When luxury meets e-commerce : online challenges of luxury brands and development of a marketing strategy to approach luxury apparel & accessories and hard luxury brands

Abstract

This thesis has been written as a consultancy report for LiveArea – the PFSweb agency in order to determine whether the company can target luxury brands for its digital agency services. The first step consisted in an analysis of the internal and external situation of the company together with an detailed description of the agency services. These analyses were realized in order to better understand the environment in which LiveArea evolves. The second step was to define the main elements of the luxury environment. The subjects of the industry, the market, the consumers, the experience and the digital strategies of luxury brands were addressed. The third step consisted in the development of the marketing strategy of the agency. To do this, the traditional steps of a marketing strategy were completed. These are the segmentation, the targeting and the positioning. Regarding segmentation, two theoretical models were applied to the luxury industry and the agency. These models divide the luxury industry into three levels of luxury. The accessible, intermediate and inaccessible brands. Twelve brands were selected regarding this segmentation, two brands per luxury level were chosen. For the targeting, a scorecard was realized. This table evaluate the performance of the twelve selected luxury brands vis-à-vis of the different digital channels. Each channel got a score regarding the traffic it brings to the website of the brand. Then, evaluation criteria were attributed vis-à-vis of the main elements of the optimization of these sources. Luxury brands were evaluated regarding these criteria and each one got a score. The brands reaching the highest score were selected as segments to target. The last step, the positioning, was realized as recommendations. The new services of the agency were defined and a differentiation regarding the competitors was realized.