5 Things You May Have Missed This Week
By Georgia Buchanan
1. LVMH’s Luxury Lab
As Karla Otto’s Head of Digital, Zoe Patoff, insisted at our last FashTech Talk “Luxe in Flux”, customer personalisation is key to a brand’s success in todays society. And LVMH seem to have got the memo, hosting its first Luxury Lab at the Viva Technology innovation conference in Paris with 50 international startups pitching new digital technologies over a three-day showcase. A mutually beneficial process for both LVMH and the startups, the lab will open up LVMH to a huge host of new innovative ideas at no cost to them, whilst the startups are up for the chance to win investment from a hugely successful umbrella company. Whilst not all startups are guaranteed investment from LVMH following the Luxury Lab, they’ll all receive introductions to both LVMH-owned brands as well as the LVMH venture fund, Groupe Arnault.
Morty Singer, CEO of business development firm Marvin Traub Associates and co-founder of Orchard Mile, one of the companies participating in the Luxury Lab, said: “It’s very important for new companies to continue to form luxury in all shapes and sizes. Luxury brands still perceive [e-commerce] as too readily available or ubiquitous. LVMH’s service explores the technology and innovation out there, and it’s a powerful initiative.”
The selected startups were chosen for their ability to personalise through a strong customer understanding: “cracking consumer date and providing a more personal, distinct experience that fosters customer loyalty” (glossy.co) Examples of the startups involved are: e-commerce platforms Orchard Mile, Ordre, Swoonery and Auctionata, and tech companies Tulip Retail, Cinématique and MemoMi. Singer said: “The Luxury Lab isn’t just about LVMH seeing what we have to offer. It’s about the camaraderie for startups in the luxury industry who have a similar goal in mind.”
With its key priorities clearly set for 2016 as “differentiation, personalisation and digitisation”, LVMH’s Luxury Lab is a great forum in which to kick start a new era of innovation for the company, pooling both external startups’ ideas and internal ideas from LVMH-owned brands like Guerlain and Sephora. The company is also using platforms like Facebook Live to give an exclusive look inside the Luxury Lab process across social media.
Swoonery founder, Jean Poh, said of the importance of tech in personalising the retail experience: “As digital tech and media becomes more prevalent, the general tendency is to think that people using that technology are creating more distance between brands and experiences. The future of luxury retail is going toward places and platforms that can leverage both market power and convenience.”
2. Snapchat Takes On Couture
Snapchat has been killing the fashion game recently, but one area that hadn’t yet been tapped into was couture. That was, until now. With a USP in the social media world of being authentic, relatable and un-edited, Snapchat has never previously seemed like an obvious fit with couture. The latter usually being perceived as anything but relatable, and never being shown in any form but its most polished and complete. However, following the huge success of the ‘new kid on the block’ platform in the fashion world, a few couture brands are starting to catch on, thinking of ways in which they can make the app work for them.
On Tuesday, Snapchat launched its first Live Story focused on couture shows, including Armani’s and Chanel’s, allowing users to feast their eyes on exclusive photos and videos from never previously broadcasted catwalks and behind the scenes sneak peaks of pre- and post-show madness. Even Karl Lagerfeld made a stealth appearance. The content is generated by both users and brands, and then collected through the use of geotagging before being curated by Snapchat. Brands can also choose to sponsor content in Live Stories, meaning they have a guaranteed time slot within the day’s videos. With a user base of 100 million users, 10-20 million of whom watch Live Stories each day, posting content on Snapchat gives the couture world the chance to reach a huge, and mostly previously untapped, demographic.
Whilst Snapchat may still be sitting in second place behind Instagram as the fashion follower’s favourite social media platform, it is increasingly being used alongside Instagram by brands who want to create a more omnichannel approach and reach their consumers across all mediums. Whilst Instagram delivers a more curated, manicured overall image of a brand, Snapchat can offer a very different, but still just as craved for, view into a fashion house, allowing the consumer to see the more raw, unedited, real vision of the brand in progress. As Emilie Fife, senior manager of digital communications at the Council of Fashion Designers of America’s, said: “Snapchat is giving a new conversation.” She explains that designers in the CFDA’s incubator are really eager to work with the platform. “If you are featured in a Live Story, if people see your name and product, that is huge for you,” she said.
Andre Cohen, Coach’s president of North America and global marketing, explained of the app: “Even after being on the platform for a year, Snapchat is still about experimentation, as it’s a much different medium than the more ‘traditional’ social platforms we’ve been leveraging for years. [Snapchat] keeps us on our toes and allows for original thinking, and we pride ourselves on being active consistent community participants on the platform - not in and out sporadically.” And now this enthusiasm is spreading to the high fashion world. In September 2015, Burberry showed runway looks the night before the show via Snapchat and this April, it became the first luxury brand to have its own Discover channel on the platform. Gucci often uses the app to reveal new products, and Bloomingdale’s have an “As Seen on Snapchat” board on Pinterest to highlight merchandise used in its online stories.
Personalisation and consumer experience are starting to stand out as two key ingredients needed to stay ahead in the fashion and retail game nowadays, and Snapchat seems like a perfect platform in which to nurture and progress both these areas. As Toni Box, senior director of social media at PMX Agency, said: “What’s appealing for brands is the opportunity to form a more personal, one-to-one connection with customers. They’re realising the platform can help to foster the important relationships that eventually lead to brand affinity and loyalty.”
