Insights

When worlds collide: The luxury and digital sectors

Business Development & Strategy Director
Valtech France

October 29, 2016

One could think that the luxury sector, essentially timeless, and the digital industry, disruptive by nature, would be worlds apart. And yet these two ecosystems, embodying very different temporalities, are capable of interacting and creating exciting new trends. Valtech has been accompanying leading luxury brands for over 20 years. As a privileged witness of the digital revolution and an actor in these transformations, we take a look at this improbable encounter between the luxury and digital worlds.

The luxury sector, its codes and standards

This is the first major point to be addressed. Indeed, in recent years we have seen the emergence of new brands using the codes of the luxury sector in an endeavour to be assimilated. While they cannot boast either the prestigious history or the clientele of the major designers in the industry, they do adopt both their terminology and their images, as well as their attention to packaging, etc. It is these various codes and standards that are responsible for their success today, establishing their clients as a happy or privileged few even though they number in their millions.

In a way, what we are witnessing is a theatrical performance, a staging of these brand names which have integrated digital technologies in an extremely intelligent way, capitalizing on their extraordinary power to reach the general public, to disseminate a skilfully crafted brand image, and thus to capture new markets. And, as always, it is the user journey that is at the heart of this reflection. These multifaceted brands are sufficiently flexible to know exactly how to position themselves at the intersections of influence, using what is beneficial for their image branding without abandoning the mainstream, which represents the foundation of their turnover.

Tradition and modernity, a question of balance

It is obviously the question of balance that is at stake when two such very different worlds as the luxury and digital sectors collide. While to an extent they are diametrically opposed, this opposition is not systematic. Rather, their interaction raises real issues for those luxury brands that wish to evolve with their times. To what degree can a traditional brand afford to be seen to be adopting digital technologies? What share should the latter have in the brand’s image and practices? The best hybridization success stories are undoubtedly those of certain top names in the French haute couture industry.

While remaining true to their vision and philosophy, these brands have nevertheless understood how to implement powerful levers of the digital industry to give them a real competitive edge. They have played on the disruptive – sometimes insolent – nature of digital resources to attract new consumers, portraying a new and more modern image. For them, digital technologies are an indicator of trends, but they choose to implement only some of them in order not to lose their original identity. And it is obviously this intelligent and conservative approach that we find interesting, being as it is a real evolution effected at the deepest level, and one that is therefore lasting.

To digital evolution and back again...

Finally, we can also cite some examples of “de-digitalization”. This has notably been the case with certain brands which adopted an all-out digital transformation – no doubt a little too virulent – only to later realize this solution was not for them. Or that it was, in any case, too much. While some brands conspicuously remained in their corner ignoring all of the opportunities offered by the digital world, others made the opposite move... before backtracking once again because they felt their initial choices were bad, and that they had more or less lost their souls along the way.

Here at Valtech, while we are champions of digitalization, we also feel very strongly that this digital transformation should never be a distortion of a brand’s vision and philosophy. It is the authenticity of a brand that its clients love – and while the latter are willing to concede some changes to their own benefit, they do not want to see the intrinsic nature or behaviour of their favourite brand change. Another point – and no doubt the most important one – is that digital practices are but modus operandi, new levers to achieve new results. They should not be seen as a revolution, cutting off heads or reinventing the wheel! Where there is transformation, it must be to the client’s benefit, facilitating the fluidity of their purchasing process, increasing the ease with which they access the products they need, offering greater customization, etc. Outside this scope, no revolutionary digitalization is possible!