Luxury Institute News

February 9, 2016

Using digital to connect luxury shoppers with luxury brands

Luxury Daily
By: James Green
February 9, 2016

Every industry has been disrupted by technology and pushed to evolve their marketing strategy. In some ways, luxury advertisers have embraced the digital revolution and found new methods of improving the customer and user experience. But a large number of luxury marketing spend is still happening offline, despite the brand opportunities that are now available online.

There seems to be a common understanding among luxury brands that high-priced items are not going to thrive online and that using an ecommerce platform may even devalue products. True or not, direct sales are not the only way to get value out of the digital world.

Net net
Most luxury brands have a very specific target audience, typically affluent individuals. Therefore, luxury brands have traditionally bought digital media within specific owners such as The New York Times, Bloomberg and The Wall Street Journal because they feel that it is the best way they can safely find their audience online.

But what about all the people signaling their intent to buy luxury items across the Greater Internet? How do brands effectively reach out them?

Research from Epsilon and The Luxury Institute shows that 98 percent of luxury shoppers use the Internet regularly.

In addition, more than 50 percent of the time they are online, they are researching products and comparing prices on their mobile devices.

Throughout the years, studies from Google and McKinsey have shown that people spend a good amount of time researching luxury or high cost goods online before making their purchase.

And most likely, the number of times people visit a store to browse and conduct research has diminished because of the availability of information online.

With all this data about people, including demographic and information about brand affinity, along with precise data related to what people are searching for or what items they have recently purchased, there is a tremendous opportunity to use digital to identify luxury shoppers, provide them with immersive experiences and forge stronger customer relationships.

Researching signals purchase intent
Data offers established brands the opportunity to get in front of in-market buyers, including new customers and previous buyers.

Consider the amount of research that takes place before making a luxury purchase, whether that is a new car, piece of jewelry, handbag or high-end vacation.

According to WBR Digital, 45 percent of luxury purchases are influenced by what consumers find online.

The benefit of digital is that you can depict who is actually looking for information about your product and use that trail of data to determine intent to purchase.

For the luxury category, these insights will help brands determine who is ready to make a purchase and allow you to predict which people to keep informed about brand updates, such as new products, sales and seasonal marketing promotions.

Intent-based targeting is a strong complement to more traditional brand-centric media buying and helps luxury brands zero in on the people who are more likely to buy their products. It is also a great way to help them move through the buying journey, either in-store or online.

Enticing luxury buyers with digital creative
Luxury shoppers are very much part of the digital nation. They are using laptops, tablets and smartphones to follow trends, connect with brands, research products and make purchases.

Digital creative is critical to the luxury shopper – it needs to drive awareness without jeopardizing brand integrity and exclusivity.

Digital platforms have transformed their environments into creative canvasses for luxury brands. We have seen this through beautifully produced digital videos, immersive creative experiences and native advertising taking place across mobile devices and platforms such as Instagram and Facebook.

There is enough creative stability in digital for luxury buyers to bring their brand to life and to do so amongst the people who are most likely to buy. The dynamic characteristics of digital also allow brands to feature more products and change up creative more easily than television or print ads.

Forging lasting relationships online
People do not have to visit a store for you to know when and how interact to with them.

Online interactions between consumers and brands inform content, marketing frequency and promotions at the individual level, which can help increase customer loyalty and brand awareness.

Loyalty can be accelerated through social, email and digital display advertising at any point within the customer’s lifetime, and data can help predict these optimal moments.

This means that you need to be constantly learning and adapting to what people want so that your brand remains relevant and generates the engagement and desired response. There is simply way too much insight and value rooted in the digital medium for brands not to invest in it.

DIGITAL MARKETING may appear to be about data and targeting, but it is more about customer interaction, immersive experiences and interactive communication.

The luxury experience is more likely to stay very much in-store focused in the next few years. But this might be able to change once luxury advertisers find a way to prolong the experience that they are providing in-store across digital channels.

Data, adaptability and device versatility makes digital a strong brand vehicle for the luxury category.


February 1, 2016

Analysis: + Mobile Internet Trend, from the Following Aspects of Tourism Enterprises to Build Brands

Research Papers Center
By: Hui Wen and Xu Liyang
January 31, 2016

REVIEW: After entering APP era, the development of service interactions between tourism brand and customer communication and service must keep pace with changes in the nature of, the traditional means of communication with customers and business relations to do to maintain the cold, in mobile Internet era, companies can solve the information service again reshape the strong association with customers.

