Let the Web do the shopping: Online luxury comes of age
Jessica Michault IHT
Tuesday, August 10, 2004
PARIS In the jet-set world of luxury living, globe-trotting fashionistas have finally embraced the shopping medium that is made to measure for their lifestyle: the Internet.
Once a bastion of mass-market outlets like The Gap, J. Crew and Nordstrom, the World Wide Web has recently made inroads into the elite world of luxury shopping. A handful of sites - among them net-a-porter.com, neimanmarcus.com, eluxury.com and vivre.com - are catering to some of the world's wealthiest people, and making a profit.
Who would have thought that virtual luxury could be so successful? For these shopping princesses, there is no saleswoman at beck and call, no visceral thrill when crossing the threshold of an exclusive store, no one-on-one time with the products before purchase. Let's face it: Buying a $40 T-shirt at the Gap is one thing, but spending $1,750.00 on a Darby Scott taupe ostrich clutch, sight unseen, is something else altogether.
According to Elaine Pinkster, a senior consultant at Ledbury Research, a luxury-market research firm, these multibrand retailers are outperforming their single-brand counterparts. Neimanmarcus.com has seen its online sales grown to $200 million from $150 million in the past year. And the American jewelry company Tiffany, which sells everything from jewelry to baby rattles online, has seen its Web site and catalog sales rise 15 percent, driven by larger online orders.
So how have these Web sites won over a group of people accustomed to the best? By giving them what they crave the most: exclusive luxury at their fingertips.
"When I came up with the idea, no one wanted to take the risk," said Natalie Massenet, the founder and managing director of net-a-porter.com.
Inspired by her love of the Internet and her frustration with the lack of Web sites dedicated to top fashion labels, Massenet left her job as a fashion editor and started a Web site where she herself would choose to shop. Since it opened for business in 2000, Massenet says, the site has seen sales double every year, with more than 1,000 new customers a month. In 2003 the site had a turnover of $11.7 million.
At about the same time, Eva Jeanbart-Lorenzotti started the Vivre Web site as a complement to her successful luxury catalog business. "I wanted to create another way for people to have access," said Jeanbart-Lorenzotti. She predicts that Internet sales will soon outpace those of the catalog, and says that more than 3.5 million Internet users visit the site every year.
Run like online glossy magazines, these Web sites have Top-10 lists of must-haves for each season and pages dedicated to new or little-known designers. All the clientele have to do is decide which of the hard-to-find items they want to buy.
"Vivre is a success because it is a lifestyle business," said Jeanbart-Lorenzotti. "Luxury is not about money, it is about those special moments in a women's life - and we help create those moments."
What sets these Web sites apart is the fact that top-name designers have agreed to sell their goods online. When the Internet started out, there was no glamour factor and retail sites were all about bargains, they had no frills, and they sold a lot of overstocked items. For luxury brands nothing is more important than image, and selling on the Internet was the equivalent of selling out of the back of a truck.
"We really had to show the designers that our site was a celebration of their work," said Massenet. "That it was going to be a full-price, high-frills global niche market for people who love and understand fashion."
Another part of the appeal of these sites is the rarity of the items they make available. Fashion-savvy women the world over who might never have heard of designers like the Paris-based minaPoe or the Dutch duo Viktor Rolf can now buy their goods on the Internet.
Survival has as much to do with quality service as it does with product. This means making available personal shoppers, adding handwritten notes and little gifts to purchases, and delivering anywhere in the world in less than 72 hours, customs taxes included. And, of course, wrapping everything up in beautiful boxes tied with a bow.
Is it all as perfect as it sounds? What happens if the $2,186.00 Missoni multicolor Noemi cut-out jersey dress doesn't fit? What if there is a button missing?
"We want to exceed expectations; that's our mantra, " said Massenet. "We offer a customer-friendly returns policy, and we pay for the return and exchange shipping charges. We realize our customers need to try things on before making the final decision to keep an item."
This kind of customer service has given the luxury sites something that no amount of money can buy - good word of mouth. Vivre.com says that customer loyalty has driven its repeat business up 78 percent.
But many luxury Web sites have a long way to go before they will be able to handle the demands of the world-traveling wealthy. "It's a fantastic opportunity," said Pinkster, the research consultant. "But a lot of the luxury Web sites are glorified brochures - Bulgari.com or Prada.com for example, where you can't buy anything. And some of the great retail sites, like Ralph Lauren's polo.com Web site, will only ship to the United States, even though the company has stores all over the world."
This seems to be the Achilles' heel of some of the best online luxury retailers. With most of them based in the United States, there appears to be an isolationist attitude on the Web, with an American bank account or shipping address needed to complete an online order.
But there is even a bigger problem for online luxury shoppers: what happens when Roland Mouret's last Torridon gray silk evening gown for $2,223 has been sold? Is there any hope for a frustrated fashionista?
Never fear - eBay is still here.
The online retail behemoth, which had $1.8 billion in worldwide gross merchandise sales for its "Clothing, Shoes Accessories" category in 2003, might seem like the antithesis of the niche Internet luxury market.
But its style director, Constance White, disagrees. "On eBay you can find things you can't get anywhere else in the world," she said. "When the Louis Vuitton Murakami bags sold out and there was a waiting list at the stores, the only place you could find them for sale was on eBay." With the arrival of White, a former fashion reporter for The New York Times, and the launching of an online fashion magazine, Personal Style,it is clear that eBay sees a future in high-end retail. And while eBay remains a place where one person's junk can become someone else's treasure, the number of brand-new items being sold continues to grow. In the clothing and shoes category alone, 50 percent of the items on offer are new, up from 15 percent in 2001.
So what does the future hold for online luxury shopping? How will these virtual stores continue to innovate and make the shopping experience even more user-friendly?
Massenet of net-a-porter.com is already hard at work on what she sees as the next big step. "I envision a day when a business woman will be having lunch and then her phone will ring," she said. "When she opens it up she will see an image of the latest Marc Jacobs coat that just arrived in stock. With a click of a button she can purchase it and then find it waiting for her when she gets back to her office."
International Herald Tribune