Académique Documents
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INSIGHTS
2014
LUXURY
DIGITAL
OUTLOOK
CONTENTS
4
EXECUTIVE SUMMARY
7 Introduction
10 WebsiteS
20 E-Commerce
24 Mobile
28
Social Media
34
Search & EMail
38
The Result
TRENDS 3
EXECUTIVE SUMMARY
Corbis
their technology based lives, changing current trends and consumer habits. Thus, the Middle Easts high-networth individuals are becoming a progressively, very demanding and hungry
consumer bracket.
With such rapid movement in consumer trends, particularly in the context of
our digitally advancing world, luxury
brands, advertisers and publishers are
on a persistent progression towards enhancing their digital properties, content
and offerings. An industry which had
once been left behind or wanted to
from our digital age, by continuing to
rely on the traditional media spill-over
from their globally branded content and
advertising, is beginning to change. The
luxury industry has been fearful and
hesitant of the digital sphere for many
reasons, from loss of exclusivity to sheer
indifference, but we are now witnessing
arabianEye
INTRODUCTION
The Need for a Luxury Digital Report
Corbis
FASHION BRANDS
Alexander McQueen
Alfred Dunhill
Armani
Balenciaga
Burberry
Calvin Klein
Carolina Herrera
Celine
Chanel
Christian Louboutin
Coach
Dior
Dolce & Gabbana
Elie Saab
Ermenegildo Zegna
Fendi
Corbis
Chopard
Corum
Damiani
De Beers
Dior
Graff
Corbis
Armani
Balenciaga
Hugo Boss
Bottega Veneta
Burberry
Cartier
Chanel
Chlo
Clarins
Clinique
Clive Christian
Creed
Dior
Dolce & Gabbana
Givenchy
Gucci
Giuseppe Zanotti
Herms
Hugo Boss
Jimmy Choo
Lanvin
Louis Vuitton
Marc Jacobs
Miu Miu
Nina Ricci
Oscar de la Renta
Prada
Ralph Lauren
Roberto Cavalli
Saint Laurent
Tods
Tom Ford
Tory Burch
Valentino
Versace
Harry Winston
Hublot
Jaeger-LeCoultre
Korloff
Longines
Neil Lane
Omega
Patek Philippe
Piaget
Raymond Weil
Rolex
Tiffany & Co
Este Lauder
Fendi
Givenchy
Guerlain
Herms
Jimmy Choo
Cavalli Fragrances
La Prairie
Lancme
Marc Jacobs
MontBlanc
Nina Ricci
Paco Rabanne
Prada
Tom Ford
Valentino
Van Cleef & Arpels
Versace
Yves Saint Laurent
the wealthiest consumers that the Middle East has to offer. Despite the regions
efforts to ascertain original content
development, and the popularity of this
movement, it still seems to be falling on
deaf ears.
For a while it seems that we in the Middle East have been happy to accept this
lack of effort and resign ourselves to
the fact that we are still an emerging
marketplace to these large international
businesses.
But times are changing, and with the
luxury market in the region growing
year upon year, the necessity to focus
on what the local consumer wants and
how they want to be engaged by a brand
is becoming more important. With the
Research Brands
Research Methodologies
Corbis
BRANDS SurvEYED
TRENDS 9
WEBSITES
Corbis
Introduction
ty of these were from Europe with the addition of Mandarin, Cantonese, Japanese
and Russian in many cases. However, we
wanted to dive deeper into how website
content was not only translated, but how
it was adapted and curated for the regional audience. To further expand upon this
examination, we looked at which brands
were using localised content and/or Arabic language content on their global websites. Localised content in this case is
defined as content created and written
specifically for the Arab market. Arabic
content, in this case, is defined as general
content translated into Arabic.
We then wanted to see if the brands had
any regional or country specific website
presence or content. Furthermore, we
developed this idea by examining the
websites functionality: from HTML vs.
flash, social media linking and sharing,
to product search and availability, to local
Global Websites
Arabic Content
Upon beginning to review the websites
we firstly looked at which sites gave users
the option to select their region, in our
case this was the Middle East, or a specific country within the region.
