Information Technology Reference
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brand image to retail. Most luxury brands were also conscious of the fact that
the Internet was still perceived at this time to be a channel distribution for
price-discounted products and a destination for people looking for “deals”
and “steals”, some of which included counterfeit or fake luxury products.
It took the likes of Louis Vuitton, which first introduced e-retail in the
US through e-Luxury.com in 2002 and subsequently in France and other
European destinations from 2005, and Gucci, which first started retailing its
products online in the US in the same year to change this. These brands were
considered by other luxury brands as profit-driven “sell-outs” that were in the
process of damaging their brand values by placing their products in a mass-
market channel. Other US high-end brands like Coach and Tiffany's which
had developed e-retail were also considered as brands that would never be
able to claim true luxury status. It was during this time that two of the most
reputable French luxury brands bluntly confirmed to me that they would
never put their products to be sold online. Their stance has, however, changed
since, fortunately for them, although they're both apparently playing the
catch-up game and performing poorly online.
In the meantime wealthy consumers were buying everything online, from
flight tickets to entertainment, electronics, furniture and home equipment.
They were also using the Internet for a vast range of services including bank-
ing, trading, investments, academic learning and even e-health programs.
Even as this wealthy group transferred their e-retail expectations from the
collective experiences that they had garnered from purchasing other types of
products online, several luxury brands turned their eyes away from e-retail.
The media also accentuated this aversion to e-retail. It was not until 2006 and
2007 that major magazines like
Vogue
,
Elle
and
Glamour
considered making
the inclusion of the website addresses of their featured brands a requirement
for the editorials and adverts - the telephone number of the store was more
important, although one can easily obtain the telephone number and address
from the website!
However, the landscape has changed and, with the evolution of technol-
ogy, the luxury sector and those that are affiliated with it have come to realize
that the Internet is an essential complementary channel to offline retailing.
Also, the advancement of security and payment systems has contributed to
dispelling the fears related to protecting personal information and exposure
to fake goods. The advent of the social web and exclusive online communi-
ties that congregate the wealthy have also contributed to overcoming the idea
that the retail of authentic luxury goods can only take place when clients are
able to “touch and feel” the products in their hands.
It is no longer news that the wealthy are all online and make up a substantial
segment of the cyber-resident population. From New York to San Francisco,
Mexico, Sydney, Tokyo, Beijing, Hong Kong, Mumbai, London, Paris, Milan
and Berlin, the world's wealthy are hooked online. Recent statistics from
Forrester Research indicate that in 2008 the British expenditure online for
