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Luxury Brands Develop Digital & Personalized Experiences To Scale

August 17, 2020 Carolyn Harding

Consumers have become more thoughtful with their spending habits in light of the pandemic and corresponding uncertain financial stability, leading nearly all industries to feel some type of ripple effect. Luxury experiences and high-end goods are also impacted, and many luxury brands have been working overtime to keep their businesses afloat, with McKinsey predicting the global luxury goods market will drop 35% in 2020. However, 2020 has also presented itself as an opportunity for luxury brand marketers to develop fresh and relevant strategies to reach consumers.

“For many companies, this crisis [the pandemic] has been a catalyst for developing and executing an online and omnichannel strategy,” notes McKinsey.

Luxury Fashion Adapts To A Digital-Centric Landscape

Shutterstock_494151793 Pretty businesswoman in black short dress sitting on stairs outdoor. She wears high heels, working with laptop, speaking on phone

Keeping up with the latest fashion trends and showing off your newest designer purchases typically correlates to social events and being out and about – making the current pandemic a major roadblock in luxury fashion. Add the temporary closures of so many brick-and-mortar stores, and it’s no wonder many high-end fashion brands have altered their approach to reaching and engaging consumers as of late.

Most recently, high-end fashion brand Burberry showed its ability to conform to the new norms, creating a social retail store in Shenzhen, China. Burberry shared that the store combines “the physical and social worlds in a digitally immersive retail experience – a store of tomorrow for today.” According to Mobile Marketer, “Burberry's in-store merchandise is labeled with QR codes that connect to digital screens and unlock new content and add to shoppers' social currency.”

The store is designed to take consumer interactions on social channels and bring them to life through traditional retail stores. Each room within the new Burberry social retail store has a unique persona and experience for shoppers. “We have pioneered a new concept that will redefine expectations of luxury retail,” said Marco Gobbetti, Burberry CEO. Adding, “It [the social retail store] marks a shift in how we engage with our customers and we can’t wait to share this innovative experience with the world.”

Iconic fashion magazine Vogue also sprinkled in a little bit of hope for the luxury fashion world through its newest partnership with Amazon Fashion and the Council of Fashion Designers of America. Working to help struggling designers during this time, the brands donated $500,000 to A Common Thread, which raises money and awareness for those in the American fashion community. In addition to the generous donation, a digital storefront was created to give fashion designers “access to Amazon’s vast customer base and advanced fulfillment network.”

Health & Wellness Evolves Into A New Form Of ‘Luxury’

US Health & Fitness App Users eMarketer chart

With the significant growth of Peloton, Lululemon and similar high-end fitness brands, health and wellness has transformed to now represent “luxury” experiences in the eyes of many consumers. During the pandemic in particular, many consumers hit pause on their searches for luxury vehicles or high-end clothes, and, instead, invested in their wellness through different fitness luxury options they can obtain while at home.

eMarketer believes the U.S. will see almost 20 million additional Americans tapping into health and fitness apps this year, bringing the total to 87 million people. In a recent podcast, eMarketer principal analyst Andrew Lipsman shared that he believes there are four key players in the luxury fitness game today: Nike, Peloton, Lululemon and Apple. Apple has proved itself as a leader in the wearables market, while Lululemon reigns supreme in high-end athleisure and recently acquired interactive fitness brand, Mirror. Peloton brings the luxury fitness experience inside to consumers’ homes. And Nike, of course, has been a staple in the fitness world when it comes to its ecommerce capabilities. Lipsman went on to add that luxury fitness has become a key piece of a broader growing trend: consumer health.

These luxury fitness brands like Peloton and Lululemon are transitioning to lifestyle brands by offering consumers products and services they can use in their everyday lives, ultimately creating life-long customers. As more people continue to transition from physical gym locations to at-home options in light of the pandemic, luxury fitness will likely cement itself as a top fitness option for consumers.

From First-Class Plane Tickets To RV Resorts: Luxury Travel Takes An Unexpected Detour

With the pandemic halting air travel for many and stay-at-home orders keeping consumers indoors, summer travel plans have been brought to a quick halt. As a result, the luxury travel industry has had to adjust to what the “traditional” traveler will look like for the foreseeable future, bringing aboard a new wave of luxury travel experiences.

Private plane company Blade reported a spike in sales for its flights since the start of the pandemic, while Elite Adventure Tours is responding to increased demand for its socially-distanced $15,000 outings. One of the biggest surprises in luxury travel during the pandemic, however, is the outpouring of consumers relying on high-end motorhomes and RV resorts to fill their vacation voids.  

Shutterstock_1470798161 Woman in the interior of a camper RV motorhome with a cup of coffee looking at nature.

Luxury RV resorts offer travelers spacious, high-end options to park their motorhomes and enjoy a slew of amenities – from personal pools to spas to complete fitness centers. Desert Shores, for example, welcomes any guest with a “class A motorhome” and provides each RV with its own lot, or “villa,” fully equipped with a personal hot tub, patio, garage and more. The price of luxurious motorhomes can run between $50,000 to $3 million.

Since the start of the pandemic, several luxury RV businesses have seen increased demand. RVshare reported a 650% spike in sales, while luxury motorcoach brand Featherlite Coaches said sales and deliveries have more than doubled. Mountain Falls Luxury Motorcoach Resort, known for hosting an impressive guest list, saw a 127% rise in sales year over year. “RV ownership has gone up in the industry, and I think it's related to the fact that RVs are probably the safest way to travel for the next few years,” said Chad Geffert, Motorcoach Resort General Manager.

The future of the luxury travel industry will likely revolve around secluded getaways (that still offer the same high-class experiences) and more thoughtful travel plans. “In general terms, we believe we will see people traveling less but traveling better; so going for longer and thinking more carefully about their holidays,” said Tom Barber, Co-Founder of Original Travel, a luxury tour operator.

Consumers throughout the luxury market are accustomed to above-average experiences from start to finish. With the pandemic front and center, the desire for luxury has not changed, but the way in which it needs to be delivered has. Brands that produce high-quality experiences and services while prioritizing personalized consumer journeys are likely to see an increase in consumer engagement and revenue during the pandemic and beyond.

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About the Author

Carolyn Harding

Carolyn Harding is an Associate Manager of Communications at Digital Media Solutions (DMS), the fastest-growing independent digital performance marketing company. DMS helps its clients accelerate growth by deploying diversified and data-driven customer acquisition solutions that deliver scalable, sustainable and measurable marketing results. DMS performance marketing solutions connect the right consumers with the right offers at the right time to achieve the marketing objectives of our clients. DMS is continually innovating to provide new and emerging media and technology solutions that minimize waste and maximize results across the most competitive industries. Since its inception, DMS has demonstrated incredible year-over-year growth which has earned recognition on the Inc. 5000 list in 2014, 2015, 2016, 2017 and 2018.

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