• E-Commerce SEO

The Future of Customer Engagement in Luxury E-commerce

  • Ekta Patel
  • 6 min read
The Future of Customer Engagement in Luxury E-commerce

Intro

The luxury industry has its nature of being exclusive and highly human-touched, which is in high contrast with the e-commerce nature of mass-oriented, accessible, and automated. The pandemic wreaked havoc on this ideology. There was minimal engagement and lesser spending on luxurious items for two years. Many reported losses during this period, causing them to reconsider their robust stance on e-commerce. Many turned to e-commerce website development companies to redefine what e-commerce would mean to the luxury sector.** **According to Statistica, by 2025, e-commerce will account for approximately 25% of the global luxury market. The current article elucidates how luxury brands can use e-commerce to increase customer engagement without compromising their values.

The internet has given unprecedented power to customers. While every business has adapted to e-commerce, the luxury sector still hesitates to accept this change. Covid-19 has had the most impact on the luxury sector as physical stores were inaccessible for most of the year, and customers did not wish to spend on such luxuries. This was the wake-up call for luxury fashion firms to increase their online customer engagement to survive. The global luxury online market has since increased its market share. The wealthiest customers of today purchase online with a new set of expectations, such as giving priority to engaging, effective, and personalized experiences — as well as those that provide an emotional connection to their favourite brands. Hence, understanding customer engagement becomes an integral part of a business now.

Build consumer trust to futureproof your brand

Luxury brands have always been careful with whom they are associated. Their goodwill depends a lot on their endorsements and ambassadors. That’s why they are a tight-knit group where every individual is evaluated before being approved as their customer. But the future is different. The future of e-commerce is all about personalization, trust, and authenticity. To increase customer engagement, brands should forfeit such tight control over their brand narrative and partner with people who can authentically connect to the different communities. Content that is quick, innovative, and informal generally fits better and feels more genuine. Brands have the power to influence and advance cultures with their decisions. Customers now want to be seen and heard as individuals with their styles and preferences. As personalization becomes more prevalent, brands must push themselves to pick the right situations and tailor their messages to the target consumers. It must be far more human-like from the start.

Develop two-way communication

The future of luxury engagement will depend on customization and how much a brand is willing to listen to its customers. They will have to learn to respond, adapt, and adjust to being a part of a community and not just rely on old methods of customers coming to them. Social media would have to play an essential tool in customer engagement. Brands would have to stop disregarding copywriters and community managers. The comment section of a post has the most valuable feedback, and brands can use this to leverage their engagement. Luxury e-commerce would change the way customers interact with brands. There would be authentic interactions revolving around the products, including debates, dialogues, and feedback.

Diversify content for different channels

Social media is where everyone is interacting now. It is the place for listening and putting out content. The internet has given us more and more ways to connect and interact with brands. Luxury fashion firms are slowly but surely adapting and joining many of these platforms. For good customer engagement, these retailers should understand how to connect in a community. Adapting different strategies for different channels and building the same one-on-one connection with customers online should be their primary focus.

They can not utilize the same content across all platforms and hope for increased engagement.

The introduction of Web3 has given more opportunities for brands to connect and bring value. Right now, Web2 is a naturally transactional space. Web3 has set new standards with resource sharing, flat hierarchies, and more specialized interests. Web2 is an open source where everyone can join, and there is a lack of exclusivity. With the growing popularity of platforms like BeReal and Discord, secret accounts, and closed groups, there is a noticeable growth of more private areas and closer-knit communities. Luxury e-commerce can use this technology to its advantage and bring back the intimacy and exclusivity that has been somewhat washed down.

Prioritize personalization to deliver a luxury experience

E-commerce is the epitome of personalization. Every brand wants to offer the best personalization to its customers in the hopes of retaining them. The internet has democratized access to products, choices, and information. Luxury fashion firms used to cater to specific customers with little personalization as they believed in exclusivity.

With luxury e-commerce, multiple brands are coming together and have understood that luxury brands must respect individualism. Luxury e-commerce can truly curate items for people across various aesthetics, price points, and events. They are leveraging data science to fill many gaps in the understanding of brand and category behaviour, as well as what the customers would be interested in. There are preference centres where users may save their preferred brands, categories, and sizes in their accounts.

Rethink definitions of high lifetime value customers

Before luxury brands hit the e-commerce market, they were very selective in their customer base. They waited for customers to cross a high spending threshold before recognizing them. Today, they cannot do so. Luxury brands now use a lot of data science to comprehend initial purchase behaviours.

Some indicators are whether or not they register for an account, subscribe to emails, and what channel they enter through. To determine whether a customer might have a high lifetime value potential, they have developed a model that analyzes several marketing-related indicators.

Customers now want open and honest communication due to the climate change movement and increasing human rights violations. And luxury brands that fail to recognize this need for realism would be left behind in the race. Brands need to show up for their customers and community if they want to rebuild their relationships sincerely.

Collaborations with content creators

Creators are the actual advertisers in this new age. Gone are the days when only models and celebrities could advertise their favourite brands. Content creators understand the power of people, and they gladly hand it to them. Creators are the authentic influencers for the new generation of shoppers and they definitely help you maximize your online presence.

With every new collection, luxury retailers send their products to these creators in return for promotion and for creating awareness about their brand. This also creates engagement with the customers. These brands have gone further and involved celebrities in their strategic partnerships. Celebrities are launching their line of products in collaboration with luxury brands. The popularity of each collaborator is benefitted from such a strategic partnership.

Use of augmented reality and other technologies

Most of us pivot to luxury fashion brands when we think of luxury brands. But did you know that every sector has a luxurious brand? Even something like furnishing has a luxury brand. These luxury brands must adapt strategies different from those of a fashion house, makeup, or skincare brand.

They need to devise a different approach to increase customer engagement. Customers now want to experience the product before they purchase it. They want to see how it would look in their homes or offices. Fortunately, AR/VR has made this possible thanks to technological breakthroughs. Augmented reality is now so widely used that up to 40% of consumers believe they will purchase a product quickly if they can first try it out in augmented reality.

Live chats and chatbots for an on-site experience.

Online stores that do not offer live chat service on their websites see a decline in sales. Customers can avoid the line-up for customer support requests by using live e-commerce chat. Additionally, it enables your customer service team to give customers individualized service and forge an emotional bond with them.

Most people who visit e-commerce stores are either exploring products or comparing prices, but interacting with them at that time or when they need assistance can significantly increase your chances of turning them into customers. Although chatbots are not as intelligent as humans, they can simultaneously handle the majority of support requests for your support team, freeing them up to concentrate on more urgent and complicated customer issues.

Conclusion

Many luxury fashion firms have decided to digitize along maintain physical stores. Personalization and one-on-one intimate connections will dictate the future of luxury engagement. Luxury consumption is increasingly being defined by younger and younger generations who have a strong sense of individualism, and the key to staying relevant is emotional connection.

The world is catching up on digitization, and developing countries are adapting faster than developed countries. For example, India is becoming one of the biggest markets for e-commerce. There are many top eCommerce website development companies in India that can give exceptional services to their customers.

Ekta Patel

Ekta Patel

Ekta Patel is the Digital Marketing Executive at Selected Firms - a B2B Marketplace for Finding World Class Agencies. She is a Skilled Digital Marketer with 7 Years of experience in eCommerce, SEO marketing, Google AdWords, and social media content building. She has created quality content for the company's websites/apps, blogs, and case studies. In addition, she has profound experience working for IT organizations and is responsible for introducing the latest eCommerce trends to the team.

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