catchpoint found that nearly a half (47 percent) of UK online shoppers would be less likely to visit a retailer’s brick-and-mortar store if they have a negative experience on the retailer’s website or app.

The root cause of performance issues lies – ironically – in how luxury brands are trying to compete with more luxurious, richer personalised digital experiences for high value customers. Brands need to seduce potential buyers, provide them with the right emotions, the sense of belonging to that select group of people. They don’t always have the manpower to produce more so they want to increase their margins rather than the volume.

 

So, investing heavily in digital technologies to gain a deeper understanding and relationship with very individualistic richer customers is a natural step but it comes often with a performance penalty because of how sites have to use an array of third party applications and plug-ins. These offer intelligent search, predictive analytics, live chat, social media and multi-media that customise the experience but can mean that luxury sites struggle, especially at peak periods. When third party applications slow down, it can degrade performance for an entire site, or group of sites relying on it.

For every day brands performance issues are serious matters but for a premium brand, founded on flawless user experience on all touchpoints, poor performance is totally unacceptable.

As luxury brands globalise, these problems with external services are amplified especially when they use the Internet to serve new fast growing luxury consumer markets such as China, according to Catchpoint’s analysis.

Louis Vuitton and Rolex had the best performing luxury sites in China. Many luxury brand sites took significantly longer to load for Chinese customers. For example, while the BMW site took over 2 seconds to load for US customers, it took close to 8 seconds in China.

Catchpoint analysed the reasons for poor digital experience in China. Poor performing sites had a considerable number of third-party contents especially from Google and Facebook which are known to be blocked in China. Other factors included sites requesting objects which were not present in the server hence returning 404 errors while best performing sites had no such behavior.

Luxury brands seeking greater international sales in these new regions need to do more to manage the complexity of their sites and infrastructure. New performance management approaches, which allow IT teams to analyse a growing range of performance-impacting variables and accurately pinpoint the root cause of performance issues, will be key for luxury retailers, enabling them to achieve not just sufficient or satisfactory performance, but a consistently excellent digital experience.

Robert Castley, Senior Performance Engineer, Catchpoint said: “Luxury brands need to excel in both personalisation and performance at the stratospherically high levels because like the luxury bricks and mortar retail experience, digital luxury must be like nothing else. But, that wow factor is extremely challenging to achieve and lies down negotiating  a dangerously narrow margin between delivering the very best ever digital experience and sudden crashes in performance that are seriously damaging to the brand.

Leading luxury brands will need to ensure strong web performance around the globe, helping them tap growing ecommerce markets like China and India. Unfortunately, these regions are the same ones that present unique web performance challenges for multinational retailers, including the China firewall which often inadvertently slows web content from foreign regions, and limited internet infrastructure in more rural areas.”