Now the ‘Internet + wave’ has swept all walks of life, the focus of enterprise development are inclined to the mobile terminal, after entering APP era, the development of service interactions between tourism brand and customer communication and service must keep pace with changes in the nature. Although tourism brand want to speak with one voice, but the challenge in practice the flow of information so that each employee interaction with customers need to re-start. For consumers, the same requirements to be transferred back and forth between different departments, but also with a number of service personnel to communicate is unreasonable. For a long time, the industry’s customer service representative sounds like automated robots, reading scripted answers and impersonal.

Now people authenticity and demand for personalized, interactive model that is very problematic. Fortunately, the messaging service App era become the travel company to provide true and effective personalized communication tool.

What values will resonate with today’s consumers?

With the development of consumer preferences, service brands are increasingly based on the need to strengthen the values of customer contact. In some iconic brand service, authenticity and one on one personalized recognition emerged as the leading brand attributes.


According to their geographical location, local ingredients from a farm to table moved from the hotel the moment, ‘authenticity’ has become today’s traveler compass. Quote a travel writer David Sze’s words, ‘for the 21st century traveler, its authenticity has become a journey of objectives and measures.’ The traditional hotel brand based local culinary experience to realize the promise of authenticity.

However, although tourism brand and strive to create ‘real’ feeling, but to become more than just buy one of the new consumer brand needs convincing. Authenticity is difficult to define, but it can not be fake. As more hotel brands want to pursue the truth, it is difficult to ignore its existence. Airbnb’s CMO Jonathan Mildenhall believes that the brand experience is based on different approaches to millions of user generated. So how can we establish a set of standardized practices the traditional brands to revitalize it?

One relationship

Remember, each greeted by name, each a unique individual for the brand consolidate the relationship between them and the passengers are influential. Although the interaction between people has been a sign of good service, but consumers now see that these interactions will be an important cornerstone of the brand consolidation. In the luxury summit last October, CEO Milton Pedraza, the Luxury Institute, said, ‘As consumers become increasingly sophisticated, increasingly commoditized product, cross-channel interactive experiences and people will be to distinguish between brands key. ‘and recognized by customers and guests personalized communication brand will stand out. 

How will these consumption values associated with the mobile Internet era?

As we said, ‘Welcome to the mobile Internet (after APP) era’, consumers increasingly want to interact with companies through the information platform, while commercial traffic is also growing rapidly. However, the information platform is not just a communication channel, the interaction of information makes us totally different customer experience, it shows that consumers desire is real, one to one relationship, the following instructions to do so three a bonus:

It helps create intelligent brand. In a voice or face to face interactive virtual world, or cross-sectoral team to share information is very difficult, especially in Transition. Adverse exchange of information so that consumers just keep repeating, it makes them feel worthless and not taken seriously. In contrast, information platform to create a communication path between each employee and each customer, with the historical data of these interactions, as referred to work when employees will no longer need to take over from scratch to talk with customers.

Treat each consumer as a unique individual. When customer-facing employees about customer information or interaction history, customer will be able to as a unique individual treatment was 11. Staff know the customer’s name, you can refer to past experiences have occurred, rather than to allow customers to repeat the same question. They do not need to be rebuilt from scratch every customer interaction. In order to prove to the customer’s perception, brands need to establish one to one relationship and long-term loyalty.

Human interactions with employees and achieve real butt. In their personal lives, consumers have learned how to use social media and the use of carefully chosen profile picture to express their identity. Facebook and LinkedIn allows people to meet in the absence of knowledge of each other. Information platform for employees and the brand provides a canvas to express their identity. Behind the tourism brand, the real understanding of the customer is to establish a true relationship with customers more powerful ways.

In short, the information platform enables brands to offer a unique experience of large-scale, resonate with today’s consumers.


June 11, 2014

6 luxury marketing trends to watch

By: Marco Muellner
Luxury Daily
June 11, 2014

For luxury marketers, 2014 is predicted to be the year that tips the scales, with more than half of affluent shoppers discovering, actively browsing and shopping for luxury items via digital channels. This evolution is spurred by shoppers who are online to save time, yet remain likely to finish the purchase in-store.

According to an April 2013 Luxury Institute study on the multichannel purchasing habits of United States Internet users with incomes of at least $150,000, 48 percent of respondents sourced information about luxury fashion online via a computer. Yet only about a quarter actually completed the purchase online.

Also, eMarketer found that a whopping 74 percent of purchases researched on mobile devices are completed in-store.

Which brings me to the first trend to watch:

We tend to think of mobile consumers as similar to desktop consumers, but on different devices. This is just not true.

Most mobile time, is, well, mobile. Digital marketers have always struggled to predictably drive offline traffic to retail, but data suggests this is changing.

With more than 70 percent of daily Facebook and Twitter users on a mobile device, digital marketers must think mobile-first.

For luxury marketers this is particularly challenging as device constraints and consumer expectations limit the richness of the experience.