Out of the fashion brands only 33 per
cent listed the Middle East or any of its
countries as an option, followed by 27
TRENDS 11
Yes
No
8%
21%
92%
79%
93%
8%
Yes
No
92%
5%
95%
88%
94%
Corbis
92%
closer step towards engaging market-specific consumers, and allow for much more
freedom of localisation and the ability
to be much more targeted. However, we
found that this was not the case.
None of the fashion, watch or jewellery
brands that featured in our research had
any regional website for the Middle East.
The only four brands that came from the
fragrance and cosmetics category and
were the French beauty-market leaders
Clinique, Este Lauder and Lancme,
and Swiss cosmetics brand La Prairie.
We saw from this that it was the beauty products, i.e. products that are more
accessible, who are making headway in
the digital space. By having much more
leeway to use digital platforms, less strict
guidelines on Arabic content and branding, they have the opportunity to be
much bolder when it comes to localisation so as to not affect their overall brand
image or identity.
We then analysed if the brands had
country level websites.
The sole fashion brand to have country
specific website was British-born Burberry and for watches and jewellery,
Swiss luxury watch maker Piaget, both
with UAE-based URLs.
However, the Burberry site was only
available in English, making Piaget the
only brand within our list of brands to
have Arabic content on their country site.
The brands that had regional sites did
not appear in this country section, leaving the fragrance and cosmetics category with no country websites at all.
Website Functionality
Introduction
Expanding upon regionally specific
content and website presence, we also included website functionalities to highlight
the functional and user-experience competencies of the brands digital properties. The ability for a local consumer
to be able to locate a store near to their
home or office, see what a product costs
in their native currency, to merely having
a country specific customer service, are
Corbis
and cosmetics, as until recently with Burberry and Chanel in London, for example,
there have been no specific beauty stores
for luxury brands. Moreover, due to the
mass nature of their products and their
presence at multi-brand outlets, they may
not be able to be specific about store
locations. And yet we could surmise
that perhaps due to their products being
readily available and sold by international retailers it is probably easy to place
their locations.
Products
The next most prevalent point of information which online consumers will look for
are specific products.
89 per cent of luxury fashion brands featured their products for users to browse.
For watches and jewellery this number
goes up to 96 per cent, which is interesting when compared to the smaller
percentage of brands with store-locators
more products to view, but less option
to see where they are held.
TRENDS 13
11%
89%
6%
96%
94%
5%
3%
100%
95%
97%
37%
54%
63%
Corbis
71%
Getty Images
Getty Images
have integrated social in their day-today lives, but especially for their consumers of tomorrow where social channels
will be their default information, engagement, discovery and brand inspiration
platforms.
While we will go into much more detail
on this subject and its various and numerous platforms later, in terms of website
functionality we looked at whether there
were firstly social media links from the
websites and, secondly, whether brands
enabled direct social sharing of product
pages, specifically from their localised,
regional or country sites.
11%
89%
HTML
99%
9%
91%
Flash
Website Technology
technology in web environments a symbol of a brands slow uptake and adaptation into the digital sphere. HTML is the
most basic and standardised technology
through which websites are indexed by
all web browsers, and particularly search
engines for SEO. So, while Flash may
make a website look creative and interactive, it does not work well with many
browsers and can be extremely slow to
work and upload. Moreover, it disables
any search indexing possibilities, so engines like Google and Bing etc. will not
be able to read the site and rank it within
their search result listings.
Overall, a high majority of fashion
brands at 89 per cent had HTML webTRENDS 17
Website Results
Brand
Elie Saab (F)
Armani (F)
Lancme (F/C)
Clinique (F/C)
Este Lauder (F/C)
Score out of 34
19
18
18
18
18
Conclusion
discovered above there seems to be a major gap in some of the most rudimentary
digital competencies, but particularly the
amount of locally based content, presence
and functionality.
