In a highly competitive retail terrain and amid an environmentally conscious era of “less is more,” retailers and luxury goods are taking cues from tech and captivating young consumers with services that make them feel included.
From live shopping to product insurance to circular solutions like second-hand appraisals, brands old and new, are forging partnerships and buying up startups to innovate and inject creativity into their ethos to fight for their survival.
Last week, Bloomberg reported that Facebook bought Packagd, a five-person company founded by Eric Feng that over the last few years, has been working on a YouTube shopping innovation.
“Think of it as a re-imagination of QVC or a home shopping network,” Feng told Bloomberg Television’s Emily Chang back in 2017.
According to the report, the new live shopping feature will allow buyers to ask questions and place orders within the live broadcast.
Fueled by the popularity of live Facebook and Instagram stories, the ‘live” trend is a way to satisfy a new generation’s desire to be listened to and understood.
“Feelings are a part of the post-aspirational luxury value equation, to make your customers feel happy,” said the Bain-Altagamma 2019 worldwide luxury market report, which explained that consumers today are looking for seamless, impeccable experiences, self identity definition and self transcendence. In other words, they want to be delighted, inspired and they want to have hope amid trying times.
In China, live influencer streaming played a huge role in rendering the Alibaba’s Single’s Day a huge success.
Many of the nation’s top social media stars spoke to shoppers in real time, answering questions about size and color for hours during the event. This is part of a larger trend in China, in which younger consumers not only want to be heard, they want to be entertained while shopping — much like a generation of women were charmed and convinced by QVC’s TV hosts Pat James and Steve Bryan to buy the latest gadgets and cubic zirconia bracelets — in the comfort of their own living rooms, decades ago.
When it comes to physical retail, keeping up with the times requires staying in-tune with trends more than ever. This month, Farfetch and Chanel teamed up to unveil the boutique of the future. Part of their ‘exclusive global multiyear innovation partnership” the French maison and luxury e-commerce platform introduced two apps: one for clients and one fort their sales team. The apps allow customers to access runway images and deep dive into new products, while an associate scans the client’s QR code and suggests targeted items and show the client how they looked on the runway via a connected mirror.
Elsewhere in tech, services across the board are securing profits into the future. When it comes to iPhones, consumers are more reticent to pay high ticket prices for a phone but they are increasingly appreciating the plethora of services extended to them.
Apple's services category, which includes iTunes, the App Store, the Mac App Store, Apple Music, Apple Pay, AppleCare, Apple Arcade, Apple News+ and more, drove the group’s fourth quarter sales up to $12.5 billion, up from $10.6 billion in the same period a year ago.
But for many established luxury brands and fast fashion retailers alike, sustainability and services linked to sustainability are paramount.
Stockholm-based H&M is now offering loyalty program customers the opportunity to rent 50 items and during a trial period, up to three pieces per week, for the equivalent of $37 per item. H&M is already testing clothing repair services and has offered recycling services free of charge for H&M branded clothing for a few years, as a part of its larger sustainability strategy.
Amid trying times for physical stores, historic leaders like Neiman Marcus Group are staying on top of the game by taking advantage of the lucrative secondhand retail market by investing in designer handbag and accessory consigner Fashionphile. The partnership allows Neiman’s consumers to sell or trade their bags or accessories and get money back and buy new items from the retailer. Both Neiman and Selfridges hosted in-store popup shops by resale platforms Depop and Vestiaire Collective.
“The luxury consumer is even more present than in the past. Interacting, conversing, sharing and judging this industry. Bain said, adding that in the long term, the next generation of luxury consumers will be pushing luxury brands to test their limits in terms of creativity and innovation. For more established brands like Missoni, sustainability is the first thing they think about when it comes to safeguarding profits, services, and innovation.
“Sustainability is like learning English or Chinese for the ‘tomorrow’ generation,” said Angela Missoni at the Altagamma luxury conference in Milan last month. ‘If it is a trend, that is great. It should be like the first thing you think about in the morning like brushing your teeth".