Information Technology Reference
In-Depth Information
cost-effectiveness, coupled with a wider reach and extensive data-capturing
capabilities, has suddenly made e-retail appealing to luxury brands. Some of
the luxury brands that used their e-boutiques as dumping grounds for products
that were under-performing in the stores are suddenly expanding their range
online. Those that sniffed at e-retail a few years ago are currently trying to
optimize sales returns online. The tables have been turned and with this frenzy
has come a certain disorientation. Most of the confusion stems from the fact
that the majority of the brands that are suddenly trying to sell online are doing
so without an integrated e-business strategy that would guide the online prac-
tices to assure desired sales levels. The direction taken by these brands is one
of creating an online store without first establishing a solid e-presence backed
up by a strategy. The result is often disappointment with the low activity in the
e-store and the consequence is under-performance.
To be able to sell luxury online successfully, brands need first to craft an
e-business strategy and plan that will develop all aspects of their web pres-
ence before integrating e-retail in this mix. Luxury e-business strategy doesn't
have to begin with e-retail. In reality, defining a brand's web presence through
e-retail could have adverse results. It can lead to avoidable mistakes and mak-
ing the brand unappealing due to a lack of prior online presence and experi-
ence. The ideal approach of e-retail would be to follow a systematic process of
launching an appealing website with rich and interactive content and incorpo-
rating the e-boutique within this environment. Online luxury shopping should
be an enriching and pleasurable experience in which clients are engaged with
every aspect of the website and not only the e-boutique. Engaging clients
means ensuring that the website features the appropriate elements in its inter-
face with the front office and that these are supported by the required systems
in the back office. The web elements that are suitable for one luxury website
are not necessarily those that are the best for another. Just as each luxury brand
is distinctive in its DNA, the websites and e-boutiques should represent this
distinction by featuring elements that are fitting for each brand.
In addition to front and back office systems decisions, the integrated luxury
e-retail strategy follows tactical choices in product selection, pricing approach,
countries of distribution, service approaches and channel integration. These
aspects are further analyzed in the following steps.
Step one: the location choice
Following the decision to sell online, the first assessment a luxury brand
ought to make is that of the markets that the e-retail activity will serve. This
choice could range from countries, regions and states, and will subsequently
affect linked issues like pricing, currency, warehousing, transport, after-sales
and several types of legal issues. Although the Internet is global in reach and
the ideal choice would be worldwide distribution, it is not always feasible due
to regulations, logistics and complex processes. The choices that a luxury