The reality is that global luxury brands
have yet to invest in optimising their
website properties in order to more effectively engage the local consumer on a
more personal and contextual level, and
this could be for many reasons. First, and
foremost, their perception of the markets
consumers habits and needs, followed by
general unwillingness and apathy towards
earned engagement via social channels because of loss of exclusivity in the
digital world.
The idea that the Middle East is still an
emerging market also means that many
brands believe the regions luxury market
is still young and behind the times when it
comes to e-commerce, online media and
Website Results
Overall, the highest scoring category, in
terms of website competency and technology, was fragrances and cosmetics with
10, followed by fashion with nine and
watches and jewellery with eight. However, if we only consider the elements
which were based on localisation of the
websites, the leading category, by a long
way, was fragrances and cosmetics with
the most Arabic content.
Recommendation
In the 2013 Luxury Brand Perception study by Havas, we found 95 per cent of the
regional respondents researched luxury
products online, and no doubt websites
would have been their first point-of-call.
While some in the Arab World do read
English, many do not, and therefore it
is imperative to have at least an Arabic
translation available. Localised content
Fashion
Watches
& jewellery
Fragrances
& cosmetics
E-COMMERCE
Introduction
Yes
No
25%
26%
74%
75%
30%
26%
74%
70%
E-Commerce Results
12
8
4
0
Fashion
Conclusion
Watches
& jewellery
Getty Images
Fragrances &
cosmetics
research has told us (Luxury Brand Perceptions and Habits 2013), that 50 per cent
of respondents in KSA and the UAE are
now buying luxury brands online, e-commerce is a real opportunity for these brands
to capitalise on. Moreover, if regional or
local distribution is an issue and reason behind this absence, there is nothing to say
brands cannot ship from their central distribution house as it seems to be no issue
for several brands who are already shipping to the Middle East. In addition, this
line of thought can also be taken when considering the problems surrounding online
payment and delivery albeit that KSA
is a separate situation altogether. Therefore, it seems that e-commerce is perhaps
a platform which brands globally remain
indifferent to, and that without local content there is not the incentive or motivation
to enhance their e-commerce channels to a
market-specific level.
E-Commerce Results
For this section the scores on global
e-commerce properties in general were
quite high, a promising sign indeed for
luxury digital growth and the regional
market of a zero base locally and a minuscule base globally. Across the section
we examined 12 e-commerce elements
that the brands should have on their
websites.
None of the 95 brands investigated had
any form of regional e-commerce.
For the fashion category there were
several leaders with the same score, they
were: Jimmy Choo, Ralph Lauren, Saint
Laurent and Versace with nine, followed
by Tory Burch, Giuseppe Zanotti and
Alfred Dunhill with a score of eight out
of a possible 12.
Within the watches and jewellery category, the only brand that qualified into
having a score was De Beers, as it was
ing, watches and jewellery scored a seven, as did fragrances and cosmetics.
Recommendation
Whilst shopping in the region remains a
very social activity, with local consumers
usually shopping with groups of friends
and family, we are seeing a continuing
march by the Arab World to shop online
and as part of their daily routine. Quite
similarly to the websites, the more localised and luxurious the e-commerce experience can be the better. Brands should
also pay much more attention to local and
easy payment options, up-to-date currency
conversions for specific countries, tracking, shipping and return services, as well
as the packing of the product upon delivery. Local customer service is, again, very
important at this stage and should always
remain prevalent throughout the entire
purchase process.
TRENDS 23
MOBILE
Corbis
Introduction
M-Commerce
m-commerce was Burberry, a strong digital brand throughout this research. However, as with their e-commerce site, they
did not offer shipping to the Middle East,
even though prices were shown in Emirati dirhams and products could be added
to your cart.
Applications
It is interesting to see within this mobile application section that the watch
and fragrance category had the largest propensity of brands feature, while
elsewhere in the research they have
fallen well behind in several major
sections and competencies. In terms of
content, none of these applications were
in Arabic.
Consequently, we then analysed iOS
products with Apples iPad and iPhone.
22 per cent of brands did have an iPad
app, and 23 per cent had an application
available for iPhone.
