Despite growing economic concerns at the hands of global pandemic, the online luxury retail market is growing. While traditional conversion strategies work for online retailers, there are specific considerations to be made for luxury retailers.
Let’s take a look at what luxury marketing is, how it differs from marketing in traditional retail markets, and ways luxury brands can optimize their sites to boost conversion rates.
What is Luxury Marketing?
The key to marketing luxury brands is unlike the traditional retail market, as the luxury retail market focuses on positioning and creating the highest levels of brand recognition.
The Future of Luxury Marketing
According to a study by Statista Consumer Market Outlook, the global luxury market should anticipate growth of nearly $ 103 billion from 2020 to 2025, despite an initial decrease in discretionary spending resulting from the COVID-19 pandemic. Luxury brands are expected to capture more consumers in the more socially-conscious Millennial and Gen Z markets by continuing to trend toward ethically and sustainably produced luxury goods.
The study also predicts online sales will outnumber sales of brick-and-mortar stores, meaning now is the perfect time for luxury retailers to optimize the experience they provide for online shoppers.
Conversion Optimizations Strategies for Luxury Online Retailers
Avoid Incentives, Add Additional Value Instead
Since brand identity is vital to the survival of luxury brands, it’s common for high-end retailers to avoid using incentives that might decrease the perceived value of their products. It is more important to create a seamless and personalized shopping experience that will cater to the needs of shoppers.
Luxury consumers are willing to pay a premium not only for high-quality products, but also for the experience surrounding the purchase. These shoppers want to feel special and important, and the online shopping experience should cater to that just as a brick-and-mortar experience would.
Offer Advanced Product Recommendations
Part of creating a seamless and personalized experience for online shoppers includes making sure they don’t miss any product offering they might be interested in. It is up to the online luxury retailer to provide advanced product recommendations and ensure shoppers get the most out of their experience on their site.
UpSellit’s Real-Time Recommendations monitor visitor behaviors to predict which products they will love. This allows retailers to offer smarter recommendations that help improve the experience for their shoppers.
Boost AOV with Upsells and Cross-sells
Two recommendation strategies that work especially well to increase average order value (AOV) are upselling and cross-selling. Upselling involves recommending higher-priced alternatives to products a shopper is interested in. This is a great strategy for luxury consumers because it ensures they don’t miss out on all the premium features of a luxury brand’s latest or most upgraded models.
Cross-selling is a strategy used to recommend products complementary to what shoppers already expressed interest in. A great example of this is “complete the look” campaigns, where the retailer suggests a piece that matches well with what the shopper has in their cart. Cross-sells appeal to luxury consumers by providing them the opportunity to round out their shopping experience with a more polished look.
Since purchases of high-end products usually entail a higher level of involvement, creating urgency is an incredibly useful tool for encouraging conversion. UpSellit uses a scarcity strategy to alert shoppers when there are a limited number of items left in stock. By creating urgency to purchase, this strategy shortens consideration time and encourages on-the-fence shoppers to convert before their item of interest goes out of stock.
Establish Social Proof
Another useful strategy for converting shoppers on the fence is to utilize the theory of social proof. This is essentially the idea that consumers are influenced by what their peers are doing. It works especially well for the luxury consumer, who is typically conscious of how quickly popular items sell.
One of the strategies UpSellit employs to leverage social proof is highlighting the number of other people currently viewing an item. This demonstrates to the shopper how highly sought after the item is, leading them to conclude it is a good choice and follow through with a purchase.
Collect Emails Throughout the Customer Journey
Since luxury purchases are driven by smaller traffic segments, it’s important to retailers to maximize customer lifetime value. Collecting visitors’ emails at checkout or upon abandonment allows retailers to create personalized remarketing campaigns to recover lost sales, and ultimately keep luxury shoppers returning for more latest releases.
Drive Sales Without Compromise
Exclusivity, image, and value are all incredibly important components that make luxury brands what they are. By adding value for shoppers and understanding their needs and behaviors, luxury online retailers can create campaigns that will optimize conversion without having to compromise on key brand elements.
Looking for More Ways to Increase Conversions?
Check out UpSellit’s 27 Attributes of an Effective Email. This in-depth guide covers the ins-and-outs of crafting the perfect remarketing email. It’s a great resource and it’s totally free! Download it today and start writing awesome emails that convert.