In an op-ed, Assoc Prof Julien Cayla from the Division of Marketing of NTU's NBS discusses how luxury stores are becoming more experiential, and how after a late start, brands have only just started to embrace digital channels.
"But luxury brands are still playing catch-up in trying to adapt to a globally diverse, fast-changing clientele," he wrote.
"Based on our research, in which we talked to more than 100 luxury customers and retailers in key luxury markets, we argue that the future of luxury retail will be all about hybridity. Only through a hybrid retail strategy will luxury retailers be able to adapt to a rapidly changing luxury market - through spatial hybridisation, technological hybridisation, and interactional hybridisation."
For example, Assoc Prof Cayla explained that spatial hybridisation refers to using retail spaces to cater to a diverse clientele visiting stores. Some luxury brands are already doing this. For example, Van Cleef & Arpels created a "bridal bar". Clients can sit on high stools, sip a glass of champagne, and choose from a menu of rings.
Meanwhile, technology is key in creating a more hybrid and modular experience for luxury consumers. "Think, for instance, of wealthy and regular luxury customers. They are frequent buyers, but they may see little value in the time-consuming experience that luxury stores entail. Or think of customers who may see luxury brands as an investment," he elaborated.
Lastly, for interactional hybridisation, Assoc Prof Cayla said that to deliver more positive interactions, managers need to move beyond brand-centric sales training. Up till now, luxury companies have used their brand as a guiding force for their global expansion. These investments have paid off and attracted hordes of new customers, especially in Asia.