While there was as nascent level of
applications across all platforms, none
of the brands had any regional or localised application.
Further to this, we looked at what
devices were able to view these
applications.
While the majority of the brands did
not have an application, we saw that iOS
Conclusion
6%
Neither
IOS
IOS and Android
Android Only
54%
3%
5%
28%
64%
Mobile results
10
have been done by luxury brands to understand the Middle Easts mobile-user in
terms of brand usage and consumption of
mobile content. Yet, with Burberry leading the way in this category, in design and
enhanced user experience, it is evident
that a few principal international players are realising the importance of mobile and tablet platforms to enhance their
overall digital and integrated offering.
The leading category in this section was,
in fact, watches and jewellery with an average score of three. Fashion, as well as
fragrances and cosmetics both averagely
scored two to fall just below.
Recommendation
Over the next year or so we will see continued and escalated demand for all types
of connected content and experiences via
mobile and tablet platforms. In turn, this
will create a greater demand for highly
customised content and mobile-led ex-
8
4
0
Fashion
Watches
& jewellery
Fragrances &
cosmetics
TRENDS 27
SOCIAL MEDIA
Getty Images
Introduction
25%
4%
4%
Yes
No
96%
75%
96%
24%
30%
26%
70%
76%
Results
Getty Images
Brand
Clarins (F/C)
Burberry (F)
Lancme (F/C)
Louis Vuitton (F)
La Prairie (F/C)
3%
97%
20
15
10
5
0
Fashion
Watches
& jewellery
Fragrances &
cosmetics
arabianEye.com
Conclusion
Instagram regional presence and the proliferation of Arabic on mobile and search,
luxury brands are missing out on a significant engagement opportunity throughout the Middle East. Pinterest however,
while it is a suitable platform to generate
awareness, does not have the ability to engage and earn followers that Instagram,
Facebook or Twitter has, nor does it have
the same ability to control how content is
shared, and in general its proliferation as
a channel is not as high as these other social platforms.
Online video has become an increasingly central component to the digital media
scene over the past decade, with almost
all luxury brands having global YouTube
channels. With television commercial
clutter increasing, luxury brands are now
using online video to continue the story
No doubt, consumers today want to be engaged. With the younger generation having
more buying influence and fearlessness to
try new forms of communication, brands
must not forgo social channels. The key
focus, therefore, must be to build brand
desire for both current and new consumers, without becoming too accessible to the
mainstream. By sticking to strict content
and strategy rules, the online consumer
experience and brand perception can be
exactly as it is in-store or at VIP events
exclusive and personal. In doing so, the
brand also becomes more engaged with
the consumer and thus more meaningful.
So, where a media strategy was once linear (brand-media-consumer) in the digital
world and especially with social media, it
can become circular (brand discovery-engagement-immersion-validation) a total
360-degree approach, and still remain as
elusively powerful.
In another proprietary Havas research
study we saw that over 90 per cent of
luxury regional consumers used a variety of social media sites each day (Luxury Perceptions and Habits in KSA and
the UAE 2013), and with the Middle East
having over 90 million unique internet
users (Source: InternetWebStats.com),
it seems unjustifiable that brands are not
there to engage with them. From the luxury consumers in our Luxury Perceptions
research, 58 per cent of respondents followed luxury brands to keep up with
trends, fashion and would like to see more
local content on social sites. We could also
infer that this percentage would be higher
if more brands were present on social media to be followed at a local level.
Results
Across all of the social media platforms
we looked at a very large number of digital competencies in this field. We saw
Recommendation
Paid Search
23%
3-5 a month
10%
1-2 a month
11%
77%
8%
7%
68%
0 newsletter sent
SEARCH Results
4
2
0
Conclusion
Upon our analysis in this sections, a remarkably low number of luxury brands
were engaged in paid search activities
within the Middle East.
Given this lack of competition, the development of even a small SEM plan
will allow for ownership of generic
keywords on search across the category.
