L2’s Digital IQ Index provides information on the digital performance of 90 fashion brands which operated in the United States. The report includes best practices and digital strategies to allow fashion brands to be educated in online luxury in order keep up with the changing, digital age of Millennial luxury fashion consumers. The Index examines both a brand’s strengths and weakness across the following four digital dimensions: Site and E-Commerce, Digital Marketing, Social, and Mobile. Index brands can be classified as Genius, Gifted, Average, Challenged, or Feeble.
“Luxury fashion continues to lag in digital sophistication behind other sectors,” Brian Lee, Associate Director at L2 Inc., said. “As a result, luxury fashion brands have become susceptible to growing threats from disruptor brands such as Everlane and Reformation, who have built their business models on digital competence and social media marketing. Such brands provide quality, craftsmanship, and a seamless shopping experience that are quickly becoming budget-friendly alternatives to the luxury brand consumer.”
One key finding from L2’s report is a threat of resale; 38 percent of Index brands do not own most search terms for that brand. For example, in November 2017, 40 percent of paid search traffic for Céline for were for resale sites, when the brand site itself only received 18 percent of the search traffic. Another key finding was focused on Instagram. In 2017, Index brands have increased their followings on Instagram by an average of 53 percent. Followings on Facebook have increased by 11 percent, while YouTube has increased by 28 percent. In addition, 12 percent of Index brands include shoppable tages in Instagram posts, providing consumers with the ability to purchase products directly from a post. A third key finding from L2’s report is that in the past six months, 29 percent of Index brand have not updated their iOS apps. Furthermore, 56 percent of their iOS apps have not been updated in the past year. Only 18 percent of luxury fashion brands’ mobile apps have appeared on the App Store’s list of the top 250 apps available.
“As department stores struggle, luxury fashion brands should ensure they prioritize their digital investments to stay afloat as digital-first competitors like Amazon, resale platforms, and off-price sites elbow their way into the market,” Emma Ward, Senior Associate at L2 Inc., said.
To view the report click here
By Rachel Tallis