Characteristics of the Luxury Industry’s Online
Presence in 2011
Time Saving Consumers
Majority of online customers included people who
wanted to spend money online in order to save
time. Also, they looked for variety and choice.
01 02
Offline Showrooming before Online Purchase
Potential customers first practiced showrooming
of products by visiting an offline store to
experience luxury product in person and then
searching online to purchase it.
1
Source of Information
Despite more purchase being witnessed in a physical
store, luxury retailer’s website and apps served as a
source of information regarding products and
directions to the nearest stores..
03 04
Facilitated Real-World Decision Making
Websites such as Feyt, Lyst, Pose etc. acted as a
medium that facilitated social shopping allowing
consumers to interact with strangers, friends and
style insiders through photo-sharing.
KERING ONLINE PRESENCE
UNEVEN DIGITAL ACADEMY
PERFORMANCE
-Had online sales since 1996 with RedCats and FNAC
- Online savvy brands like Gucci, Stella
McCarthy, Yves Saint Laurent
expanded their online presence.
- Other brands like Bottega Veneta
Balenciaga did not grow with industry.
ONLINE SAVVY BRANDS
KERING
ONLINE PRESENCE
- Gucci, first e commerce website in 2002.
- 12 countries by 2009 3.2 million followers
- 1 million downloads in Gucci App.
- Yves Saint Laurent in 25 countries
- Stella Maccarthy in 30 countries and ipad App
- Group Wide change Management
- Digital culture in kering owed brand
- Developing innovation, supporting e-
business, digital awareness & aspirations
and create a digital community.
OTHER BRANDS
- Bottega Veneta had ecommerce in 3 nations
- Alexander McQueen had 2 e commerce site
- Balenciaga had 3 ecommerce websites
- Balenciaga also limited its ecommerce by
selling only on its own websites.
 PORTER’S FORCES ANALYSIS
The establish players adds to the cost related to the entry, access to raw materials, Threat to new
barriers related to culture and technical standards. entrant

The competition companies are competing hard in order to maintain their Competitor
power within the industry. The companies compete in their niche segments. Rivarly

Powerful suppliers possess more power to capture significant value for themselves
by demanding high prices while limiting the quality and the quantity of the product Supplier Bargaining
or services or by transferring the cost on the participant of the industry Power

The customers in this industry have less bargaining power. This is mainly
because of the luxury product category and high brand loyalty in this segment. Customer
Bargaining Power

High threat of substitute leads to low profitability as it limits the industry profits
Substitute
by placing a price ceiling due to the fear of being substituted by other product.
Products
Fake products, similar Logos, and other practices are prevalent in this industry.
 Yoox
- Started in 2000, Yoox.com sell OVER STOCK products from brands like Roberto Cavilli & Diesel, 100+ nations.
- Thecorner.com sells other luxury products from rising designers to consumer sin more than 50 countries.
- Yoox provided specialisation to luxury brands to handle their ecommerce operations by producing websites that
captures the DNA of the brands in form of technical knowledge and understanding of luxury markets.

Net-a-porter
- Net-a-porter specialized in digital space, by providing same day delivery before product sells out.
- It operated in 170 countries, is a digital pure players as it operated in digital space only.
- Provided the digital skill that many other brands lacked.,

E-Bay
- Started in 1995, specializes in consumer to consumer selling.
- Faced quality trust issues because of peer to peer selling. This restrained ebay from leveraging potential in luxury

Departmental stores
- These brick and mortar stores were perceived to be safer and familiar to the consumer.
- Stores like Saks used technological engagement to covert sales. 50% consumers choose retail stores for luxury buy.