2016 Luxury Industry Predictions From The Experts

Luxury Media & Marketing Channels In 2016

Neil Cunningham, Managing Director of Cream UK describes the new media and marketing landscape to be forged in 2016, and how it will Impact luxury branding and consumer communications going forward.

In 2015, we saw luxury brands continue to ‘ramp up’ their digital efforts – shifting budgets from offline to online and recruiting more digital talent to their teams.

For many luxury brands, 2016 will see more of the same. But we think the forward-thinking ones won’t be __ramping up__, they’ll be __integrating__ - placing digital at the heart of their operations rather than just adding more resource to siloed parts of their business.

Luxury businesses need to fully embrace digital because their consumers already have. Globally, 95% of luxury buyers are digitally connected and it’s estimated that 75% of luxury purchased are influenced by at least one digital touchpoint.

“ No matter what the market, digital is at the centre of the luxury decision making process ”

No matter what the market, digital is at the centre of the luxury decision making process – in fact, research has revealed that Chinese consumers consult more digital resources than UK consumers when making a luxury purchase.

However, the brands which succeed in 2016 will not use the ‘mass market’ template of digital transformation, but will spend time thinking how they can use the tools at their disposal to create a unique digital luxury experience. A couple of developments in 2016 will help them to do this.

Firstly, virtual reality will enter the mainstream with the launch of the first commercial available VR headset from Facebook’s Oculus. The luxury store is still the most important touchpoint in the decision making process for luxury buyers – VR will enable brands to present a similar experience digitally, enhancing their online experience, extending their reach and potentially cutting their costs.

“ Success won’t just come from ‘dabbling’ in VR and AI, but in re-thinking their entire approach to digital ”

Secondly, artificial intelligence – delivered by the likes of IBM’s Watson – will become more sophisticated and widespread. AI will enable luxury brands to harness two sources of knowledge – what they know about their consumers and what they know about their products – to deliver digital service akin to that delivered face-to-face in-store.

But it’s important to note that success won’t just come from ‘dabbling’ in VR and AI, like luxury brands have dabbled with other luxury tools in the ‘ramping up’ phase, but in re-thinking their entire approach to digital across their entire business to create a unique, integrated online experience for their consumers.

That will be the key to success in the coming year.