But with skill and creativity, many luxury marketers are embracing the constraints without compromising brand promise.

Understanding the purchase intent journey
We have been trying to figure out what makes people buy as long as we have been selling, but it is a fragmented challenge and capturing the data at every step has been impossible.

We have made a lot of progress thanks to companies such as Datalogix and others and, as a result, luxury marketers are on the verge of the next evolution, having almost completely wired the journey.

The key, like most things in our modern world, is the smartphone.

In this next phase of digital marketing, understanding how and why consumers buy will be essential to attracting the next generation of affluent shoppers.

Click the link to read the entire article:

February 5, 2014

Wealthy Shoppers Tell Brands How They Want Technology Integrated Into The Shopping Experience

(NEW YORK) February 5, 2014 – The New York-based Luxury Institute asked consumers 21 years of age and older from U.S. households with minimum annual income of $250,000 about their views on incorporating technology in the shopping experience.

Nearly half (47%) of wealthy consumers say that a sales professional providing live chat or video assistance online would help them understand more product details, and 58% appreciate the convenience of instant answers.  Only 15% of shoppers say that they have tried chat or video and refuse to do it again.

Wealthy shoppers do not mind companies collecting personal data and using it for customized marketing, but they do show strong distaste for clandestine data gathering via mobile phones, facial recognition software and GPS tracking; 69% say information collected in this manner is a privacy violation.  Just 24% approve of retailers using facial recognition software to identify them and observe shopping habits.

Using technology in-stores to accelerate checkout is popular, but many affluent shoppers shy away from self-checkout.  Almost three-fourths (73%) say that they appreciate the time savings of checking out via mobile devices instead of standing in line at cash registers.  Although 45% say that self-checkout is more efficient, 44% prefer transactions with help from staff.

Technology has little to do with what wealthy shoppers desire most: free shipping and returns, cited by 92% of respondents.

“Habits of today’s wealthy consumer have increased the desire to browse, reserve and purchase using a mix of channels,” says Luxury Institute CEO Milton Pedraza. “Technology allows brands to leverage customer data and shopping habits, however salespeople still play a vital role into creating unique and engaging experiences.”

November 30, 2013

Are Apple users savvier shoppers?

Posted in Mobile

By Quentin Fottrell
November 29, 2013

Owners of iPhones and iPads pay a premium for their Apple (NASDAQ:AAPL)   devices, but that doesn’t mean they aren’t looking to save a few bucks elsewhere. In fact, though Android devices outnumber those running iOS, Apple users were four times as likely to search for Black Friday deals, new research finds.

As retailers released their Black Friday deals online on Thanksgiving, data indicates that owners of Apple devices were on the case. U.S. consumers using Apple’s iOS operating system drove 19% of online sales compared to 5% for Google’s (NASDAQ:GOOG)   Android, according to the “IBM Digital Analytics Benchmark,” a real-time analysis of millions of online transactions from 800 retailers. The type of device used also affects sales. Smartphone owners browse, while tablet owners buy, the study found: Tablets drove 15% of online sales versus 9% for smartphones.

Apple also has far more affluent customers than Android, says Milton Pedraza, CEO of the Luxury Institute. What’s more, Apple users spent $127 per order online versus $113 for Android, the IBM study found. Android phones are sold at heavy discounts, while Apple keeps a tight rein on its pricing for iPads and iPhones, says Thomas Husson principal analyst at Forrester Research. “iOS users also tend to be more mobile-savvy than Android’s,” he says.

Click the link to read the entire article which includes a quote from Milton Pedraza, CEO of Luxury Institute:

October 16, 2013

Have to Ask What the App Costs? It’s Not for You

By Claire Cain Miller
New York Times
October 15, 2013

The superrich have always had magazines, hotels and retailers catering to the special needs of their stratosphere. So it’s no surprise that the digital world has caught up.

Though luxury brands and services were initially reluctant to go online, a new corner of the Web and mobile app marketplaces has emerged, dedicated to making life easier for wealthy consumers. “They’re playing off the affluent desire to be treated differently, expect a very high level of service and have something edited and vetted and pay for that,” said Andrew M. Sacks, president of the Affluence Collaborative, a research firm studying affluent consumer behavior, and AgencySacks, a branding agency.

Luxury advertisers then follow closely behind. “If you’re successful in bringing several thousand affluent customers to a site, you’re then prime to offer brands and advertising to that audience,” Sacks added.

Click the link to read the entire article:

June 10, 2013

Affluent Shoppers Make Mobile an Essential Stop in the Purchase Funnel

Discounts get affluent mobile shoppers to buy

June 10, 2013

The wealthy consumer is highly likely to own a smartphone or tablet, and the devices are becoming critical shopping tools for these high-income individuals. In April 2013, the Luxury Institute surveyed US internet users ages 21 and older with gross incomes above $150,000 and found that more than eight in 10 owned a smartphone, while 56% reported owning a tablet. These penetration rates are well above those for the overall US population on smartphones or tablets.

