Le luxe est-il adapté au commerce électronique? (document en anglais)

Is luxury suitable for e-retailing?

Luxury is a very specific business. In fact, it is characterized by “global recognition, exclusivity, artisan heritage and reputed for quality, immaculate service and premium price.” (Jackson and Shaw, 2009).

Nevertheless, Internet is currently the first medium, 93% (journaldunet.com) of the population is daily using it, and therefore businesses cannot get rid of it. However, is luxury compatible with e-retailing?

Initially milliner, Coco Chanel is the reference for luxury, she pointed, “luxury is a necessity that begins when necessity ends”.

Luxury consumers’ expectations towards brands and products are higher than any other business. Moreover, “Luxury is related to pleasure and indulgence of senses through objects or experiences that are more ostentatious than necessary. It may be expressed through objects that are rare, original, expensive, and of the best quality. We may generally agree that luxury is synonymous with pure pleasure and indulgence.” (Okonkwo, 2010). Thus, customers are not only looking for fine products but maybe mainly for the linked services.

Luxury brands are expected to deliver emotional and experiential satisfactions to the consumer - like timelessness, sophistication, distinction and innovation.

But the brand image is the main appeal to the customers. This is why old luxury businesses are repositioning in the market using a strong fashion identity. “The added dimension of symbolism, which is communicated through the ownership of specific brands and products, enhances identity. It enables an individual greater self-expression and group association (Jackson and Shaw, 2006).

“In past society, nobles and royals used ostentatious consumption to stamp their superiority and maintain their distance from the less privileged.” (Okonkwo, 2010). Societies have changed but people not people vision. “The deep seated need of man is to show his distinction, to be admired, recognized, appreciated and respected, through differentiating himself, in most cases with his possessions.” (Okonkwo, 2010).

Luxury has different types of customers. In fact, according to Ernst and Young, at the end of 2000 there were 7,2 million consumers with an average of $3,8 million in financial assets, together they owned $27 trillion in liquidity. However, emerging economies like Russia, China, India and Latin America is a main source of revenue for luxury brands. In those countries “the ownership of luxury products is relatively low and directly linked to the conspicuous use and of a higher status into society (Jackson and Shaw, 2006).

From its creation, Internet has become a mass media. This is why it does not seem compatible with luxury as its main features are on contradiction because skipping exclusivity. “Most presumptions range from the credence that the Internet is a channel of retail for price-discounted mass products and damaged goods, or that online advertising over-exposes a brand’s image and damages its equity, or yet again that luxury clients won’t bother with making online purchases but would always prefer the sumptuous surroundings of the physical stores and real human contact with the products.” (Okonkwo, 2010).

However, the resistance of luxury brands towards e-retailing and e-business is no longer solid. In fact, the recession has led to mandatory investment in e-retail and social web marketing strategies as sources of sustainability.

Moreover, consumers’ expectations are as well changing. According to Peter Drucker, Luxury clients will demand emergence of a new world, they will demand more meaning from luxury brands that transcend products, services and brand names.

Moreover, luxury remain centred on the customer and has to adapt its products to people’s daily lives. “There is a real art in defining the relevance of a luxury brand while keeping its heritage alive: it is a matter of catering to existing clients while attracting new customers, which involves an on-going assessment of the appropriate balance between a product’s form

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