3. Yoox Net-a-Porter’s Focus: Millennials and Mobiles
Having been labelled the “world’s biggest luxury fashion store” by Natalie Massenet, it’s no wonder that Yoox Net-a-Porter is being held as an example of success for the new kid on the block, Amazon. The giant e-commerce site announced a growth plan this week that predicts a 17-20% revenue growth every year until 2020.
An incredibly bullish business plan from Federico Marchetti, chief executive of YNAP, these targets will be tough to follow through on at a time when the world’s biggest luxury groups are suffering visibly from “the slowdown among China’s super spenders and a continuing struggle to make their brands relevant to the online shopper” (The Telegraph). Cue the focus on mobile and millennials. Marchetti believes that YNAP can capitalise on the continued rise of mobile shopping, increased spending from millennials and the growth of so-called “ultra fine” luxury products.
A number of luxury fashion labels who have previously been anti-online selling are now being left with very little choice but to accept the sign of the times and go digital. And for these high end fashion labels, YNAP is the obvious platform through which to sell as there are no other sites which match their level of luxe. Amazon may be trying to find its footing as a competitor to the established luxury fashion store, but with its “Everything Store” image already well in place, it’s going to take some time (and some seriously creative thinking) to be able to lure the designer labels away from the security of YNAP. This week, YNAP was delighted to announce the addition of Prada to its long list of luxury brands, which already includes the likes of Chanel and Christian Dior. The online store also revealed that it will now begin selling fine jewellery and watches from its site as well.
In the online luxury retail sector, there will always be doubts and questions to work through; e.g. Will the number of consumers who are prepared to buy luxury goods online ever come close to the number of consumers who will only buy their luxury goods in store? And can an online retailer recreate that giddy feeling wealthy shopaholics crave after parting with serious cash? But Marchetti is confident that the plan they have in place is a powerful one. “The company already has 2.5m “high value” customers who spend more than €10,000 a year and around three quarters of orders are from mobile phones. Tellingly, the company also expects millennial shoppers to count for half of the total global luxury market by 2025” (The Telegraph).
The company also puts a lot in, in order to get a lot out. They invest huge amounts in to maintaining a service at the highest level, for example the editorial content, style tips and Vogue-worthy photoshoots that accompany any online purchase of YNAP’s luxury products. It is a long term model by which they work and it is serving them well. There is no doubt that Amazon’s presence is being felt by YNAP, but Marchetti was quick to dismiss the idea of the “Everything Store” existing in the same space as his luxury store!
4. Delivery! Why The Box Matters
At our London Summit in April, we had a panel on “Delivery: Pain No More” with speakers Charlotte Abercron, Glossybox’s UK & Ireland MD, and Luke Davids, chief executive at Parcel For Me, to discuss the way in which customer’s expectations for the delivery experience have heightened, and the creative ways in which companies are working towards meeting these expectations; whether it’s to make the process as simple and smooth as possible, or whether it’s about making the delivery as exciting and beautiful and on-brand as possible.
It seems that nowadays, with retailers constantly vying to stay ahead of their competitors through greater in-store experience, this competitive and creative edge has crossed over to their deliveries also. Racked asked this week: “When did shipping boxes get pretty?” And it’s a valid observation. Aritzia, Birchbox, Matchesfashion, Urban Outfitters and many many more brands have completely upped their delivery game, with the likes of custom coloured boxes, interior surprises, personalised messages, bold brand messages and logos, printed packing tape and colourful bubble wrap. It is the online equivalent to a status-symbol shopping bag and in-store gift wrapping; something to make you feel excited about and proud of your purchase. It’s also just sooo “Instagramable”. Send your customers beautiful, colourful boxes and you are far more likely to see them popping up all over social media, tagging your brand and giving you great, aesthetically pleasing exposure. Last year, Dotcom Distribution found that 39% of online shoppers shared a product image or a video on social media. Glossier head of design, Adriana Deleo, said: “We know our community is super active on social media and will share images once they receive their products. We want every detail of the unboxing experience to be exciting, surprising - and photogenic.”
As we know, shopping is becoming about the experience, the personalisation, and the aspirational factor it presents for the consumer. These fun and beautiful boxes create just that. An element of excitement that is more than just the product they have purchased, but is about being immersed in the brand’s world for that moment in time. Not only this, but it benefits the brand by creating free marketing for them, with beautiful, trendy delivery boxes often being kept and used on desks at work or at home. It is the gift that keeps on giving, for both sides! Dotcom Distribution’s 2015 study also found that 61% of online shoppers think pretty packaging makes a brand look “upscale,” and consequently 4 in 10 consumers are more likely to recommend a product to a friend based solely on branded packaging.
So it may increase a brand’s outgoings somewhat to step up their delivery game, but by the sounds of things it is 100% worth it, and if everyone’s going to be doing it soon, best to get a head start on the game.
5. Instagram Takeover: VINAYA
This week we had the pleasure of hosting designer wearable tech creators, VINAYA, on our Instagram page for a day. The team over at the VINAYA lab and studio took over our account on Tuesday and gave us all an awesome sneak peak into a day in the lives of the hugely successful and innovative company.
A couple of the posts showed their latest product, ZENTA, the next generation wearable that tracks mental wellbeing, for which they have given FashTech an exclusive discount offer. If you missed it this week, HERE is the link to pledge for the product and in return receive your one-off 60% discount!
Next week will see the sixth contributor to our Instagram Takeover series, and I am very excited to announce that we have the brilliant Debera Johnson of the Brooklyn Fashion + Design Accelerator set to take the reigns on Wednesday 13th. Having been one of the favourite speakers at our London Summit in April, we are very excited to see an exclusive look into Debera and her team’s work on ethical and sustainable fashion. So make sure to tune in next week!