Received wisdom may say that online shopping is driven by shoppers looking for cheap prices. But new research seems to throw that into doubt.
A study by consultants McKinsey and Italian luxury goods association Altagamma, and reported in the Financial Times suggests that worldwide online sales of luxury goods reached €6.2bn in 2011, and grew three times faster than the total luxury goods market, which is put at €190bn. The study also found that consumers browsed the internet for price and research information on luxury goods, leading to around 15% of luxury sales, worth some €25bn, that were directly generated over the internet.
The study also estimates that up to 20% of in-store sales, worth some €34bn, could be influenced by the online experience.
Armando Branchini, executive director of Altagamma, told the FT that the impact of the internet on luxury sales meant this was “already a bigger market than China.”
The study, says Mark Haviland, managing director of Rakuten Linkshare UK, “blows out of the water,” the idea that online shopping is for bargain hunters.
Haviland said the findings “confirmed what we expected: “that digital will play a massive part in the growth of the luxury sector.” He added: “This supports evidence that we are seeing from our own network – that luxury is booming online and our publishers are driving large volumes for brands.
“As the report reveals, luxury consumers visit more than four sites to help them make the right choice, so ensuring your brand appears on a number of sites is crucial. The consumer buying cycle is complex, and brands must be in the right place at the right time to prompt a consumer to make a purchase and tablets of course play a massive role here too. Revealed also is evidence that well-placed offers and loyalty deals are in demand.
“Combine this approach with good relationships with trusted publishers, and brands can reach the volumes they desire, without infringing on brand equity. The idea that online shopping is for bargain-hunters has been blown out of the water now. Luxury should no longer fear digital, and many have clearly already embraced this.”