As affluent consumers become increasingly comfortable with their smart mobile devices, they are turning to them throughout the purchase process. The Luxury Institute found that the most common smartphone mcommerce activity was looking up store information. After this came product research and comparison shopping.

On tablets, consumers were most likely to look up product images and read user reviews and recommendations. This points to the increasing importance for luxury retailers to make sure they have an attractive, interactive tablet showcase for their products, as tablets serve as “lean-back” devices, which consumers often use to get to know potential purchases.

When it came to making actual purchases, the store still won out as the most common place to make a purchase among affluent consumers, cited by 78% of respondents. Purchasing via the desktop web was right behind, however, cited by 77%. Women were 6 percentage points more likely than men to make a purchase through this means, while men showed a greater proclivity to buy on mobile.

Mobile websites on tablets were the place where the greatest percentage of shoppers made mobile purchases, at one out of five affluent consumers. Another 11% used a tablet app to make a purchase. Fourteen percent of affluent consumers used the mobile web on a nontablet device to buy and 12% used a mobile app.

And even if affluent shoppers have plenty of cash at their disposal, that doesn’t mean a deal won’t help them convert. On tablets, special deals or price discounts were the No. 1 reason respondents would purchase via these devices, with 43% indicating that would sway them. On smartphones, special deals tied with ease of use, at 45%, as top reasons to complete a purchase on the device.

October 17, 2012

Luxury Institute exec: Humanize first, mobilize second

By: Rimma Kats
Luxury Daily
October 17, 2012

NEW YORK – A Luxury Institute executive at the Luxury Interactive 2012 conference said that brands must understand the value and potential of personal sales associate communications versus mass emails from corporate.

During the “Optimizing Mobile Technology to Build Customer Relationships” session, the executive addressed how mobile technology is not a differentiator, but a utility. Moreover, it is how marketers use the technology that matters.

“It’s all about the human-to-human relationships,” said Milton Pedraza, CEO of Luxury Institute, New York. “The biggest opportunity to use mobile to drive profits is customer relationship building.”

Click the link to read the entire article which includes quotes from Milton Pedraza, CEO of Luxury Institute:

September 22, 2012

Consumers’ Expectations High for Luxury Brands on Mobile

The highest percentage of high-end consumers expect luxury apps to include a loyalty program

September 21, 2012

Luxury brands have been slow to the mobile party, with marketers steering clients toward traditional brick-and-mortar locations where products could be displayed in elegant surroundings and customers were treated to an impeccable shopping experience. But luxury brands are making up for lost time, according to a new eMarketer report, “Luxury Marketing: Recreating the One-on-One Experience with Mobile.”

Click the link to read the entire article:

September 18, 2012

Luxury Institute CEO on Why You Must Empower, Educate & Mobilize Sales Forces

By Kelly Hushon
The eTail Blog
September 17, 2012

Milton Pedraza, CEO at The Luxury Institute, says we should be providing just as much information to the sales professional as we do to the customer. Makes sense. Somehow many retailers still aren’t doing that.

At a presentation he gave at eTail Europe this past June, Pedraza used Apple as an example. The company empowered its sales force by arming them with mobile devices that allowed them to interact with customers more efficiently and personally. But that’s just the beginning.

When retail stores are less full, Pedraza says there is a great opportunity for sales professionals to work on relationship building with their customers, and they can do so if they are given mobile devices with minimal functionality that allows them to reach out to the clientele they already have through email and other forms of mobile communication. Sales professionals can reach out to customers and nurture relationships in a way that scientific algorithms and data mining can’t compete with because, quite simply, they’re not as good as human beings.

It might seem radical – you might be thinking, “So you’re asking me to give my sales person in my store a mobile device and let them openly and directly email customers? NO WAY!”

According to Pedraza, it doesn’t have to be so scary. The two keys to doing this successfully are:

1. Hire the right people. Hire people who share your customer centric values. If they are selfish, they should work elsewhere.
2. Educate, educate, educate. And add to that Empower; use incentives that will empower them to build relationships with their customer base.

So why haven’t more retail operations done this already? Pedraza says it’s because it’s easier to create a technology app than it is to face the idea of finding the absolute best people, training them and paying them properly. He’s convinced though, that if we do this, it will pay off.

Customers who have admitted having a good relationship with a company and/or its sales force have been proven to spend more wallet share with said company.

Click on the link below to view the brief video of Luxury Institute CEO, Milton Pedraza, and hear more about why this idea works – and why, if you’re not already – you should be doing it:

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