While brands continue to prefer the more exclusive traditional sales channels, new online projects are seeing the light of day. TAG Heuer is one of the brands to have taken the leap this year with the launch of its first online stores for the United States, United Kingdom and Australia, says the La Chaux-de-Fonds firm’s spokeswoman Mariam Bouaziz. Audemars Piguet is set to follow suit. “Retail sales are not confined to bricks and mortar. The next step is online sales,” declared Chief Executive François-Henry Bennahmias in a recent interview. The company intends deploying online very quickly, within the next twelve to twenty-four months, and should be proposing all its watches for sale on its website. “It’s a revolution,” Bennahmias continued. “The store has to go to the customer now that future buyers are savvy about placing orders online.”
Timid first steps
According to Digital Luxury Group, e-commerce currently accounts for some 5% of the luxury industry’s revenues. In 2011, online sales of luxury goods increased 28%. From €6.2 billion in 2011, they are expected to reach €15 billion by 2016. And this is just the tip of the iceberg, as the majority of people research their “traditional” purchases online. In roughly 50% of cases, customers buying a luxury product first visited the brand’s website or logged on to social media sites, says David Sadigh, founder and CEO of Digital Luxury Group, in Swissquote Magazine. Watchmaking, however, appears to be lagging behind.
Some have taken the plunge nonetheless. Montblanc, for example, proposes certain items for sale on its website, such as pens, belts and leathergoods. Cartier also offers visitors to its website a selected range of products, as do Longines, Rado and Tissot. Alexander McQueen, Versace, Stella McCartney, Baccarat and Van Cleef & Arpels are also e-commerce recruits. The Vacheron Constantin website includes a function to customise its Quai de l’Île model, including a personalised engraving on the case back. However, an order can only be placed by visiting one of the company’s points of sale with a saved copy of personalisation details. Richemont set its e-commerce ball rolling in 2010 when the group acquired 100% of the UK-based online clothes retailer net-a-porter.com. The transaction put a €394 million value on the start-up, considered to be one of the internet’s biggest success stories as a distributor of hundreds of top brand names worldwide. Italy’s Yoox.com, which is floated on the stock market, has also developed a multi-brand offering and operates several e-stores. Last year the company reported 14 million unique visitors a month and took 2.3 million orders.
Very Important Shoppers
Interviewed in the French business magazine L’Expansion, Federico Barbieri, director of digital strategy for the Kering luxury group whose portfolio includes Girard-Perregaux and JeanRichard, declared that “enriching the customer’s e-commerce experience is one of Kering’s priorities.” The idea is to offer millions of internet users a VIP experience by offering them exclusivities, sneak previews and personalised products. This is already the case at Hermès, for example, which delivers a tie purchased online to an address in Paris within three hours. The company also proposes selected watches on its website. Ralph Lauren offers a “create your own” service for its polo shirts; Longchamp retails a range of custom-made bags exclusively online, while watchmaker Bell & Ross has opened its online store on Facebook.
Sooner or later, the rise and rise of the web will doubtless convince even the most sceptical to launch online sales. First though, brands need to get over their fears, which range from losing control of their image to dehumanising the sales process, and of course the problem of fakes. Like it or not, watchmakers cannot ignore the digital revolution. Luxury brands were quick to integrate the web into their communication strategies; making it part of sales strategy is a taboo they have still to overcome.