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Digital IQ Index®: Fashion 2015

Online sales of luxury goods account for 6 percent of the €224B global luxury market. However, the industry may be on the cusp of a “tipping point.”

In 2014, online sales increased 55 percent year over year—representing 80 percent of the sector’s annual growth.

The channel shift represents a risk to traditional luxury houses—as brand loyalty does not transfer proportionately online.

While offline luxury sales remain heavily fragmented, online sales are concentrated with less than ten brands driving 65 percent of site traffic.

37 percent of luxury e-commerce sales in the U.S. now take place on a mobile device. On paper, Fashion brands appear largely mobile optimized and m-commerce ready.

However only Cole Haan has reduced the painful mobile checkout experience, experimenting with “Buy with Apple Pay” from its mobile app, and fewer than 1 in 5 brands subsidize store sales by allowing users to see nearby inventory.

In 2015, Burberry recaptured its familiar place as Index leader after falling to 6th place last year.

In the interim, Burberry prioritized and enhanced its mobile platform and tripled digital sales attributed to mobile.

In addition, while other brands are befuddled by emerging platforms including Snapchat and Periscope, Burberry has executed at scale—generating over 100 million impressions of its “London in Los Angeles” runway show last April.

This study quantifies the digital competence of 83 Fashion brands in the US market. L2 member can download the report at L2inc.com.

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