This shortfall is most likely a symptom
of the lack of regionally relevant website and social properties in the Middle
Fashion
Watches
& jewellery
18%
Promotional newsletter
19%
Score out of 6
6
6
6
6
6
Corbis
Brand
Jimmy Choo (F)
Gucci (F)
Miu Miu (F)
Dolce & Gabbana (F)
Chanel (F/C)
Informational newsletter
Fragrances &
cosmetics
Results
Across Search we had six possible elements that brands could score in. Overall, the results were quite high, with the
majority of all brands covered scoring
five points.
Therefore it was the major fashion houses with the highest average score in this
section with four, and watches jewellery
and fragrances and cosmetics both with
two. If the content of these e-newsletters
were taken into account, we would have
seen that much of the content covers all
of their various lines, particularly for
fragrances and beauty.
Recommendation
Search activity must be done by any
Brand
Louis Vuitton (F)
Ralph Lauren (F)
Dolce & Gabanna (F)
Burberry (F)
Gucci (F)
15
10
5
0
Fashion
Watches
& jewellery
Fragrances &
cosmetics
THE RESULTS
The final part of our LuxHub research
was to provide an overall score, taking
into account the individual scores in each
core section. Each brand was given one
point for each of the base digital competencies that are considered as the universal elements that all luxury brands digital properties should include.
Throughout this scoring system our focus remained on those elements which
most greatly affected a brands regional
and local presence and content, and within that, the digital sophistications which
were used.
As we have seen during this research,
regional presence and content is almost
Dior 30
Dolce & Gabanna
35
Elie Saab
32
Ermenegildo Zegna
21
Fendi 25
Givenchy 21
Gucci 33
Guiseppe Zannoti
21
Hermes 21
Hugo Boss
23
Jimmy Choo
29
Lanvin 35
Louis Vuitton
34
Marc Jacobs
32
Miu Miu
26
Nina Ricci
17
Oscar De La Renta
21
Prada 22
Ralph Lauren
38
Roberto Cavalli
26
Tods 22
Tom Ford
16
Tory Burch
36
Valentino 27
Versace 27
YSL 33
Neil Lane
20
Omega 21
Patek Philippe
12
Piaget 40
Raymond Weil
21
Rolex 30
Tiffany & Co.
20
Van Cleef & Arpels
22
Zenith Watches
8
Creed 18
Dior 30
Dolce & Gabanna
24
Este Lauder
21
Fendi 25
Givenchy 21
Guerlain 19
Hermes 21
Jimmy Choo
27
Cavalli Fragrances
16
La Prairie
20
Lancme 25
Marc Jacobs
23
MontBlanc 24
Nina Ricci
18
Paco Rabanne
19
Prada 24
Tom Ford
14
Valentino 23
Van Cleef & Aprels
23
Versace 27
YSL 32
OVERALL SCORES
Overall SCORES
Corbis
FASHION Score
Alexander McQueen
31
Alfred Dunhill
26
Armani 36
Balenciaga 29
Burberry 48
Calvin Klein
21
Carolina Herrera
19
Celine 13
Chanel 33
Chloe 26
Christian Louboutin
18
Coach 25
Damiani 20
De Beers
23
Dior 20
Graff 16
Harry Winston
26
Hublot 18
Jaeger-LeCoultre 26
Korloff 21
Longines 19
110
100
90
80
70
60
50
40
30
20
10
0
Fashion
Watches
& jewellery
Fragrances &
cosmetics
TRENDS 39
Getty Images
CONCLUSION
Luxury and the Digital Space
brands should forget traditional advertising mediums and other forms of engagement. An integrated, non-linear strategic
approach is consistently the best way for
deeper brand enrichment, and to keep up
with their consumers rapidly developing
buying, research and media behaviours
which are spanning all platforms simultaneously.
Across and throughout everything that
luxury brands do and produce in the
digital space, it is imperative for them to
remember their end consumer and their
context, to ensure that that it is relevant
Content is King
APPENDIX
ABOUT LUXHUB
ACCREDITATIONS
LUXHUB
INSIGHTS
2014
LUXURY
DIGITAL
OUTLOOK