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Digital Marketing min read
Let’s be honest: the luxury sector has not been the most enthusiastic advocate of online commerce. Despite a significant growth in eCommerce activities for luxury brands in the past years (the amount of personal luxury goods sold online increased by €29 billion between 2010 to 2019), many of them are, still today, afraid of the impact that digital marketing investments could have on their brand image. Unfortunately, the pandemic has accelerated the evolution of ecommerce, and it’s safe to assume that digital habits that emerged during the COVID crisis will not vanish once things get back to normal. Looking at the impact the pandemic has already had on revenue in the luxury sector (the LVMH and Kering groups, for example, saw an average of -28.8% decline in revenue YoY for H1 2020), it is clear that if luxury brands could still afford to rely on their brick and mortar stores to survive prior to the COVID crisis, they will now have to shift their strategy to eCommerce if they want to avoid extinction. But in times like these, having the most beautiful website and user experience is not always enough to make up for the revenue loss caused by the pandemic. And that’s where online marketing, and especially affiliate marketing, comes into play. Let us tell you how affiliate marketing could help the luxury sector recover from the crisis.
While there is little chance that customers are not aware of luxury brands, shoppers knowing about their current product offering is another question; and in post-pandemic times, luxury brands cannot afford to rely solely on their own clientele: they need to diversify their presence in order to drive additional customers to their website. The good news is that affiliate marketing is THE strategic customer acquisition vehicle that will help luxury brands acquire the best kind of customers. However, each source may not bring the same type of customers, and luxury labels should therefore focus on the ones that bring them the kind of customers they need without compromising on their brand positioning.
One common reason why luxury brands are reluctant to invest in other traffic sources is the impression that they won’t have any control over the way their brand and products are presented. However, this is not necessarily the case. Nowadays, many publishers offer luxury-dedicated sections within their websites, thus enabling luxury brands to benefit from their services while ensuring that their brand identity is not compromised. The Stylight website, for example, features high-end mono brands in Luxury Loft, an exclusive luxury section that enables exactly these types of brands to get extra visibility while keeping their exclusive brand positioning. This fear of losing their exclusivity is therefore a misconception that many luxury brands today are still believing in. By carefully choosing the channels they associate their business with, luxury brands can have full control over their brand image and remain as exclusive as they wish.
At times like this, each sale matters; and with plummeting sales and a decline in revenue for luxury brands due to the pandemic, now is not the time for them to lose sales to their competitors. By partnering with affiliate publishers, luxury players are given a terrific competitive advantage: gain added visibility for themselves and consequently additional market share. As mentioned above, some luxury labels are indeed still reluctant to use affiliate marketing, which means that those already embracing affiliate marketing enable their brand and products to get more visibility than those of their competitors. And for those noticing that their competitors joined the affiliate marketing game a bit before them, don’t let your rivals grab all the attention: you are missing out on potential customers while your competitors are already getting the benefits of being there.
By now it should be clear: by using affiliate marketing channels, brands are in control of who they associate their brand with. But besides the aspect of controlling their brand image, partnering with additional channels might give them a fierce advantage: having unique insights into the minds of their potential customers in specific markets. The Stylight search platform is, for example, available across 16 markets, and we can tell you that each market has different specificities, which our experts know everything about. This market knowledge that publishers bring to luxury advertisers can be very useful for those looking into the possibility of capturing new markets, while limiting investments to those required for affiliate marketing.